View Full Version : Biggest loan you make in yuor life before?
care to share?
what do you think of loaning $1million..
is it the norm nowadays?:o
Sorry to intercept; Is it wise for me to take up 1.2 to 1.5 million loan with a household income of around 7-8kSGD with 30 years loan? I like to get one landed terrace unit.
Sorry to intercept; Is it wise for me to take up 1.2 to 1.5 million loan with a household income of around 7-8kSGD with 30 years loan? I like to get one landed terrace unit.
i went to calculate for 1.5 million @ 2.25% interest for 30 yr
you need to pay around $6800++/mo
i put 2.25% interest so that we don't get offguard with rise of interest rate later in 10 or 20 yr time ..(as compare to the low interest happen at current market now)
Sorry to intercept; Is it wise for me to take up 1.2 to 1.5 million loan with a household income of around 7-8kSGD with 30 years loan? I like to get one landed terrace unit.
... it does look a bit stretching ..... do you already have a liquid asset that's about 500k ?
care to share?
what do you think of loaning $1million..
is it the norm nowadays?:o
how old are you ? in the report in front of me, I read, for housing loan of age group 35-39 :
3.72% have loan 1M or more
9.25% have loan 500k to 999,999
12.29% have loan 300k to 499,999
12.14% have loan 200k to 299,999
29.09% have loan 100k to 199,999
21.84% have loan 50k to 99,999
11.66% have loan <50k
how old are you ? in the report in front of me, I read, for housing loan of age group 35-39 :
3.72% have loan 1M or more
9.25% have loan 500k to 999,999
12.29% have loan 300k to 499,999
12.14% have loan 200k to 299,999
29.09% have loan 100k to 199,999
21.84% have loan 50k to 99,999
11.66% have loan <50k
Where's the source of this report?
... it does look a bit stretching ..... do you already have a liquid asset that's about 500k ?
Nope. As a matter of fact, I still have an outstanding loan of 450k for my newly bought HDB flat.
rymccondo77
10-02-12, 10:54
Nope. As a matter of fact, I still have an outstanding loan of 450k for my newly bought HDB flat.
Your household income - is it for one person or two persons or more?
I am personally cautious - I will take a loan on the assumption of having one person's salary paying for the monthly loan payments (or at least one person's salary covering most of the monthly loan payments).
stalingrad
10-02-12, 10:57
Nope. As a matter of fact, I still have an outstanding loan of 450k for my newly bought HDB flat.
suggest you stay in your nice HDB flat. You are boxing above your weight class.
ikan bilis
10-02-12, 11:03
Nope. As a matter of fact, I still have an outstanding loan of 450k for my newly bought HDB flat.
urhh... how you buy another pte if you have a "newly" bought hdb ??.. :confused:
Nope. As a matter of fact, I still have an outstanding loan of 450k for my newly bought HDB flat.
450k is still a huge amount of debt to clear, imo. :doh:
Nope. As a matter of fact, I still have an outstanding loan of 450k for my newly bought HDB flat.
I don't think it's wise to commit another property at this point in time. Your dear wife will not have the option of taking time off her work to care for the kids if needed. Both of you will have to slog at your jobs for 30 years.
buttercarp
10-02-12, 11:45
Sorry to intercept; Is it wise for me to take up 1.2 to 1.5 million loan with a household income of around 7-8kSGD with 30 years loan? I like to get one landed terrace unit.
With the salary you are getting and an outstanding loan of $450k, it is unwise to take that amount of loan unless you have other investments which are giving you a stable source of revenue.
Otherwise just concentrate on paying up the $450K.
Your household income - is it for one person or two persons or more?
I am personally cautious - I will take a loan on the assumption of having one person's salary paying for the monthly loan payments (or at least one person's salary covering most of the monthly loan payments).
My household income = myself and my wife.
We are getting a total of approximately 7k plus with close approximate to 8k.
450k is still a huge amount of debt to clear, imo. :doh:
Your first HDB? 450k is alot!!
Your first HDB? 450k is alot!!
Yes, I got myself a HDB 5 room flat.
He must be paying the HDB with his cpf. But if u only earn 8k n u want to take a million loan, that's big risk. Try to hit 20k/m before even considering. IMHO
He must be paying the HDB with his cpf. But if u only earn 8k n u want to take a million loan, that's big risk. Try to hit 20k/m before even considering. IMHOYou don't need $20k/mth for a million loan to be without risk lah... $10k/mth can liao! :spliff2:
buttercarp
10-02-12, 12:25
He must be paying the HDB with his cpf. But if u only earn 8k n u want to take a million loan, that's big risk. Try to hit 20k/m before even considering. IMHO
Yup.... agree with you.
He must be paying the HDB with his cpf. But if u only earn 8k n u want to take a million loan, that's big risk. Try to hit 20k/m before even considering. IMHO
Thanks for the opinion.
I was hypothectically thinking of venturing into million housing purchase with my humble household income. Apparently, the reception is not going well and I believe the general perception is probably right.
Nonetheless, it is a good interaction and exchanges of views and opinions.
Let more to flow in, and sorry for interrupting the thread starter original thread.
You don't need $20k/mth for a million loan to be without risk lah... $10k/mth can liao! :spliff2:
I have colleagues and friends who goes for million valued housing spree with household income of 10k.
I believe they must have done their calculation.
Nope. As a matter of fact, I still have an outstanding loan of 450k for my newly bought HDB flat.
i thought you sold off your PC, then use the proceeds to fully paid your HDB, that's why you can sleep soundly now.:beats-me-man::beats-me-man:
My household income = myself and my wife.
We are getting a total of approximately 7k plus with close approximate to 8k.
I think no bank will lend you.
i thought you sold off your PC, then use the proceeds to fully paid your HDB, that's why you can sleep soundly now.:beats-me-man::beats-me-man:
Yes, I am just making a hypothetical example; to have a feel where I stand, and if it is possible for me to invest on a landed.
Yes, I am just making a hypothetical example; to have a feel where I stand, and if it is possible for me to invest on a landed.
wah biang, you mentioned you nearly kena retrenched and still want to take million dollar loan.:doh::doh:.
Bedok Reservoir waiting for you.
I have colleagues and friends who goes for million valued housing spree with household income of 10k.
I believe they must have done their calculation.
Hi, can PM me the names of colleagues and friends and the name of PCs they purchased?
I have colleagues and friends who goes for million valued housing spree with household income of 10k.
I believe they must have done their calculation.Yes you have to do your calculations properly... I use to have 2 people contributing to the household income until my wife decided to stay home full time to look after kids when we still have a $1mil plus housing loan so now I cannot relax in my job otherwise we all eat northwest wind already... :scared-4:
Yes you have to do your calculations properly... I use to have 2 people contributing to the household income until my wife decided to stay home full time to look after kids when we still have a $1mil plus housing loan so now I cannot relax in my job otherwise we all eat northwest wind already... :scared-4:
What is your current household income then?
buttercarp
10-02-12, 12:45
Yes you have to do your calculations properly... I use to have 2 people contributing to the household income until my wife decided to stay home full time to look after kids when we still have a $1mil plus housing loan so now I cannot relax in my job otherwise we all eat northwest wind already... :scared-4:
And you let her become a SAHM while you slave out the loan?:(
Hi, can PM me the names of colleagues and friends and the name of PCs they purchased?
Why do you need their name?
Anyway, they just bought the watertown, hillier, meyerise, horizon hill residence to name a few.
Why do you need their name?
Anyway, they just bought the watertown, hillier, meyerise, horizon hill residence to name a few.
no need to PM me their IC, just need their names, in the format like Mr Lee KY, Mr Mah BT. If can PM me full names better still.
Well, so that I can help them if they need help.
And are you serious? $10k household income getting Meyerise?
And you let her become a SAHM while you slave out the loan?:(
why the :(?
isn't it good that the father become the breadwinner and the mother SAHM?
no need to PM me their IC, just need their names, in the format like Mr Lee KY, Mr Mah BT. If can PM me full names better still.
Well, so that I can help them if they need help.
And are you serious? $10k household income getting Meyerise?
This is suspicious. I cannot divulge people's personal details.
As for meyerise 10k ceiling? I believe they probably have some backing in their sleeves.
Thanks for the opinion.
I was hypothectically thinking of venturing into million housing purchase with my humble household income. Apparently, the reception is not going well and I believe the general perception is probably right.
Nonetheless, it is a good interaction and exchanges of views and opinions.
Let more to flow in, and sorry for interrupting the thread starter original thread.
Bro, weren't you also the one looking for Mt Sinai property late last year and most pple told you that you were already overstretched?
Bro, weren't you also the one looking for Mt Sinai property late last year and most pple told you that you were already overstretched?
Hi, Yes. I am the person and was almost retrenched last year.
As mentioned earlier, I am throwing a hypothetical scenario to assess my own capability and risk profile.
With 2 people using CPF to pay the loan, the monthly cash repayment on a 1mill loan is probably quite manageable. But note that you are "borrowing" from your CPF at interest rate of 2.5% which is expensive by today's standards. A bank loan currently should be at less than 2%. To me, it doesn't make financial sense to use CPF for servicing housing loans at this point in time. It also gives you a false sense of security regarding your financial status as your cash outlay is much reduced. Wait 10 years and see how much accrued interest is reflected on your CPF statement which you have to pay back into your account from the proceeds when you sell your property. I assure you it will come as a rude shock. You will be one minute happy that you have made a profit from selling your property and the next minute you will realise that a lot of the profits has to go back into the CPF account to be locked up again.
Hi, Yes. I am the person and was almost retrenched last year.
As mentioned earlier, I am throwing a hypothetical scenario to assess my own capability and risk profile.
how old are u ?
get a studio below $600k
buttercarp
10-02-12, 13:05
why the :(?
isn't it good that the father become the breadwinner and the mother SAHM?
It is good if you are comfortable with your finances, but ysyap said he cannot relax as now he is the sole breadwinner.
From the sole breadwinner's point of view, it can be really stressful.
