Are you considering renting or buying property in Singapore? When deciding whether to rent or buy Singapore property for your overseas property investment, you must take into consideration the risks and consequences of each option.
Lovely residential property
To help you weigh in on which choice would best fit your lifestyle, we have listed the pros and cons of renting or buying property in Singapore.
Pros of renting a Singapore property:
Flexibility – Renting out a property in Singapore doesn’t restrict tenants if they ever need to move out due to work.
Fewer obligations – No need to pay for maintenance, major repairs, property taxes or other significant issues.
Property values don’t affect renters – Property values affect the amount of property tax, mortgage and rent one pays. These values can go up and down. While these greatly affect homeowners, it doesn’t do much on renters.
No huge down payment – Down payment for renting out Singapore property usually costs less than paying for a down payment when you buy Singapore property.
Cons of renting a property in Singapore
Can’t make major changes on property – You will need to ask for permission for any major changes you to apply to the property since you are not the owner.
You are paying for the owner’s mortgage – Renting a real estate is basically paying the owner’s mortgage.
Zero return on investment – You get nothing in return when you only rent Singapore properties.
Incapacity to build equity – The main reason is that you don’t own the property, which leaves you the inability to get a share of the property’s value.
Pros of buying Singapore property:
The sense of ownership – You are fully in control of the property and can enjoy the rights of owning a Singapore real estate.
Earn a return – When you buy Singapore property and the home appreciates more than the taxes, mortgages, interest and maintenance you paid for overtime, you will get a return.
Fixed-rate mortgage – Having a fixed-rate mortgage will cause your home costs to be more predictable.
Get an income from buying to rent property – You may choose the option of buying to rent which will produce income from renting out your Singapore real estate.
Cons of buying property in Singapore:
Provide higher down payment – The total cost of buying property in Singapore is usually bigger than renting one, which means providing a higher down payment is needed.
Ownership costs more – Aside from paying down payment, a foreigner buying property in Singapore will need to pay for other costs such as insurance, maintenance, repair and property taxes.
Interest rates fluctuate – This may happen especially if you have a variable interest rate where it can increase any time.
The responsibility of finding a tenant – Deciding to rent out your house means you will need to find your own tenant.
Now you know the pros and cons of buying and renting a Singapore property, you can read more guidelines on how to buy overseas property through Yazhou Property blog. You may also find overseas property when you check out our Facebook page.