Real estate investing can be exciting and profitable—but only if you know how to analyze deals the right way. Whether you’re eyeing your first condo or your tenth property, a smart analysis helps you avoid costly mistakes and make confident decisions. In this blog, we’ll break down how to analyze real estate deals in a simple, beginner-friendly way.
We’ll also share tips that apply whether you’re investing in a bustling city or a peaceful residential area like the Tampines Street 94 Condo, one of the emerging hot spots in Singapore.
Step 1: Understand the Market
Before diving into numbers, it’s crucial to study the local real estate market. Ask yourself:
- Are property values increasing in the area?
- What kind of properties are in demand?
- Is the neighborhood safe and accessible?
Use online real estate platforms, property reports, and Google Maps to get a feel for the area. Visiting in person can give you even better insights. For instance, buyers looking at Tampines Street 94 Condo are drawn to its well-developed infrastructure, schools, and transport options—these factors all add value to a deal.
Step 2: Determine the Property’s Purpose
You should be clear about why you want to buy the property. Is it:
- For rental income?
- A fix-and-flip investment?
- Your future home?
The way you analyze a deal will change depending on your goal. For example, if you’re buying to rent, the rental yield becomes very important. If it’s a flip, renovation costs and resale value are your focus.
Step 3: Calculate the Purchase Price and Costs
A property’s listing price is only part of the total cost. Here’s a breakdown of expenses to consider:
- Purchase price: The amount you’re paying for the home.
- Closing costs: Legal fees, stamp duties, agent commissions.
- Renovation costs: If the place needs fixing or updating.
- Property taxes & insurance: Annual or monthly charges.
- Maintenance fees: Especially for condos like the Tampines Street 94 Condo, check monthly maintenance charges.
Add all these up for a clear view of what you’re really paying.
Step 4: Estimate Income (If You Plan to Rent)
Rental income is your biggest asset in a rental deal. Research what similar properties in the area are renting for. You can check:
- Property listing sites (like PropertyGuru)
- Local rental ads
- Real estate agents’ estimates
Let’s say a unit at Tampines Street 94 Condo rents for SGD 3,200/month. That gives you an idea of your potential monthly income. Multiply that by 12 months to get your yearly rental income.
Step 5: Check the ROI (Return on Investment)
To truly understand if a property is a good deal, calculate ROI. Here’s a simple formula:
ROI = (Annual Net Profit / Total Investment Cost) × 100
First, find your Net Profit:
- Rental income – expenses (taxes, insurance, maintenance, loan payments)
Then divide that by your total investment (purchase + fees + renovations). If you get a positive percentage—say 6% or more—that’s a healthy ROI in most markets.
Step 6: Run a Cash Flow Analysis
Cash flow is the money you have left each month after paying all expenses. Positive cash flow means your property is earning more than it’s costing.
Cash Flow = Monthly Rental Income – (Loan + Maintenance + Taxes + Misc. Costs)
Even if ROI looks great, a property with negative monthly cash flow could strain your finances.
Step 7: Consider Appreciation Potential
Apart from rental income, some properties increase in value over time. This is called appreciation.
Factors that increase appreciation:
- Future infrastructure developments
- New schools or malls
- Government planning for that area
Tampines Street 94 Condo is a great example. Located in an evolving part of Singapore with growing demand, this development could offer solid appreciation in a few years.
Step 8: Factor in Financing Options
Unless you’re buying in cash, you’ll likely need a mortgage. Analyze:
- Loan amount vs. your down payment
- Interest rate
- Loan tenure
- Monthly repayments
Use loan calculators to estimate payments. Make sure your expected rental income can easily cover the monthly mortgage.
Step 9: Think About Risks
Every investment carries risks. With real estate, common risks include:
- Rental vacancies
- Property damage or unexpected repairs
- Market downturns
- Interest rate hikes (for loans)
A good investor plans ahead. Keep an emergency fund and always budget with some cushion.
Step 10: Use the 1% Rule (Bonus Tip!)
This is a quick way to evaluate if a rental deal is worth exploring.
1% Rule: Monthly Rent ≥ 1% of Purchase Price
Example: A property costs SGD 500,000. Is the monthly rent at least SGD 5,000? If not, it might not be a great rental deal (though exceptions apply in high-value cities like Singapore).
Final Thoughts
Learning how to analyze real estate deals can take a bit of practice, but once you get the hang of it, you’ll feel much more confident making investment decisions.
Always remember to research the area, run the numbers, and think long-term. Whether you’re looking at a family home or a hot property like the Tampines Street 94 Condo, the right analysis can lead to profitable, stress-free investments.