Stress from work, wife may become naggy (cos stay at home too long- may only ar....not will become).....all these may put a strain on the marriage.
how old are u ?
get a studio below $600k
I am 35 year old.
buttercarp
10-02-12, 13:11
Hi yowetan, this was your post on 30/9/2011:
http://forums.condosingapore.com/showthread.php?t=12157
"My current unit is a 2 bedder and was bought at 700KSGD. The recent transaction is estimated to be 850KSGD. Thus, an appreciation of 100-150KSGD.
I am fortunate for I work in a bank and I am able to get 90% loan from workplace.
The 7KSGD household income is inclusive of my wife and myself. We are in our thirties."
Did you manage to sell off your 2 bedder, if so did you get a good price for it?
ysyap is working??? I thought he is full time investor. He is making regular contribution to our forum here with wise words and advice.
Hi yowetan, this was your post on 30/9/2011:
http://forums.condosingapore.com/showthread.php?t=12157
"My current unit is a 2 bedder and was bought at 700KSGD. The recent transaction is estimated to be 850KSGD. Thus, an appreciation of 100-150KSGD.
I am fortunate for I work in a bank and I am able to get 90% loan from workplace.
The 7KSGD household income is inclusive of my wife and myself. We are in our thirties."
Did you manage to sell off your 2 bedder, if so did you get a good price for it?
We sold the unit for 800k+++.
I am 35 year old.
you see, i thk mm or studio for investment is ok for u.
otherwise consider overseas property (do ur own research)...
buttercarp
10-02-12, 13:16
We sold the unit for 800k+++.
Oh if that's the case assuming you made a profit of 100k, then i assume, still got to return some to CPF, which means you don't have much liquid cash from the sale.
As Lovelle has suggested get a studio. Or even an MM.
From the sole breadwinner's point of view, it can be really stressful.
Stress from work, wife may become naggy (cos stay at home too long- may only ar....not will become).....all these may put a strain on the marriage.
May not be all that bad lah... some couples in the situation actually pull that off quite well although daddy has to work harder (and smarter so that he doesn't end up on the retrench list.) :)
Afterall, Having mum staying at home to look after kids is also a kind of investment. The ROI for time investment in your own kids is much more valuable than $$$. You have higher chances of :
1) having a closer family
2) better behave kids
3) them growing up to be more decent teenagers and adults next time
if you teach them the correct values!!!! :D
I think it is worth the hard work, stress and lesser income if the above are achieved. :) :)
buttercarp
10-02-12, 13:21
I grew up in a family with my Dad as a sole breadwinner. Although we were comfortable financially, he frequently remarked that he felt stressed as a sole earner. I guess tha't why that has been ingrained in me since young.
Being a sole breadwinner myself, I can say that it is stressful for sure. You know that your job is all important and also means you cannot just quit if you feel like it. Plus retrenchment is always out of your control.
yowetan (http://forums.condosingapore.com/member.php?u=27419) - By any chance, your household is making 7-8k basic monthly but not inclusive of commission and/or very good annual bonuses?
Or is 7-8k taken from the annual pay inclusive of everything? I'm 30, took a loan of 700k over 35 years and already concerned about paying it off with my solo monthly of 7k. Single, not married so i guess i can put in more into prepayment if i wish to.
If 7-8k is really the full amount, like all the other brothers and sisters here, i recommend not worrying about your mortgage and invest in a studio and/or put the buying on hold until the property market direction becomes clearer.
yowetan (http://forums.condosingapore.com/member.php?u=27419) - By any chance, your household is making 7-8k basic monthly but not inclusive of commission and/or very good annual bonuses?
Or is 7-8k taken from the annual pay inclusive of everything? I'm 30, took a loan of 700k over 35 years and already concerned about paying it off with my solo monthly of 7k. Single, not married so i guess i can put in more into prepayment if i wish to.
If 7-8k is really the full amount, like all the other brothers and sisters here, i recommend not worrying about your mortgage and invest in a studio and/or put the buying on hold until the property market direction becomes clearer.
7-8k basic monthly household - I work in bank, and we do not have AWS and I have not had any bonus for past few years.
7-8k basic monthly household - I work in bank, and we do not have AWS and I have not had any bonus for past few years.
hmm..strange. thought banking industry always give very big bonus every year one..
:o
hmm..strange. thought banking industry always give very big bonus every year one..
:o
I am at consumer banking.
12k income should be ok for 1 m loan assuming couple in their 30s with no other financial commitments.
My retirement is well protected. I plan to have 6 kids. Each will give me S$2,000 allowance when i retire. So i will have S$12,000 each month. This is smart investment.
Just kidding only. Don't flame me.
What is your current household income then?About $10k/mth. :cheers6:
buttercarp
10-02-12, 14:24
My retirement is well protected. I plan to have 6 kids. Each will give me S$2,000 allowance when i retire. So i will have S$12,000 each month. This is smart investment.
Just kidding only. Don't flame me.
LOL....if that were the case for all of us, we won't be faced with declining birth rates!
And you let her become a SAHM while you slave out the loan?:(What's a SAHM? I think I got the better deal... can't imagine staying home and constantly thinking of how to engage the kids and have them breathing down my neck with their noise, constant demand for undivided attention, etc... take my hats off her... :spliff: Good thing got a helper to aid a bit here and there... :D
hmm..strange. thought banking industry always give very big bonus every year one..
:o
Depends. if you're doing IB, capital markets etc the bonus is attractive. Back office on the other hand is in a sorry state of affairs. Also depends on which banks you're working for. Some aren't even paying bonuses for these few years to their back office staff with increments of 1-3% annually.
The banking industry could do with some reallocation of profits amongst the departments.
My retirement is well protected. I plan to have 6 kids. Each will give me S$2,000 allowance when i retire. So i will have S$12,000 each month. This is smart investment.
Just kidding only. Don't flame me.
Law and medical school is quite expensive for 6 kids..hahaha... unless you plan for them to all be very good salesman....
What's a SAHM? I think I got the better deal... can't imagine staying home and constantly thinking of how to engage the kids and have them breathing down my neck with their noise, constant demand for undivided attention, etc... take my hats off her... :spliff: Good thing got a helper to aid a bit here and there... :D
stay at home mom... :D:D:D
stay at home mom... :D:D:DThx for clarifying... :D
I guess it is safer to have the monthly loan repayment to be one-third of the household income. If monthly repayment is really $6800, the household income should be $20,000 on the safe side. Just in case if there is a loss of one income due to retrenchment, health, etc, there is still one working person with $10,000 (if both husband and wife has the same montlhly salary). There will still be some $ after repaying the loan. Suitation will be better if the project has completed and having rental income. Just my thought.
i went to calculate for 1.5 million @ 2.25% interest for 30 yr
you need to pay around $6800++/mo
i put 2.25% interest so that we don't get offguard with rise of interest rate later in 10 or 20 yr time ..(as compare to the low interest happen at current market now)
Law and medical school is quite expensive for 6 kids..hahaha... unless you plan for them to all be very good salesman....
Hmmm... gotta rethink my retirement plans. Sekali they all good for nothing, i might end up working until 100 years old.
I guess it is safer to have the monthly loan repayment to be one-third of the household income. If monthly repayment is really $6800, the household income should be $20,000 on the safe side. Just in case if there is a loss of one income due to retrenchment, health, etc, there is still one working person with $10,000 (if both husband and wife has the same montlhly salary). There will still be some $ after repaying the loan. Suitation will be better if the project has completed and having rental income. Just my thought.I would have to agree with this... my monthly loan repayment is less than 30% of my household income... if interest rates rise, it may become 40%... no joke! :scared-4:
Hmmm... gotta rethink my retirement plans. Sekali they all good for nothing, i might end up working until 100 years old.Ask them to all get scholarship so free university education and secured work after graduation already.... ;)
You have to look for your own passive income for retirement. Cannot just rely on children. Do not want to be a liability to my children and the nation.
Hmmm... gotta rethink my retirement plans. Sekali they all good for nothing, i might end up working until 100 years old.
That is why cannot play with own roof. Own roof must be fully paid up and play with only investment properties. Not fair for family if had to move the whole family out and move to rented flat. :doh:
I would have to agree with this... my monthly loan repayment is less than 30% of my household income... if interest rates rise, it may become 40%... no joke! :scared-4:
That is why cannot play with own roof. Own roof must be fully paid up and play with only investment properties. Not fair for family if had to move the whole family out and move to rented flat. :doh:I turn it the other way round. Moved to a house under loan mortgage but rent out a fully paid house! :cheers1:House with loan is newer and everything better... Lol! :D
My investment properties are usually 2 bedders. Not enough space for the family. So got to stay put.
I turn it the other way round. Moved to a house under loan mortgage but rent out a fully paid house! :cheers1:House with loan is newer and everything better... Lol! :D
My investment properties are usually 2 bedders. Not enough space for the family. So got to stay put.Good good... u contributing to govt's call for procreation... :cheers1:or you are looking after the elderly too? :)
Good good... u contributing to govt's call for procreation... :cheers1:or you are looking after the elderly too? :)
Too use to staying in landed & like the environment.
wah everyone here so daring and loan so much. i dare not even loan more than 20-25% of combined income.
Depends. if you're doing IB, capital markets etc the bonus is attractive. Back office on the other hand is in a sorry state of affairs. Also depends on which banks you're working for. Some aren't even paying bonuses for these few years to their back office staff with increments of 1-3% annually.
The banking industry could do with some reallocation of profits amongst the departments.
this one sounds like my bank.. i am from the support unit. years back, the traders got ridiculous bonus.. these few years not so good but still better then the support unit.
wah everyone here so daring and loan so much. i dare not even loan more than 20-25% of combined income.Loan what you are comfortable after doing your sums... that's very important! ;)
I turn it the other way round. Moved to a house under loan mortgage but rent out a fully paid house! :cheers1:House with loan is newer and everything better... Lol! :D
My take is:
When young, abled and working - Stay in a place big enough to house parents, kids, pets and self regardless fully paid or otherwise
When old, frail and retired - Stay in hdb 3 room flat near amenities with other half and/ or a pet that is fully paid up with passive income coming in every month :D :D :D
wah biang, you mentioned you nearly kena retrenched and still want to take million dollar loan.:doh::doh:.
