Skip to main content
Hamburger Menu Close


CNA Lifestyle

Real estate advice: How to invest in property when you're not a millionaire

It's possible to get into property investments even if you don't have a few million dollars lying around – but you have to be prudent about it.

Many people say they’ll invest in property when they get rich. But sometimes it takes investments to make money – the other way around. 

Here’s how to (safely) get into property investments when you don't have a few million dollars lying around. 


To buy a property that costs S$1 million, you don’t need to have a big chunk of the money available: Around S$50,000 in hard cash and S$200,000 in your CPF. The key thing to take advantage of is the huge amount of leverage provided by your home loan. A home loan is also one of the cheapest loans you’ll ever get in your life (around two per cent per annum).

But it’s important to understand how home loans work. There are ways to keep the costs down (for instance, refinancing or repricing at the right time, or accepting lock-ins when they’re to your advantage). There are also ways to find the cheapest rates out of the hundreds of packages available, and to avoid traps like obscure board rates.

(Photo: Pexels)


If buying a second house to let is way out of your budget, your only recourse is to treat your current house as a form of investment. But that can mean dealing with certain constraints.

It might, for instance, mean buying a property in a neighbourhood with good growth prospects, but not one that you like personally. Or you might have to buy in a location that is out of the way. The good thing is, development over the years may mean there’s a long-term payoff.

READ: Now may be the best time to buy a HDB resale flat – here’s why

You’ll also want to seize value buys, such as a house priced unusually low given its quality and location; but might put your workplace a 90-minute bus ride away.


If you’re married, make sure you and your spouse have a shared vision on the property. If you want to use the house as a stepping stone, but your spouse sees it as a forever home, you’ll be cruising into a storm. And of course, your partner must be on board with buying a house that’s a great investment, but far from the children’s school or workplace.

(Photo: Pexels)

If you involve other family members, make sure there’s an investment plan that everyone understands and agrees on. Write it down. If you co-own a condo with your parents, for example, you don’t want a situation where you’ve secured a buyer, but your parents disagree with the sale.

READ: Property tips: The 5Cs of buying a home that every Singaporean should know

Always remember that property investment requires infrequent but deep decision making. You won’t have to make a lot of decisions every month (you may only need to make a decision once every few years) but when you do, such as who to sell to, or how to rent, that decision has tremendous financial impact; there is much less room for error.


If think that buying a house translates into returns rolling in for the next 15 years, you’re in for a surprise. A super-rich investor can afford to ignore small increases in home loan repayments or maintenance fees. But as a starting, small-time investor, the small costs can eat into your gains. 

When you claim the flat 15 per cent on tax deductions instead of tracking the exact costs of utilities and maintenance, you could lose money. When you don’t refinance despite a cheaper loan package being out there, you lose money.

(Photo: Pexels)

When you don’t crunch numbers to work out the cheapest renovation loan, don’t check on the management committee at AGMs, and don’t realise the difference between fixing an electrical issue on a Sunday versus Monday, you could lose money.

These small expenses are like cockroaches: Ignore one or two, and suddenly you’re wondering why you’re up to your eyeballs in them.

As a small-time property investor, don’t be afraid to be "ngeow" (Hokkien for calculative). You need to be picky about every detail of the house, right down to checking where your contractor is getting the supplies, and the prices of those supplies.

READ: Which type of HDB flat gives the best returns: 3-room, 4-room or 5-room? 


If you were to completely lose every source of income tomorrow, your home loan(s) should stay paid for another six months. That’s the minimum to shoot for.

During a major financial disaster, you’ll need to sell your property. But if you don’t have six months, your property agent – no matter how good he is – wouldn’t have the time to market the house, conduct viewings, negotiate, and secure a good price. The faster you need to divest yourself of a property, the less you’ll make from it.

(Photo: Pexels)

Or if you’re renting out the property, being financially liquid for six months means you don’t need to rush into the first tenant you find just to keep the rent paid. Desperation is how landlords end up with negative rental yields, or bad tenants.

This article first appeared on

Source: CNA/bk