top of page

A Tale of 2 Investors (Which One Are You?)

Updated: Sep 6, 2020

Which type of property investor are you?
Which type of property investor are you?

Taking a break in between work to discuss what is a common question today.

Whether to buy a property today or to wait further, consider this simple situation between 2 friends.

Tim buys a $1m property today.

John feels that the market will correct further and waits out.

3 years later, the market has fallen by another 10%. John buys the property at $900K.

Who has done better?

real estate investing dilemma and risk management

What happened for John:

Pros: John buys 3 years later at $900K.

ABSD could be revised.

Cons: Loan tenure shortened by 3 years. MMI has increased.

If market had rebounded during the 3 years, John misses out and loses more years waiting for the next correction.

In the mean time, he gets older and loan tenure gets even shorter.

What happened for Tim:

Tim buys at $1m today.

Rental yield of 4.2% (Achievable in OCR/RCR projects or even CCR projects like The Sail).

3 years of rental income – $126K

Less est. interest: $26K

Market falls 10%. Valuation: $900K + Rent $100K.

Nett Equity: $1M.

Tim ends up in the same position as John but has the added advantages of:

– A potential capital gain if market rebounds within the 3 years.

– Lower MMI as a result of his longer tenure. Positive cashflow after paying mortgage, interests, maintenance fees etc.

– With the equity in his property, he has the option to gear up today to invest in more properties or markets.

Who then has made a wiser decision?

Which path would you have chose?


29 May 2019 Update:

This article was written in 2016 in a post on my former blog ( In 2018, ABSD went up by 5% across the board for Singaporeans, PRs and foreigners while prices nary dipped even almost a year after the cooling measures.

John, representative of many fence-sitters and market bears, has once again missed an opportunity to enter the market.

Understanding the multi-facets of the property market is essential to making the best investment decision you can for yourself and your loved ones.

Property investment is not as clear cut as buying low and selling high.

It involves many advanced factors and considerations that can either help you retire comfortably, or face prospects of having zero or the wrong property that affects your retirement goals.

If you're planning on getting started on property investing or are looking to upgrade or restructure your current portfolio, drop me a message and let me share with you more about how Property Wealth Planning can help you achieve financial freedom.

Or watch this short video to understand more.


Stuart Chng

Did this article provide you better clarity?

Like, comment below and share the love with your friends who might benefit from this knowledge!


Stuart Chng is a Senior Associate Executive Director of OrangeTee & Tie, and a renowned leader and mentor in the real estate industry.

He adores music and can play a few instruments decently without upsetting his neighbours. When not doing so, he enjoys pillow fighting with his son and coming up with silly puns which barely amuses his wife.

Professionally, he is a licensed real estate agent, investor, team leader, speaker and columnist for several property newsletters and blogs and is often quoted in media interviews on 938FM, Channel 8, PropertyReport, PropertyGuru and other publications.

Throughout his career, he has helped many clients grow their wealth through selecting great property investments and managing their portfolios actively. Read his clients' reviews here.

Stuart has also coached many top million dollar producing agents from different real estate agencies in Singapore. Read his agents' reviews here.

Related readings:

39 views0 comments


bottom of page