Bedok Reservoir waiting for you.
ha~ha:D
yowetan: you really die die wanna rush onto the props bandwagon
wah everyone here so daring and loan so much. i dare not even loan more than 20-25% of combined income.
well, everyone has different risk appetite. although recommended loan repayment should not exceed 35% of income each month, some people are still willing to push their limit to 40% or more if they do not have any other commitment.
Eg. Single, earning 10k, who spends only $3k or less a month.
There are also people who are so risk averse that they rather save every $ they earn in a bank even when banks pay close to nothing for interest. :beats-me-man:
That is why we must educate out children well not just academically strong but financially smart too.Professors do not teach us how to earn $ from jobs but never teach us how to leverage and make more $. :o
well, everyone has different risk appetite. although recommended loan repayment should not exceed 35% of income each month, some people are still willing to push their limit to 40% or more if they do not have any other commitment.
Eg. Single, earning 10k, who spends only $3k or less a month.
There are also people who are so risk averse that they rather save every $ they earn in a bank even when banks pay close to nothing for interest. :beats-me-man:
wah everyone here so daring and loan so much. i dare not even loan more than 20-25% of combined income.
I agree. When I was in my 30s and income > 10K/mth, we dare not even borrow close to 1mill.
May be 1 mil then is very different from now. $1m buy far fewer things now.
I agree. When I was in my 30s and income > 10K/mth, we dare not even borrow close to 1mill.
Any difference is someone with household income of 10k but have two loans of 1m each... And rent out one? So can I say he only worry about his 1m loan?
If you've got a few rental properties, does that counts to your household income? :millie: :millie: :millie:
Important question indeed... Do rental properties count as income or outstanding loan?
And the generation before us laugh at us when WE did a >20 year loan.
Each cohort pushes the envelop ...causing the asset price to inflate.
I was 31 when when I took a 600k loan (combined was above HDB ceiling) and was a nervous for years!
I agree. When I was in my 30s and income > 10K/mth, we dare not even borrow close to 1mill.
That is why we must educate out children well not just academically strong but financially smart too.Professors do not teach us how to earn $ from jobs but never teach us how to leverage and make more $. :o
I think, the word should be 'street smart'. :D
You will find that a number of successful people from humble background. Some do not even have much education. They have little or even nothing in their pocket when they start off.
However, because they are street smart, they know how to grab the opportunity when it presenst itself. Education only gives you a better headstart. It doesn't gaurantee success or $$$.
And the generation before us laugh at us when WE did a >20 year loan.
If interest rate remains this low for many years to come, who would dare to laugh at you for taking a loan with long tenure?!?!?! :D :D
I am at consumer banking.
Seriously, you work in a bank and have such a bad ability to see risk & perform what if scenarios?
As an earlier poster pointed out.
For a 1.5 mil loan @ 2.25% you will be paying 7k / month
What do you plan to eat? Hope you don't need any electricity at home.
You have zero margin for even living, never mind anything goes wrong - which it will.
Do you think 2.25% is historical average interest rate?
If it goes to 4% which is quite normal you will be in negative territory.
You already have 450k loan. Altogether almost 2mil on only 7-8k.
Don't take this as being rude but as Stalingrad said earlier, you are boxing out of your weight.
Anyhow you will be saved from Bedok Resevoir as no bank in their right mind would lend you that much money.
Didn't mean if present players make or lose.
Just saying each generation grew up framing different property investment mindset on quantum/loan period etc.
Only thing remaining the same is that when you're paying - you say 'when can I finish paying this off'...
If interest rate remains this low for many years to come, who would dare to laugh at you for taking a loan with long tenure?!?!?! :D :D
Certainly agree with you. Street smart also need to be financially smart.
I think, the word should be 'street smart'. :D
You will find that a number of successful people from humble background. Some do not even have much education. They have little or even nothing in their pocket when they start off.
However, because they are street smart, they know how to grab the opportunity when it presenst itself. Education only gives you a better headstart. It doesn't gaurantee success or $$$.
And the generation before us laugh at us when WE did a >20 year loan.
Each cohort pushes the envelop ...causing the asset price to inflate.
I was 31 when when I took a 600k loan (combined was above HDB ceiling) and was a nervous for years!
I was already 39 and I was also nervous taking the loan for a similar amount.
Generation before us.....I remember my dad was complaining that his mother (my grandma) was asking him to pay a lot to buy over her house (7000 sq ft bungalow plot in Upper Paya Lebar/Bartley Road junction area). But now even in that location, it is now worth some million $$$?
Now I can't afford to buy over his house.....:( Still living with the in-laws next to the jungle in Upp Thomson where SingTel reception is so bad and only the monkeys come to visit us.
Good times, passive part of the rental income (nett income) can be considered as household income. But bad times, this may disappear. Safer to rule them out but rely on basic monthly household income. Bonus can also go in bad times.
If you've got a few rental properties, does that counts to your household income? :millie: :millie: :millie:
My friend, you must learn about leveraging and take calculated risk. Always have fall back plan.
I was already 39 and I was also nervous taking the loan for a similar amount.
Generation before us.....I remember my dad was complaining that his mother (my grandma) was asking him to pay a lot to buy over her house (7000 sq ft bungalow plot in Upper Paya Lebar/Bartley Road junction area). But now even in that location, it is now worth some million $$$?
Now I can't afford to buy over his house.....:( Still living with the in-laws next to the jungle in Upp Thomson where SingTel reception is so bad and only the monkeys come to visit us.
Yup we probably same cohort (+/- 5 yrs even).
My parent bought 4000 land detached house in D15 for $27,000 and took him 15 years to pay off (single income). And yet my mum complained about that.
Now of course salary is higher - but the asset is much more. Solution? Increase the loan and loan period. Easy....except for the mortgagees.
I was already 39 and I was also nervous taking the loan for a similar amount.
Generation before us.....I remember my dad was complaining that his mother (my grandma) was asking him to pay a lot to buy over her house (7000 sq ft bungalow plot in Upper Paya Lebar/Bartley Road junction area). But now even in that location, it is now worth some million $$$?
Now I can't afford to buy over his house.....:( Still living with the in-laws next to the jungle in Upp Thomson where SingTel reception is so bad and only the monkeys come to visit us.
My friend, you must learn about leveraging and take calculated risk. Always have fall back plan.
That's funny. I bought a few more properties along the way after that and my boss was telling me I was over-leveraged. But all except my last 2 purchases were for rentals.....and the rentals can more or less cover the repayments now that the interest rates are down so I suppose it should be OK.
My take is:
When young, abled and working - Stay in a place big enough to house parents, kids, pets and self regardless fully paid or otherwise
When old, frail and retired - Stay in hdb 3 room flat near amenities with other half and/ or a pet that is fully paid up with passive income coming in every month :D :D :DAgreed Agreed! :D
Only thing remaining the same is that when you're paying - you say 'when can I finish paying this off'...
I agree that the roof over our heads should ideally be fully paid in reasonable timeframe. However, I have a different perspective when investing in property.
For investment properties, I don't really care if the loan tenure is long. If the capital appreciation is high enough for me to reap a good net profit after a few years, I will sell off and settle the loan. Then I will enjoy myself with a fraction of the $$$ and use the rest for more investments.
"I came to this world with nothing.
I leave this world with nothing." (dunno who say one. :D )
However, nothing is said about enjoying life to the fullest in between the two statements above. ;) ;) ;)
ysyap,
Hopefully you already have a 3 room flat within your investment portfolio then... with the latest CM, pte ppty owner cannot buy hdb already....:D :D
But then again, they may change the rules later when situation changes!!!! :spliff: :spliff:
Yup we probably same cohort (+/- 5 yrs even).
My parent bought 4000 land detached house in D15 for $27,000 and took him 15 years to pay off (single income). And yet my mum complained about that.
Now of course salary is higher - but the asset is much more. Solution? Increase the loan and loan period. Easy....except for the mortgagees.
LOL YES very likely we are in the same cohort. I *think* my dad paid around $20,000 or slightly less for his place. Inflation is scary right? :scared-1:
I have used rental income to shorten the capital loan repayment by more than half for my investment property but not now. Happy as long as tenant is helping me to pay loan mortgage and passive income after deducting maintenance fee, loan interest, property tax, etc. :D
That's funny. I bought a few more properties along the way after that and my boss was telling me I was over-leveraged. But all except my last 2 purchases were for rentals.....and the rentals can more or less cover the repayments now that the interest rates are down so I suppose it should be OK.
Same here. My dad pays $10,000.
LOL YES very likely we are in the same cohort. I *think* my dad paid around $20,000 or slightly less for his place. Inflation is scary right? :scared-1:
ysyap,
Hopefully you already have a 3 room flat within your investment portfolio then... with the latest CM, pte ppty owner cannot buy hdb already....:D :D
But then again, they may change the rules later when situation changes!!!! :spliff: :spliff: Me no 3 room flat... me have EA... :cheers6:
BTW what is EA?
Me no 3 room flat... me have EA... :cheers6:
buttercarp
10-02-12, 19:55
BTW what is EA?
EA = executive apartment. The big type of HDB about 1400 sq feet.
It is like the size of a mansionette but is one level instead of duplex.
Can look at HDB website:
http://www.hdb.gov.sg/fi10/fi10321p.nsf/w/BuyingNewFlatExec?OpenDocument
$10k pm gross household income if got savings may be can loan $1.5m? It is all about having that buffer cash to tie over when the rough comes. But yes, property has been the easiest investment so far, don't have to think so much as compared to investing in shares & bonds as don't need to worry the company got accounting fraud, go bankcrupt, CEO disappear with company's cash, company business die, etc! This is especially true in Singapore where so many of those companies have folded or going to die of above reasons: Eg Citiraya (yes yes, not just China-based companies, we have real local ones), Informatics, China Enersave, China Sky, China Print, FibreChem, CAO, etc!
I have colleagues and friends who goes for million valued housing spree with household income of 10k.
