What Is Assets Progression ?
Your goal in creating an asset progression plan is to increase the value of your net worth.
It is a long-term strategy that needs to be closely followed. It necessitates exact calculations and direction.
The earlier you start, the more time your investment has to increase in value.
Is it even necessary for me to begin an asset progression plan?
My wonderful house is being paid for using CPF.
I have a reserve account.
I stay inside my budget.
Yes, it is fantastic that you manage your finances responsibly. The issue is that the majority of us utilize our CPF to pay for our homes. One of our earliest investment vehicles, CPF is intended for retirement.
Third, a lot of Singaporeans are discovered to be unprepared for retirement. This is because our home’s value actually accounts for the majority of our net wealth. The antiquated strategy is to use the maximum CPF to purchase a large home, remain there for 30 years, and then downgrade. Long ago, the strategy used to work. From 1975 to 2019, the data on house prices climbed from 8.90 to 152.2 Index Points. An rise of 1600%!
How often have you heard your parents tell that they paid $25,000 for their home and that it is now worth $400,000? Your $400,000 HDB should cost $6,400,000 if growth continues at the same rate as before!
Do you anticipate that costs will increase by the same amount in 30 years?
The government might not want that to happen to our public housing, in my opinion.
As of December 2018, the Department of Statistics Singapore reported that Singapore’s house ownership rate was 91%.
The desire to own property in Singapore is almost ingrained in every Singaporean. Additionally, many times there are many properties for very valid reasons that will be discussed just below.
And did you know that nearly one in five purchasers of real estate in Singapore are either foreigners or permanent residents?
The following individuals have recently purchased residences in Singapore: Eduardo Saverin, James Dyson, Jim Rogers, Sun Tongyu, Jackie Chan, and Jet Li.
Why do they place such a high value on Singapore real estate?
For the following reasons, a lot of overseas buyers are drawn to invest in Singapore real estate or buy a home there.
political and educational stability It is good for families because of the low crime rate and secure surroundings.
Singapore’s position as one of the world’s top financial centers Due of Singapore’s outstanding value for money compared to properties in other major cities around the world, highly gifted foreign people are drawn to the city-state to improve their careers there.
Despite the ups and downs in real estate values across various time periods, these factors have put Singaporean homes on a long-term price rise trajectory.
As part of the Property Asset Progression strategy, homeowners can grow their property portfolio from a single HDB flat to a portfolio of multiple properties that can earn income for them or generate capital gains for them. Moving from HDB flats to private condominiums is also considered an upgrade.
This progressive process of asset growth takes time and requires considerable planning and effort, as the word “progression” rightfully implies. The goal is not to make money fast or to get rich quick. Quite the opposite, the Property Asset Progression requires careful research and even years of strategizing.
Property Asset Progression must start even before the first property is acquired for it to be successful. Homeowners need to implement the right strategy at the right time before they can reap the benefits of CPF and mortgage loans, and it is not a get-rich-quick scheme.