Asked on 03 May 2018
What did you with the property in the end?! :D
Well, it takes most understanding & perspective of your situation to really get the most ideal advise and opinions.
However, with this limited info, just to throw in a different perspective.
Especially with the lower interest rates as of now, one can consider taking a mortage on the house right now and make new investments!
The market is at a discounted price! Or maybe invest in another property and get more rent?! Wow!
Of course, one would need a proper stragety and structure in venturing to all these different ideas. Hope your parents are doing well and are retire! Cheers!
Sell if you think the price is right...
And what to do with the cash?
Buy an island!
(With ideally, a house and enough land for farming and sun bathing!)
Alternatively, you can always park the money in a combination of Singapore REITs and Robo-advisors.
If you do not need the money urgently, you should keep it and collect rental as property prices tend to trend upwards over the long run.
If you own the property in Singapore, Don't dare to sell it. In Singapore properties are getting expensive and expensive day by day, because we have a shortage of land. Try to invest your income from rent in Stocks, Nowadays you can buy amazing stocks at the cheapest rate.
If it is freehold, just leave it and collect rental. If it is leasehold, you may want to sell it at a good price and buy another property as long as you have the money to pay the downpayment and the monthly instalments.
1) Is the property paid up in full or are your parents still paying the mortgage? If it is paid up in full, the rental collected is passive income which can be put towards other investments. If mortgage is still being serviced, then we need to work through the numbers to see if makes sense to hold on to it or liquidate it.
2) What are your parents plans in the next 5-10 years? While there may not be an immediate use for the proceeds from selling the property, your parents need to be more forward thinking when talking about "investing" the excess cash, simply because when you talk about investing, there is always a minimum timeframe that the money should be left untouched.
Just to buy another property need 12% more or 15% more to take profit.
With 500K how much profit can one made in investment.
Hope it answer your question
Since money no need for immediate use, then what plans is there for the excess cash?
Will you be able to find any other investments to generate returns on this excess cash and without losing this pot of gold?
Rental collection is good long term income, once the mortage is all paid.
Need to buy another property to stay? Or downgrade? If so, then must consider now property price going up, buying another property to stay may not be so cheap.