I believe they must have done their calculation.
wah everyone here so daring and loan so much. i dare not even loan more than 20-25% of combined income.
Me too... loan is like 15% of household income. But with kids and old parents to feed, can only save little. Really depends on profile... number of kids and how old.g
EA = executive apartment. The big type of HDB about 1400 sq feet.
It is like the size of a mansionette but is one level instead of duplex.
Can look at HDB website:
http://www.hdb.gov.sg/fi10/fi10321p.nsf/w/BuyingNewFlatExec?OpenDocumentThx for replying... :cheers6:
My friend, you must learn about leveraging and take calculated risk. Always have fall back plan.
Yah.... like got rich parents:)
Everyone here seems to grow up in a upper middle income family. Parents all got landed.
I stay HDB one leh... :o Now in biggest debts of my life so far... :scared-3: :scared-1:
IMHO, this is borderline financing. I am not sure if these people seriously sat down to do their calculations, I wonder.
Very little room for error and downturn. There are many chasing the property dream and driving the demand. To me this is not a good sign in terms of market stability.
I have colleagues and friends who goes for million valued housing spree with household income of 10k.
I believe they must have done their calculation.
1988 Loan $ 83,000 for 4 room HDB (Kim Keat Ave) First cherry.
1995 sell $285,000 profit $180,000.
1996 move into 5 room HDB loan $200,000. (Balam Road) Second Cherry.
2006 loan $428,000 for 2 Bedroom @ SouthBank.($535,000)
2011 loan $660,000 from SouthBank.(Cash out)
2011 loan $750,000 for 3 Bedroom PH @ Terrasse.($1,305,800)
Total loan about $1,800,000.
Monthly income $2,400. Rental income $2,400+$4,100=$6,500.
Mortgage = $2,329.14(660,000)+$1,475.76(428,000)=$3,804.9 cash.
Buy Low Sell High.
edwinleeap
11-02-12, 06:31
1988 Loan $ 83,000 for 4 room HDB (Kim Keat Ave) First cherry.
1995 sell $285,000 profit $180,000.
1996 move into 5 room HDB loan $200,000. (Balam Road) Second Cherry.
2006 loan $428,000 for 2 Bedroom @ SouthBank.($535,000)
2011 loan $660,000 from SouthBank.(Cash out)
2011 loan $750,000 for 3 Bedroom PH @ Terrasse.($1,305,800)
Total loan about $1,800,000.
Monthly income $2,400. Rental income $2,400+$4,100=$6,500.
Mortgage = $2,329.14(660,000)+$1,475.76(428,000)=$3,804.9 cash.
Buy Low Sell High.
Do you guys think I am financially overstretched?
Existing loan : 2 mil
Estimated properties' value : 3.6 mil
Combined gross income : 13k monthly
Rental income : 7 k monthly
Monthly instalment est : 6 k monthly
Cpf used to service instalment : 2 k
Cash used to service instalment : 4 k
Any friendly advice on whether I can hold for the long term? Many thanks first!
Do you guys think I am financially overstretched?
Existing loan : 2 mil
Estimated properties' value : 3.6 mil
Combined gross income : 13k monthly
Rental income : 7 k monthly
Monthly instalment est : 6 k monthly
Cpf used to service instalment : 2 k
Cash used to service instalment : 4 k
Any friendly advice on whether I can hold for the long term? Many thanks first!Think you are quite ok but have at least 4 months worth of monthly instalment in cash in case your unit cannot find new tenants during transitions. ;) Your position is actually quite enviable by many... Cheers! :cheers6:
Do you guys think I am financially overstretched?
Existing loan : 2 mil
Estimated properties' value : 3.6 mil
Combined gross income : 13k monthly
Rental income : 7 k monthly
Monthly instalment est : 6 k monthly
Cpf used to service instalment : 2 k
Cash used to service instalment : 4 k
Any friendly advice on whether I can hold for the long term? Many thanks first!
If interest rates go up, likely your instalment will be slightly more than rental income (based on my assumption that rental rates either hold or drop due to large supplies). If you can live with that, you are quite safe.
IMHO, this is borderline financing. I am not sure if these people seriously sat down to do their calculations, I wonder.
Very little room for error and downturn. There are many chasing the property dream and driving the demand. To me this is not a good sign in terms of market stability.
It is becaue for new launches they only need to put down 20% down-payment. And it's progressive payments. They are hoping that by the time the project has TOP, their financial situation will have improved to be able to service the loan comfortably (or else their MOP for HDB is up and they can rent it out to supplement the loan repayments).
I think govt need to do something about cooling down the new launches by increasing the down-payment. Or else the new launch market will be a bubble and the resale market is dead. That is not good for the health of the property market in Singapore.
Do you guys think I am financially overstretched?
Existing loan : 2 mil
Estimated properties' value : 3.6 mil
Combined gross income : 13k monthly
Rental income : 7 k monthly
Monthly instalment est : 6 k monthly
Cpf used to service instalment : 2 k
Cash used to service instalment : 4 k
Any friendly advice on whether I can hold for the long term? Many thanks first!
Should be OK unless you have 2 incomes to service the loan and one gets retrenched or wants to take time off for personal reasons. Then it will be tight.
Is that a 30 year loan? You will be a slave to your loan for most of your working life and better hope that you are able to keep your job.
Not sure how much cash or other investment that you have. Can consider partial repayment when interest rates goes up or requires to top up if really properties drop substantially like what Mr B is predicting. You should work out the nett monthly income (i.e. monthly rental income - monthly maintenance - monthly mortgage - monthly property tax, other miscellaneous fee.)
Do you guys think I am financially overstretched?
Existing loan : 2 mil
Estimated properties' value : 3.6 mil
Combined gross income : 13k monthly
Rental income : 7 k monthly
Monthly instalment est : 6 k monthly
Cpf used to service instalment : 2 k
Cash used to service instalment : 4 k
Any friendly advice on whether I can hold for the long term? Many thanks first!
Do you guys think I am financially overstretched?
Existing loan : 2 mil
Estimated properties' value : 3.6 mil
Combined gross income : 13k monthly
Rental income : 7 k monthly
Monthly instalment est : 6 k monthly
Cpf used to service instalment : 2 k
Cash used to service instalment : 4 k
Any friendly advice on whether I can hold for the long term? Many thanks first!
you are doing good...:cheers1:
but if you want good karma do a bit for the less fortunate like charity work or donate....that way you will have ALL round protection....:D
edwinleeap
11-02-12, 07:28
TE=DC33_2008]Not sure how much cash or other investment that you have. Can consider partial repayment when interest rates goes up or requires to top up if really properties drop substantially like what Mr B is predicting. You should work out the nett monthly income (i.e. monthly rental income - monthly maintenance - monthly mortgage - monthly property tax, other miscellaneous fee.)[/QUOTE]
Agree. There are certainly downside risks such as
1. Lack of tenants
2. Drop in valuation
3. Interest rate hike
4. Lose of job
Selling one property during good times to reduce total loan quantum is a possibility. (Sure and stable, but not making use of leveraging)
Continue to hold all properties, using rental income to reduce loan quantum and save up for new investments and make use of leveraging. (Risky but greater rewards)
Sigh... decisions decisions!
edwinleeap
11-02-12, 07:29
[QUOTE=radha08]you are doing good...:cheers1:
but if you want good karma do a bit for the less fortunate like charity work or donate....that way you will have ALL round protection....:D[/QUOTE
Roger!
TE=DC33_2008]Not sure how much cash or other investment that you have. Can consider partial repayment when interest rates goes up or requires to top up if really properties drop substantially like what Mr B is predicting. You should work out the nett monthly income (i.e. monthly rental income - monthly maintenance - monthly mortgage - monthly property tax, other miscellaneous fee.)
Agree. There are certainly downside risks such as
1. Lack of tenants
2. Drop in valuation
3. Interest rate hike
4. Lose of job
Selling one property during good times to reduce total loan quantum is a possibility. (Sure and stable, but not making use of leveraging)
Continue to hold all properties, using rental income to reduce loan quantum and save up for new investments and make use of leveraging. (Risky but greater rewards)
Sigh... decisions decisions![/quote]
but just to add unfortunately biggest threat to property investors in singapore is our good govt...they are the ones pulling the strings....who knows what they may or may not do next ur guess as good as mine...:o
edwinleeap
11-02-12, 07:35
Agree. There are certainly downside risks such as
1. Lack of tenants
2. Drop in valuation
3. Interest rate hike
4. Lose of job
Selling one property during good times to reduce total loan quantum is a possibility. (Sure and stable, but not making use of leveraging)
Continue to hold all properties, using rental income to reduce loan quantum and save up for new investments and make use of leveraging. (Risky but greater rewards)
Sigh... decisions decisions!
but just to add unfortunately biggest threat to property investors in singapore is our good govt...they are the ones pulling the strings....who knows what they may or may not do next ur guess as good as mine...:o[/QUOTE]
You are so right. When everything is 20% downpayment, things were easier to predict and more flexible. Now with 40% down, it either mean "game over" or "game paused".
IMHO
You are in a good position
With $7k rental, your total income is $20k. At $6k debt serving, your debt to income ratio is 30%. Should be comfortable, but this is just for the properties alone you may have more recurring debt in other areas which want to take into consideration.
Cheers!
Do you guys think I am financially overstretched?
Existing loan : 2 mil
Estimated properties' value : 3.6 mil
Combined gross income : 13k monthly
Rental income : 7 k monthly
Monthly instalment est : 6 k monthly
Cpf used to service instalment : 2 k
Cash used to service instalment : 4 k
Any friendly advice on whether I can hold for the long term? Many thanks first!
On one hand, garment is trying to protect and on the other hand, it restricts investment opportunity. But it is better to have some measures to prevent overheating of the market when the big brothers are having problem. Otherwise, lots of people here will go down with it.
but just to add unfortunately biggest threat to property investors in singapore is our good govt...they are the ones pulling the strings....who knows what they may or may not do next ur guess as good as mine...:o
You are so right. When everything is 20% downpayment, things were easier to predict and more flexible. Now with 40% down, it either mean "game over" or "game paused".[/QUOTE]
edwinleeap
11-02-12, 07:54
IMHO
You are in a good position
With $7k rental, your total income is $20k. At $6k debt serving, your debt to income ratio is 30%. Should be comfortable, but this is just for the properties alone you may have more recurring debt in other areas which want to take into consideration.
