why the rich people gets richer?

As under $1m property appeals more to most people, let’s take example of a 2rm property in District 11 (abt 12mins walk from Novena MRT) at $900k.
Assuming 80% loan at 3.5%…
Property Price: S$900k
Your Investment: $180k
Monthly Installment: $3233
Potential Rental Return for this property has been between $3800 – $4200 in the past 3 mths. But let’s use the lower rate.
At $3800, means a Rental Yield of 5.06%(3800×12/900k). That’s not bad for Singapore investment!
But then,  your actual investment is really the initial capital of $180k, so adding misc cost like stamp-duty, maintenance, legal, etc, your total cost is perhaps $205k.
Therefore, using $205k of your cash to invest in property that generates $45.6k annually means a whopping 22.24% ROI !!! Now which investment in Singapore gives you such return over 2years at least. Not forgetting you still own a physically asset, which has no monthly installment to worry (as the $3800 rental pays the monthly installment of $3233 $180 maintenance fees).
Not forgetting, you can also potentially collect “bonus” in capital appreciation, during a bull-run. Assuming annual growth of 6%, that could mean potentially capital appreciation of at least another $100k to $200k. That should more than take care of all cost, including interest incurred over 2years.
of course, like any investment with high returns, there’s always downside risk. But unlike stock (which can drop to 0), you still have a physical asset that you can still rent out if the market is not favourable for sale, and generate income to pay towards part if not all of your monthly installment while you wait for the next wave.
So the bottom line is, may sure you have holding power before you enter any investment. Not only should you have the cash to invest, but also the cash to hold to weather thru any storm.
Sigh… now we know why why the rich people gets richer.