Important Things To Know When Buying Commercial Property In Singapore

If you are thinking of purchasing commercial property in the beautiful and progressive city of Singapore, it is probably one of the best investment decisions you will ever make. Urban commercial real estate not only offers great practicality but also offers a very profitable return on investment (ROI). Therefore, if you can make the right decisions while investing, you can practically earn millions of dollars on your investments. However, there are some things you should consider before embarking on your venture, especially if you are investing for the first time. This is an investment worth millions of dollars, so it's important to be very careful not to make any mistakes, as even small mistakes can end up costing you a lot of money. Below, we will discuss some of the things you need to consider when investing in commercial real estate in Singapore.

1. Investing in commercial real estate is exempt from many taxes, such as Additional Buyer Stamp Duty (ABSD) and Seller Stamp Duty (SSD).

2. Commercial real estate is not subject to various restrictions that apply to foreign ownership.

3. Investors can purchase commercial real estate in the city as individuals or as part of a corporation or partnership.

4. Investors cannot use the Central Provident Fund as a down payment for the purchase of commercial property. The deposit must be paid in full in cash.

5. If the commercial property does not generate enough income to repay the loan, the buyer must repay the loan in cash.

6. The owner of commercial and industrial real estate must pay an annual property tax equal to 10% of the annual value of the property. However, property owners who are unable to find a tenant for their property may apply for a vacancy refund.

Commercial real estate offers higher rental yields than residential real estate. 

One of the most profitable aspects of commercial properties like Tai Seng Point is that they offer higher rental yields than residential properties in urban areas. Rental yields for commercial and industrial properties in Singapore are around 5% of the property value, compared to 2-3% for residential properties. However, this high rental yield is often offset by the high maintenance costs of such properties. Additionally, renovation costs for commercial facilities are considerably higher than those for residential buildings. Commercial real estate is valued higher than residential real estate.

Under the right conditions, a combination of rapid supply and increasing demand will cause the value of commercial properties like Taisen Point Singapore to rise faster than that of residential properties. This allows investors to get high returns on their investments. Additionally, investors can improve their chances of higher returns by meaningfully improving their properties.

In summary, investing in commercial real estate in Singapore can yield a high ROI, but only if the investment is made wisely. Investors should pay close attention to every step of their investment.

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