Cheers!
Here is the 'bad' case scenario for discussion:
Property price drop 20%
Problem finding tenant (rental income drops 20-30% Rent at discount)
Spouse stops working
Interest rates rises
Existing loan : 2 mil
Estimated properties' value : 2.9 mil
Combined gross income : 7 k monthly
Rental income : 5 k monthly
Monthly instalment est : 9 k monthly
Cpf used to service instalment : 1 k (spouse stops work)
Cash used to service instalment : 8 k
Shortfall for at least the period without some tenants: 3 k
So things can still turn nasty.
Don't seem to add up... I am missing something here...
1988 Loan $ 83,000 for 4 room HDB (Kim Keat Ave) First cherry.
1995 sell $285,000 profit $180,000.
1996 move into 5 room HDB loan $200,000. (Balam Road) Second Cherry.
2006 loan $428,000 for 2 Bedroom @ SouthBank.($535,000)
2011 loan $660,000 from SouthBank.(Cash out)
2011 loan $750,000 for 3 Bedroom PH @ Terrasse.($1,305,800)
Total loan about $1,800,000.
Monthly income $2,400. Rental income $2,400+$4,100=$6,500.
Mortgage = $2,329.14(660,000)+$1,475.76(428,000)=$3,804.9 cash.
Buy Low Sell High.
Here is the 'bad' case scenario for discussion:
Property price drop 20%
Problem finding tenant (rental income drops 20-30% Rent at discount)
Spouse stops working
Interest rates rises
Existing loan : 2 mil
Estimated properties' value : 2.9 mil
Combined gross income : 7 k monthly
Rental income : 5 k monthly
Monthly instalment est : 9 k monthly
Cpf used to service instalment : 1 k (spouse stops work)
Cash used to service instalment : 8 k
Shortfall for at least the period without some tenants: 3 k
So things can still turn nasty.
You haven't factored in property tax, maintenance fees as a recurring expense. Also if you have a car, your car loan may add another 1K monthly. If you have maids + kids, another 1K. Your cash flow will be tight on one income. Do not underestimate the little things that add up eg groceries, electricity, car petrol, meals outside (even fast food is not cheap these days).
If loan interest takes a hike it will be even worse.
If you can hold out for the term of the loan, 7K rental income on top of your own income(s) of 13K is very good. But you re in for the long haul (30 years). Anything can happen. You will also be shocked that even young-ish people are getting gravely ill these days (cancer, heart disease, etc - choi choi choi but it does happen so take care of your health and dont' focus so much on your careers and making money that you neglect your health - it's one thing that money cannot buy back once you've lost it). Ahem and that brings me to another expense - insurance (sorry am not an agent but I thought I should remind you that you need to fork out some money for insurance too).
Do you have mortgage insurance if you holding on for long term? This is additional expense. People ignore this as it can become a liability to the family.
You haven't factored in property tax, maintenance fees as a recurring expense. Also if you have a car, your car loan may add another 1K monthly. If you have maids + kids, another 1K. Your cash flow will be tight on one income. Do not underestimate the little things that add up eg groceries, electricity, car petrol, meals outside (even fast food is not cheap these days).
If loan interest takes a hike it will be even worse.
If you can hold out for the term of the loan, 7K rental income on top of your own income(s) of 13K is very good. But you re in for the long haul (30 years). Anything can happen. You will also be shocked that even young-ish people are getting gravely ill these days (cancer, heart disease, etc - choi choi choi but it does happen so take care of your health and dont' focus so much on your careers and making money that you neglect your health - it's one thing that money cannot buy back once you've lost it). Ahem and that brings me to another expense - insurance (sorry am not an agent but I thought I should remind you that you need to fork out some money for insurance too).
IMHO,
Too many ifs and buts. As you are now, you are good.
Pre-Lehman Brother, people were working on about 0.4 debt to income ratio. Based on your debt of $6k, you will need $15k income to hit 0.4. If you and your wife maintain your $13k income, your rental can drop drastically to $2k and still maintain the 0.4 DTI ratio. What ever it is, in your positon there is room to manoeuvre.
Of course 0.4 is not ideal but as of now you are at 0.3, quite a way to go to 0.4. So I still that maintain that you are alright.
Here is the 'bad' case scenario for discussion:
Property price drop 20%
Problem finding tenant (rental income drops 20-30% Rent at discount)
Spouse stops working
Interest rates rises
Existing loan : 2 mil
Estimated properties' value : 2.9 mil
Combined gross income : 7 k monthly
Rental income : 5 k monthly
Monthly instalment est : 9 k monthly
Cpf used to service instalment : 1 k (spouse stops work)
Cash used to service instalment : 8 k
Shortfall for at least the period without some tenants: 3 k
So things can still turn nasty.
edwinleeap
11-02-12, 08:30
Thanks for all your advice. I am still quite new in property Investment and value allyour inputs. Am striving to make things less risky and more stable. Many thanks
Do you guys think I am financially overstretched?
Existing loan : 2 mil
Estimated properties' value : 3.6 mil
Combined gross income : 13k monthly
Rental income : 7 k monthly
Monthly instalment est : 6 k monthly
Cpf used to service instalment : 2 k
Cash used to service instalment : 4 k
Any friendly advice on whether I can hold for the long term? Many thanks first!
7k to feed the interest ($6k)
and you still got $13k income ... quite safe ,right??
Thanks for all your advice. I am still quite new in property Investment and value allyour inputs. Am striving to make things less risky and more stable. Many thanks
As a newbie you are doing very well (pat on the back). Just be sure you have things covered eg mortgage insurance, medical insurance and do the sums on your other expenditures (eg property tax, maintenance fees, maid salary and levy, kid's expenses - childcare, tuition, car loans, household bills, holidays) to be doubly sure. Be aware that there may be a downward pressure on rentals going forward due to oversupply from projects soon to have TOP.
Thanks for all your advice. I am still quite new in property Investment and value allyour inputs. Am striving to make things less risky and more stable. Many thanks
You are being modest.
With a $3.6M portfoliio worth of properties, I don't think you are new.
But if you are looking to reduce your risks and improve your stability, may I so boldly suggest that you drop one property (I assume you have 3 or more). Cash out the one with the least upside or lowest yield.
wah everyone here so daring and loan so much. i dare not even loan more than 20-25% of combined income.
Maybe one has a 50k/m salary n even if he use 60% of his salary for housing loan, he still has 20k/m left for necessity provided his income is secured.
Not surprise why property market is still selling well. Lots of professionals besides business people are making more than 20k/mth. Household income will be at least $30-40k/mth. A loan of 2 $million is no big issue. Quite a lot of people out there are making more than MX9 ($11000/mth). Even a professor is more than that.
Maybe one has a 50k/m salary n even if he use 60% of his salary for housing loan, he still has 20k/m left for necessity provided his income is secured.
Here is the 'bad' case scenario for discussion:
Property price drop 20%
Problem finding tenant (rental income drops 20-30% Rent at discount)
Spouse stops working
Interest rates rises
Existing loan : 2 mil
Estimated properties' value : 2.9 mil
Combined gross income : 7 k monthly
Rental income : 5 k monthly
Monthly instalment est : 9 k monthly
Cpf used to service instalment : 1 k (spouse stops work)
Cash used to service instalment : 8 k
Shortfall for at least the period without some tenants: 3 k
So things can still turn nasty.
Hi, your gross income is after CPF reduction etc?
Also, where do you stay since you rent your 3++ mil property?
Please advise. Thanks.
edwinleeap
11-02-12, 09:39
You are being modest.
With a $3.6M portfoliio worth of properties, I don't think you are new.
But if you are looking to reduce your risks and improve your stability, may I so boldly suggest that you drop one property (I assume you have 3 or more). Cash out the one with the least upside or lowest yield.
Still new la. Buy first private property only end 2008. Others bought during Lehman crisis. I have thought of selling one to reduce liabilities, but buying back is going to be less profitable and at a higher quantum. So very reluctant to let go and practice "propertism - buy and not sell!".
edwinleeap
11-02-12, 09:42
Hi, your gross income is after CPF reduction etc?
Also, where do you stay since you rent your 3++ mil property?
Please advise. Thanks.
I do not have a single 3+ million property. That is for people with wealth in excess of 10 million? I am staying in 1 and renting the others. Combined portfolio is 3 plus mill that's all. Income quoted is gross earned income. Hope that clarifies.
Yup. Buy and Keep. Especially good FH ones, walking distance to mrt, good rental yield of at least 5%, etc. Unfortunately, the new ones are difficult to get more than 3% yield as most expatriates have limited budget these days (anything more than 5k/mth for fewer than 5 years ago).
Still new la. Buy first private property only end 2008. Others bought during Lehman crisis. I have thought of selling one to reduce liabilities, but buying back is going to be less profitable and at a higher quantum. So very reluctant to let go and practice "propertism - buy and not sell!".
I do not have a single 3+ million property. That is for people with wealth in excess of 10 million? I am staying in 1 and renting the others. Combined portfolio is 3 plus mill that's all. Income quoted is gross earned income. Hope that clarifies.
Both of your property are private? One of them has rental yield of 7kSGD? This is very good; where's their location?
Pardon my poor understanding, gross earned income is GROSS without CPF reduction? Please correct me if I am wrong.
Thanks for sharing your experience.
edwinleeap
11-02-12, 10:01
Both of your property are private? One of them has rental yield of 7kSGD? This is very good; where's their location?
Pardon my poor understanding, gross earned income is GROSS without CPF reduction? Please correct me if I am wrong.
Thanks for sharing your experience.
Yes gross is without CPF reduction.
I sold my HDB and all properties are private condos now (sort of regretted not keeping HDB). Rental income does not come from 1 property only. A property with 7k rental will cost at least 2 to 3 million?
