Jun 3, 2019

Cory Diary : Leapfrog your wealth

There are ways to leapfrog our wealth. Coming from below middle income family, and choosing a down-to-earth wife ( hee hee ), marriage do helps but inheritance from our families are out. Neither do our families have business acumen. So I would say today my siblings and we are above middle income. Hey, that's what makes Singapore incredible isn't it ? As long we work hard and smart, with a little luck and opportunity, we are contented.

As previously blogged, I am a "Value Saver" but I aren't frugal. I can spurt a dinner that cost few hundreds, and renovation in good 5 digits. As a value/dividend stock investor, this bring me quite a good sum to my net-worth. Of-course this won't happen fast enough if I do not have monthly salary and saving, and then equity investment.

Now, I can add that Property Investment as another option to propel. See chart below. With the mark-to-market valuation based on recent residential transactions of surrounding properties on the same development. Of-course some friends would say as long I don't sell, is only paper gain. This actually applies to my dividend stocks too. Nevertheless, Net-worth is the market value you have. 

My thinking is whether we sell it or not is subjective. Holding cash in an inflationary environment is losing money too so I rather put my money to work continuously. Unless we are doing short term speculative trade, taking profit to realize the gain is cutting our game short as a good hedge against inflation.

Property provides a strong underlying asset base so I am in the mentality of "Never Sell". It can be also be an insurance that if needed, I could use it for downgrade therefore the more I would like to hold it for long term appreciation to be meaningful.

What I find amazing from this experience is how fast the pace of  property appreciation and loan leverage can do to one's net-worth. No wonder our government needs to introduce curbs to rein them in to ensure more stable market.  As for another sharing based on my limited experience, I realised the surrounding properties about few hundred meters away do not appreciate much at all for the same period. A real example of location of property matters in value appreciation.

In summary, the list of Wealth Accumulation. 

1. Monthly Salary - Yes
2. Property Investment - Yes
3. Stock Investment - Yes
4. Marriage
5. Saving - Yes
6. Inheritance
7. Business



  1. But if property is 99 years, then it depreciates....

    1. Anything on lease surely depreciates when there is no option and is at tail end of the lease. This is similar to Reit properties I would guess. However, total return should include valuation at the point of concern and potential rental income or saving if you have rented. So if one has used the properties say 80 years. Is 80 years of rental cost compounded vs the initial investment.

  2. Your property sounds like HDB BTO that has just or about to hit 5-yr MOP? :)

    There's this recent phenomena (within last 1 year or so) whereby just MOP'ed HDB are bidded up quite excessively high by motivated buyers.

    Dunno why .... seems irrational to me.

    The other relatively nearby HDB that are not "new" e.g. 10-15 years, don't see price appreciation. In fact their resale prices have dropped a lot from 2013 onwards!

    How I treat my own residential property --- I roughly monitor market prices maybe once a year; I don't include it as part of networth; I treat it as consumption.

    Hence for some people, can be luxury consumption, & for others can be value-for-money consumption. LOL!!

    1. Well is ok to agree to disagree. I can use an example of a new car. Used 5 years. Is a consumption item but it has resale value nevertheless. And should be part of your net worth. Why not ?

    2. I left out on the property reply. thanks for sharing on the possible excitement from new properties. Net worth should adjust accordingly with time be it down or up. If is me, a newer property should be priced higher. How much, not sure lol. When there are curbs and there is lack of market sentiments, price could come down. So I think there are multiple factors to consider. Mine is new development condo.