Yes gross is without CPF reduction.
I sold my HDB and all properties are private condos now (sort of regretted not keeping HDB). Rental income does not come from 1 property only. A property with 7k rental will cost at least 2 to 3 million?
Thanks for sharing so much.
Mind if I ask a bit more? How many properties are you holding now?:o
edwinleeap
11-02-12, 10:15
Thanks for sharing so much.
Mind if I ask a bit more? How many properties are you holding now?:o
Still less than a handful la. Nothing compared to the forummers here! :ashamed1:
Inflation at 5% has tilted investors to take on more loans than they normally would.
Seriously, you work in a bank and have such a bad ability to see risk & perform what if scenarios?
As an earlier poster pointed out.
For a 1.5 mil loan @ 2.25% you will be paying 7k / month
What do you plan to eat? Hope you don't need any electricity at home.
You have zero margin for even living, never mind anything goes wrong - which it will.
Do you think 2.25% is historical average interest rate?
If it goes to 4% which is quite normal you will be in negative territory.
You already have 450k loan. Altogether almost 2mil on only 7-8k.
Don't take this as being rude but as Stalingrad said earlier, you are boxing out of your weight.
Anyhow you will be saved from Bedok Resevoir as no bank in their right mind would lend you that much money.
Nope... My friend who earns 8k, the bank allows him to loan up to 2mil. He is only 29.
Nope... My friend who earns 8k, the bank allows him to loan up to 2mil. He is only 29.
What is your friend's occupation?
What is your friend's occupation?
Salesman... Hahaha
Do you guys think I am financially overstretched?
Existing loan : 2 mil
Estimated properties' value : 3.6 mil
Combined gross income : 13k monthly
Rental income : 7 k monthly
Monthly instalment est : 6 k monthly
Cpf used to service instalment : 2 k
Cash used to service instalment : 4 k
Any friendly advice on whether I can hold for the long term? Many thanks first!
Very similar profile to me.
Existing loan: 2.3mil
Estimate properties value: 4mil
Monthly income: 25k
Rental income: 11k
Monthly cash installment: 6k
Monthly cpf installment: 2k
Currently stay in humble 5room HDB flat..
30yrs old.
Salesman... Hahaha
Your friend inspired me.
edwinleeap
11-02-12, 10:59
Very similar profile to me.
Existing loan: 2.3mil
Estimate properties value: 4mil
Monthly income: 25k
Rental income: 11k
Monthly cash installment: 6k
Monthly cpf installment: 2k
Currently stay in humble 5room HDB flat..
30yrs old.
ha ha. But you have the HDB!!! I wish I have kept the HDB and continue to stay there.
Nope. As a matter of fact, I still have an outstanding loan of 450k for my newly bought HDB flat.
This is stretching it abit given ur net load is almost 2m. Assuming u cannot rent out ur hdb as its newly bought. With a 8k pm is stretch. Keep ur loan payment to 30% of ur total net income. Remember 1% int not going to be forever.
Hi All, I fully aware of my financial limitation; hence I am just hypothectically fiddling with the idea of "flipping" and "riding" on the current property faze.
As much as many others have shared their secret in property investment, I agreed that my household income of 8k (max) seems too little, too helpless to invest into 1.2 to 1.5 million dollars property.
My immediate concern is to pay up my HDB 450k loan. Moving to my next query - is it wise to clear the principle amount as low as possible given the current low interest environment? or leveraging by paying more cash upfront and leveraging on bank sibor interest rate of 1.2%, keeping my principle amount intact?
Criticism, opinions and suggestions are welcome.
Wow... $25k mthly single income at 30yrs old... you must be a high flyer
Very similar profile to me.
Existing loan: 2.3mil
Estimate properties value: 4mil
Monthly income: 25k
Rental income: 11k
Monthly cash installment: 6k
Monthly cpf installment: 2k
Currently stay in humble 5room HDB flat..
30yrs old.
Wow... $25k mthly single income at 30yrs old... you must be a high flyer
I am not lah.
I study Neigbourhood school n local poly.
My parents earns 2k per month when I was young.
My 1st pay cheque only 1.5k
But I start saving n investing at a young age.
N start my own business 5 years ago with the little saving I had.
I know I can never be as successful as Peter Lim, Francis Yeoh etc,
But I am contented n happy as who I am.
Anyone everyone can buy their 1st pte pty. Just keep ur feet on the ground n work hard + invest smart. Cheers...
Very similar profile to me.
Existing loan: 2.3mil
Estimate properties value: 4mil
Monthly income: 25k
Rental income: 11k
Monthly cash installment: 6k
Monthly cpf installment: 2k
Currently stay in humble 5room HDB flat..
30yrs old.
So for your case.. assuming you took 80% loan, you have put in around $550k to purchase a property, but the value now is $4mil which is a rpofit of 1.7mil. Cash on Cash return is around 300% !
tHAT'S the beauty of properties in the right cycle.. use only $500k can control $2.8mil(time of purchase) of properties and profit $1.7mil
But too bad at this juncture, new property buyers will not be getting the type of rental yield or return with the govt. clampdown.
Don't seem to add up... I am missing something here...
You are right.
Stay in France right now, given housing allowance for 660 euro, Cost of Living Allowance (COLA) of $4,000. Brought a 3 room HDB for in law for $65,000 in 1995 ($95,000-$30,000) now fully pay. Let me think what else I miss.
Temperature now is -6 degree C
https://lh4.googleusercontent.com/-bxUnjpZEl2U/Tyr0tXAXJKI/AAAAAAAAGnk/IAJHENwnNjk/s800/2012-02-02+18.37.42.jpg
Is it a local bank? 8K for $2 mil loan is quite a stretch.
Nope... My friend who earns 8k, the bank allows him to loan up to 2mil. He is only 29.
Hi All, I fully aware of my financial limitation; hence I am just hypothectically fiddling with the idea of "flipping" and "riding" on the current property faze.
As much as many others have shared their secret in property investment, I agreed that my household income of 8k (max) seems too little, too helpless to invest into 1.2 to 1.5 million dollars property.
My immediate concern is to pay up my HDB 450k loan. Moving to my next query - is it wise to clear the principle amount as low as possible given the current low interest environment? or leveraging by paying more cash upfront and leveraging on bank sibor interest rate of 1.2%, keeping my principle amount intact?
Criticism, opinions and suggestions are welcome.
properly u need to watch out for the next cycle of property down turn, mean while built up your financial muscle while waiting for the next down turn
Do you guys think I am financially overstretched?
Existing loan : 2 mil
Estimated properties' value : 3.6 mil
Combined gross income : 13k monthly
Rental income : 7 k monthly
Monthly instalment est : 6 k monthly
Cpf used to service instalment : 2 k
Cash used to service instalment : 4 k
Any friendly advice on whether I can hold for the long term? Many thanks first!
Not an advice but rather what I would do in your case. To take 2M loan, I would have at least 50% liquid asset. You never know when the perfect storm will strike with property bubble burst, high interest rate, dead rental mkt, unemployment etc.
Or I would cash out the 1.6M profit (not sure if you can or willing in your case) and earn 6-7k passive income based on 5% interest with zero loan.
Overall, I think you are in a very good position.
Hi All, I fully aware of my financial limitation; hence I am just hypothectically fiddling with the idea of "flipping" and "riding" on the current property faze.
As much as many others have shared their secret in property investment, I agreed that my household income of 8k (max) seems too little, too helpless to invest into 1.2 to 1.5 million dollars property.
My immediate concern is to pay up my HDB 450k loan. Moving to my next query - is it wise to clear the principle amount as low as possible given the current low interest environment? or leveraging by paying more cash upfront and leveraging on bank sibor interest rate of 1.2%, keeping my principle amount intact?
Criticism, opinions and suggestions are welcome.
I will chose to pay minimum for HDB. Can get both chery better still.
Wait for the next cycle, as what I have done in 1996.
Is it a local bank? 8K for $2 mil loan is quite a stretch.
Yes local bank. That was in 2010. The key was his young age.
The monthly repayment is about 55% of his monthly pay over 40 years.
I will chose to pay minimum for HDB. Can get both chery better still.
Wait for the next cycle, as what I have done in 1996.
The watertown in Punggol makes me wonder if the next cycle will even take place.
Not sure if this total estimated property value includes his own home. You are in a much better position if it is not. Self employed people are usually worried about economic crisis. Not sure if your business is immune to recession. Otherwise, the situation can be worst in downturn where you need to inject capital into the business to start afloat.
Not an advice but rather what I would do in your case. To take 2M loan, I would have at least 50% liquid asset. You never know when the perfect storm will strike with property bubble burst, high interest rate, dead rental mkt, unemployment etc.
Or I would cash out the 1.6M profit (not sure if you can or willing in your case) and earn 6-7k passive income based on 5% interest with zero loan.
Overall, I think you are in a very good position.
The watertown in Punggol makes me wonder if the next cycle will even take place.
Where were u in 1996? Now is like in 1996.
Maybe one has a 50k/m salary n even if he use 60% of his salary for housing loan, he still has 20k/m left for necessity provided his income is secured.
Yeah, some people paying 9-10k income tax every month!!! More than what many pay for property loan. Those will likely play in the CCR league.
Where were u in 1996? Now is like in 1996.
I think I was in Singapore Polytechnic Canteen 2 having Mac Donald then.
In life, one must take calculated risk for more gain.
Yes local bank. That was in 2010. The key was his young age.
The monthly repayment is about 55% of his monthly pay over 40 years.
Sorry to intercept; Is it wise for me to take up 1.2 to 1.5 million loan with a household income of around 7-8kSGD with 30 years loan? I like to get one landed terrace unit.
Be prudent!
Very similar profile to me.
Existing loan: 2.3mil
Estimate properties value: 4mil
Monthly income: 25k
Rental income: 11k
Monthly cash installment: 6k
Monthly cpf installment: 2k
Currently stay in humble 5room HDB flat..
30yrs old.
Wow, wow, wow!!!
You haven't factored in property tax, maintenance fees as a recurring expense. Also if you have a car, your car loan may add another 1K monthly. If you have maids + kids, another 1K. Your cash flow will be tight on one income. Do not underestimate the little things that add up eg groceries, electricity, car petrol, meals outside (even fast food is not cheap these days).
Maid easily $600 if include govt levy.... kids school and enrichment easily $1k per kid... what about their tietiary education...and the risk that do we still have the same income when you are 50 years old?
Dont bother on paying up the hdb loan. Save cash and cpf, pounce on next opportunity..and adjust your appetite.
Hi All, I fully aware of my financial limitation; hence I am just hypothectically fiddling with the idea of "flipping" and "riding" on the current property faze.
As much as many others have shared their secret in property investment, I agreed that my household income of 8k (max) seems too little, too helpless to invest into 1.2 to 1.5 million dollars property.
My immediate concern is to pay up my HDB 450k loan. Moving to my next query - is it wise to clear the principle amount as low as possible given the current low interest environment? or leveraging by paying more cash upfront and leveraging on bank sibor interest rate of 1.2%, keeping my principle amount intact?
Criticism, opinions and suggestions are welcome.
Here is the 'bad' case scenario for discussion:
Property price drop 20%
Problem finding tenant (rental income drops 20-30% Rent at discount)
Spouse stops working
Interest rates rises
Existing loan : 2 mil
Estimated properties' value : 2.9 mil
Combined gross income : 7 k monthly
Rental income : 5 k monthly
Monthly instalment est : 9 k monthly
Cpf used to service instalment : 1 k (spouse stops work)
Cash used to service instalment : 8 k
Shortfall for at least the period without some tenants: 3 k
So things can still turn nasty.
It depends on how much the interest rates rise right? If the loan interest payments is higher than the rental, it becomes very bad for you I think.
What is the current rental yield now? Wonder when and how hight the interest rates will rise.
I think I was in Singapore Polytechnic Canteen 2 having Mac Donald then.
Then remember this chart. Buy low Sell high.
http://www.singaporerealestate.info/property%20price%20index%201960%20to%202010.gif
Can I ask why forummers like to paynupmthe loan as quickly as possible? Costs of funds so cheap... Stretchnall the way
Hi All, I fully aware of my financial limitation; hence I am just hypothectically fiddling with the idea of "flipping" and "riding" on the current property faze.
As much as many others have shared their secret in property investment, I agreed that my household income of 8k (max) seems too little, too helpless to invest into 1.2 to 1.5 million dollars property.
My immediate concern is to pay up my HDB 450k loan. Moving to my next query - is it wise to clear the principle amount as low as possible given the current low interest environment? or leveraging by paying more cash upfront and leveraging on bank sibor interest rate of 1.2%, keeping my principle amount intact?
Criticism, opinions and suggestions are welcome.
you are prudent enough to not overstretch with your earlier mount sinai plan. it is good to leverage, though timing must be right. prepare yourself ready for that day, by saving, reducing unnecessary expenses (though not stinging on importants), reading the forums to gauge sentiments, etc.
the problem comes when you get spectator fatigue and throw in that towel. that's when the `gongtao' of the luxurious showroom and marketing hype make you sign your booking fee to avoid losing out... only to regret later and lose 1.25% on default.
the market direction is still not very clear. what is clear is that the upside gradient / slope is plateauing for now... is it coming down, consolidating, or shooting straight up (unlikely!)? who knows? in fact all these are outside our hands and are in the hands of the market / news makers (EU loans approve or not, wars, etc).
at this moment, the only way you can enter the market (carefully of course, selected developments) is to leverage on like-minded friends, who do not mind sharing with you for investments. must be good friends with excellent holding power who can pull you along, both in terms of finance as well as investment acumen. difficult to find though, cos both can hold each other back. i had tremendous push 3 years back from a guru friend who handheld me from conservative resistant investor (rejected several projects which had multiplied) to more knowledgeable now, able to decide on my own.
that's why many investors are lured in by those property sharing / leveraging seminars. i strongly advise against these, but that's another topic for discussion.
you already made good with your latest divestment and reinvestment in hdb. memorise the previous chart! take care.
edwinleeap
11-02-12, 16:54
you are prudent enough to not overstretch with your earlier mount sinai plan. it is good to leverage, though timing must be right. prepare yourself ready for that day, by saving, reducing unnecessary expenses (though not stinging on importants), reading the forums to gauge sentiments, etc.
the problem comes when you get spectator fatigue and throw in that towel. that's when the `gongtao' of the luxurious showroom and marketing hype make you sign your booking fee to avoid losing out... only to regret later and lose 1.25% on default.
the market direction is still not very clear. what is clear is that the upside gradient / slope is plateauing for now... is it coming down, consolidating, or shooting straight up (unlikely!)? who knows? in fact all these are outside our hands and are in the hands of the market / news makers (EU loans approve or not, wars, etc).
at this moment, the only way you can enter the market (carefully of course, selected developments) is to leverage on like-minded friends, who do not mind sharing with you for investments. must be good friends with excellent holding power who can pull you along, both in terms of finance as well as investment acumen. difficult to find though, cos both can hold each other back. i had tremendous push 3 years back from a guru friend who handheld me from conservative resistant investor (rejected several projects which had multiplied) to more knowledgeable now, able to decide on my own.
that's why many investors are lured in by those property sharing / leveraging seminars. i strongly advise against these, but that's another topic for discussion.
you already made good with your latest divestment and reinvestment in hdb. memorise the previous chart! take care.
Yes timing is extremely important. Buying low really helps reduce the risk factors a lot!
The "buy" decision comes from the buyer. Do not be coerced by anyone but only by calculated reasoning.
Yes timing is extremely important. Buying low really helps reduce the risk factors a lot!
The "buy" decision comes from the buyer. Do not be coerced by anyone but only by calculated reasoning.
yes, but the decision to sell should be based on current market price right? Because this is what you will get if you sell now.
Example, if one buys a condo at 1million dollars, 800k loan.
Now it is 1.3million. Should one sell?
I never rent out a condo so I am quite blur at this. But the following is my SIMPLISTIC calculation.
If you can rent the condo out at 3.5k/month= 42k/per year.
10% property tax=4.2k.
condo maintenance fees=$250*12=3k
miscellaneous fees (agent/repair/etc)= 2k??
So you end up with 35k per year, which is around 2.8% yield.
Let's say your loan is at 1.5% interest rate. Should I apply 1.5% to 800k or 1.3million? I think we should apply it to 1.3 million because if you sell the house at 1.3million not 800k. You can make use of the extra 500k. Example, you can pay of the 800k loan + 500k (of your other property loan)
So your yield is only 2.8%-1.5%= 1.3%. If condo is 99years, I would assume it will depreciate normally by 1% per annum (all other things being equal). So you end up with only a 0.3% yield.
A 0.3% yield is rather small to take such a big risk especially if you don't see any upside in the property market from now on. And furthermore if the interest rates rise any higher than 1.5%, it will make it not economical to hold on to the property. People will realise this and start selling....
Is my "theory" correct?
Your calculation is wrong because:
1) You don't own the $1.3m, since $800k is not your money. Hence your return should be based on your own capital which is only $500k.
2) Interest only count for the loan of $800k since easier to compare to alternative investments for your own capital of $500k.
3) Considering the above, your actual return on your $500k is much much higher than what you calculated, especially now the loan interest is about 1%, not 1.5%. That is the advantage of leverage, but also the disadvantage of leverage because your loss get magnified! :banghead:
4) Is it any wonder so many citizens are still buying new launch and using whoever family names they can lay their hand on? They are carrying leverage to a "new art" level to overcome the 60% LTV for 2nd property (while 80% for 1st property), 4 years SSD, ABSD ...! :eek:
Imposing ABSD on foreigners to "cool" property market got use mah since it is actually Singapore citizens who are creating bubble in OCR? :scared-1:
Heard so many coffee shop talkers saying either they are plain ignorant or because of ??? :scared-2:
yes, but the decision to sell should be based on current market price right? Because this is what you will get if you sell now.
Example, if one buys a condo at 1million dollars, 800k loan.
Now it is 1.3million. Should one sell?
I never rent out a condo so I am quite blur at this. But the following is my SIMPLISTIC calculation.
If you can rent the condo out at 3.5k/month= 42k/per year.
10% property tax=4.2k.
condo maintenance fees=$250*12=3k
miscellaneous fees (agent/repair/etc)= 2k??
So you end up with 35k per year, which is around 2.8% yield.
Let's say your loan is at 1.5% interest rate. Should I apply 1.5% to 800k or 1.3million? I think we should apply it to 1.3 million because if you sell the house at 1.3million not 800k. You can make use of the extra 500k. Example, you can pay of the 800k loan + 500k (of your other property loan)
So your yield is only 2.8%-1.5%= 1.3%. If condo is 99years, I would assume it will depreciate normally by 1% per annum (all other things being equal). So you end up with only a 0.3% yield.
A 0.3% yield is rather small to take such a big risk especially if you don't see any upside in the property market from now on. And furthermore if the interest rates rise any higher than 1.5%, it will make it not economical to hold on to the property. People will realise this and start selling....
Is my "theory" correct?
Your calculation is wrong because:
1) You don't own the $1.3m, since $800k is not your money. Hence your return should be based on your own capital which is only $500k.
2) Interest only count for the loan of $800k since easier to compare to alternative investments for your own capital of $500k.
3) Considering the above, your actual return on your $500k is much much higher than what you calculated, especially now the loan interest is about 1%, not 1.5%. That is the advantage of leverage, but also the disadvantage of leverage because your loss get magnified! :banghead:
4) Is it any wonder so many citizens are still buying new launch and using whoever family names they can lay their hand on? They are carrying leverage to a "new art" level to overcome the 60% LTV for 2nd property (while 80% for 1st property), 4 years SSD, ABSD ...! :eek:
Your maths is wrong. My scenario's initial capital is 200k downpayment. And your way of calculating is basically looking at how much money your 200k is making for you.
It doesn't tell you when you should sell because it never takes into account the current market price. Even if your condo selling climb up to 2million, using your method, the numbers are still the same. As all you look is the interest rate on your loan and rental income.
I think you must put in the capital appreciation somewhere in your equations. If you can sell your condo at 1.3million and you don't, there is an opportunity cost involved. As I said, you can use the profits to offset other housing loans and thus make some money. Of course, you can do other things with the money but for SIMPLICITY I assumed you use it to offset other housing loans.
Simple logic. If your condo price goes up to 3million and rental remains flat, it is a no brainer to sell as you will free up huge amount of money which can be used to pay of other loans (ZERO risk investment).
If the interest rate is 1%, then it just change the Yield from 0.3% to 0.8%. And to get the 0.8% you are banking on 1% interest rates.... which is hardly reassuring.
edwinleeap
11-02-12, 20:39
yes, but the decision to sell should be based on current market price right? Because this is what you will get if you sell now.
Example, if one buys a condo at 1million dollars, 800k loan.
Now it is 1.3million. Should one sell?
I never rent out a condo so I am quite blur at this. But the following is my SIMPLISTIC calculation.
If you can rent the condo out at 3.5k/month= 42k/per year.
10% property tax=4.2k.
condo maintenance fees=$250*12=3k
miscellaneous fees (agent/repair/etc)= 2k??
So you end up with 35k per year, which is around 2.8% yield.
Let's say your loan is at 1.5% interest rate. Should I apply 1.5% to 800k or 1.3million? I think we should apply it to 1.3 million because if you sell the house at 1.3million not 800k. You can make use of the extra 500k. Example, you can pay of the 800k loan + 500k (of your other property loan)
So your yield is only 2.8%-1.5%= 1.3%. If condo is 99years, I would assume it will depreciate normally by 1% per annum (all other things being equal). So you end up with only a 0.3% yield.
A 0.3% yield is rather small to take such a big risk especially if you don't see any upside in the property market from now on. And furthermore if the interest rates rise any higher than 1.5%, it will make it not economical to hold on to the property. People will realise this and start selling....
Is my "theory" correct?
Selling the house does free up the 500k that can generate income of a certain percentage. But things may not be so simple. Selling the house also free up the 800k that does not earn rental for you anymore. So how? Buy another property and pay the duties and fees? Buy new and wait for completion and lose rental income? Buy resale and lock up the 40% downpayment and probably get a lower rental yield?
Very cheeeem
Selling the house does free up the 500k that can generate income of a certain percentage. But things may not be so simple. Selling the house also free up the 800k that does not earn rental for you anymore. So how? Buy another property and pay the duties and fees? Buy new and wait for completion and lose rental income? Buy resale and lock up the 40% downpayment and probably get a lower rental yield?
Very cheeeem
For your case, I simplified by assuming you use the proceeds to pay of all your housing loans. 800k for the condo you are selling and 500k for other housing loans.
This is might not be the BEST way to use your money but it is ZERO risk. So if calculating using this method shows that it is worth it to sell, you should 100% sell because you can definitely make more money by selling.
With a 1% interest rate, continuing to rent out is still worth it. But when interest rate hits 1.8%, then it is even. Anything more than 1.8% one should sell.
The BIG question is of course when is interest rate rising... You don't want to be caught when it goes to 1.8% cuz that is when everyone will be selling....
No I don't think I am wrong in my calculation. I am referring to your own capital of $500k (market value) which is what you get if you sell the property for $1.3m and pay off the existing loan of $0.8m (not the original $200k initial capital anymore).
To know when you should sell, you should look at the return you can get from your own capital of $500k if you sell the $1.3m property. However, consideration of the return should be considered over the longer term and the volatility and risk involved.
Your maths is wrong. My scenario's initial capital is 200k downpayment. And your way of calculating is basically looking at how much money your 200k is making for you.
It doesn't tell you when you should sell because it never takes into account the current market price. Even if your condo selling climb up to 2million, using your method, the numbers are still the same. As all you look is the interest rate on your loan and rental income.
I think you must put in the capital appreciation somewhere in your equations. If you can sell your condo at 1.3million and you don't, there is an opportunity cost involved. As I said, you can use the profits to offset other housing loans and thus make some money. Of course, you can do other things with the money but for SIMPLICITY I assumed you use it to offset other housing loans.
Simple logic. If your condo price goes up to 3million and rental remains flat, it is a no brainer to sell as you will free up huge amount of money which can be used to pay of other loans (ZERO risk investment).
If the interest rate is 1%, then it just change the Yield from 0.3% to 0.8%. And to get the 0.8% you are banking on 1% interest rates.... which is hardly reassuring.
teddybear[/B]]
Your calculation is wrong because:
1) You don't own the $1.3m, since $800k is not your money. Hence your return should be based on your own capital which is only $500k.
2) Interest only count for the loan of $800k since easier to compare to alternative investments for your own capital of $500k.
3) Considering the above, your actual return on your $500k is much much higher than what you calculated, especially now the loan interest is about 1%, not 1.5%. That is the advantage of leverage, but also the disadvantage of leverage because your loss get magnified! :banghead:
4) Is it any wonder so many citizens are still buying new launch and using whoever family names they can lay their hand on? They are carrying leverage to a "new art" level to overcome the 60% LTV for 2nd property (while 80% for 1st property), 4 years SSD, ABSD ...! :eek:
No, he doesn't need to buy another property. He can spend it to enjoy, or buy shares, bonds, structured deposits, endowment funds, unit trusts etc. It is just that none of those will get you good long-term return considering the risk and volatility involved.
Selling the house does free up the 500k that can generate income of a certain percentage. But things may not be so simple. Selling the house also free up the 800k that does not earn rental for you anymore. So how? Buy another property and pay the duties and fees? Buy new and wait for completion and lose rental income? Buy resale and lock up the 40% downpayment and probably get a lower rental yield?
Very cheeeem
new2mondrian
11-02-12, 22:30
Nope... My friend who earns 8k, the bank allows him to loan up to 2mil. He is only 29.
OMG... Either MAS is sleeping, or the banks have an amazing risk appetite. Your friend is taking up the loan ALONE, or he is entering into the loan jointly with his partner who also earns 8k? That makes a sea of difference.
OMG... Either MAS is sleeping, or the banks have an amazing risk appetite. Your friend is taking up the loan ALONE, or he is entering into the loan jointly with his partner who also earns 8k? That makes a sea of difference.
Because the banks believe in the govt who will prop up property prices so that it will not fall too much. So can still sell off the apartment and get money back. Haha
new2mondrian
11-02-12, 23:00
What is worryingly is that in recent times, I know of friends/relatives who do NOT have the means to cough up the 40% downpayment for 2nd property, but still entering into the market. Their justification is simply - we know we do not sufficient cash/CPF, BUT we are getting a new launch which means we don't have to cough up the 40% straightaway. By the time the property TOP in 2015 or beyond, we will have enough.
That calls for an assumption that they will retain their jobs and be able to pay up as and when the developer calls for payment. To me that is a huge assumption especially in this economic climate.
Not too long ago in around 07/08, a brand new FH property around Potong Pasir could be bought for around $650-$750psf. At 20% downpayment, even if market tanks, the banks' exposure is at max $600psf. Today even a 99yr LH in Punggol is going for $1350psf. At 40% downpayment the banks' exposure is still in excess of $800psf. Has economic fundamentals changed so drastically over 5 years? I do not know. Perhaps it has (since market behavior seems to indicate thus).
yes, but the decision to sell should be based on current market price right? Because this is what you will get if you sell now.
Example, if one buys a condo at 1million dollars, 800k loan.
Now it is 1.3million. Should one sell?
I never rent out a condo so I am quite blur at this. But the following is my SIMPLISTIC calculation.
If you can rent the condo out at 3.5k/month= 42k/per year.
10% property tax=4.2k.
condo maintenance fees=$250*12=3k
miscellaneous fees (agent/repair/etc)= 2k??
So you end up with 35k per year, which is around 2.8% yield.
Let's say your loan is at 1.5% interest rate. Should I apply 1.5% to 800k or 1.3million? I think we should apply it to 1.3 million because if you sell the house at 1.3million not 800k. You can make use of the extra 500k. Example, you can pay of the 800k loan + 500k (of your other property loan)
So your yield is only 2.8%-1.5%= 1.3%. If condo is 99years, I would assume it will depreciate normally by 1% per annum (all other things being equal). So you end up with only a 0.3% yield.
A 0.3% yield is rather small to take such a big risk especially if you don't see any upside in the property market from now on. And furthermore if the interest rates rise any higher than 1.5%, it will make it not economical to hold on to the property. People will realise this and start selling....
Is my "theory" correct?
So it looks like it is best to put this 200k into CPF? Rather risk free.
What is worryingly is that in recent times, I know of friends/relatives who do NOT have the means to cough up the 40% downpayment for 2nd property, but still entering into the market. Their justification is simply - we know we do not sufficient cash/CPF, BUT we are getting a new launch which means we don't have to cough up the 40% straightaway. By the time the property TOP in 2015 or beyond, we will have enough.
That calls for an assumption that they will retain their jobs and be able to pay up as and when the developer calls for payment. To me that is a huge assumption especially in this economic climate.
Not too long ago in around 07/08, a brand new FH property around Potong Pasir could be bought for around $650-$750psf. At 20% downpayment, even if market tanks, the banks' exposure is at max $600psf. Today even a 99yr LH in Punggol is going for $1350psf. At 40% downpayment the banks' exposure is still in excess of $800psf. Has economic fundamentals changed so drastically over 5 years? I do not know. Perhaps it has (since market behavior seems to indicate thus).
But they pay the next 20% upon completion of foundation, not upon TOP. They bought without knowing this? Omg, fire sales coming..
new2mondrian
12-02-12, 00:31
But they pay the next 20% upon completion of foundation, not upon TOP. They bought without knowing this? Omg, fire sales coming..
yeah.... to them it's still 20% for a long while. maybe that's why new launches are selling so well. let's hope economy keeps humming along. otherwise a lot of pain is going round, especially for those with multiple dependents (e.g. kids, elderly parents).
yeah.... to them it's still 20% for a long while. maybe that's why new launches are selling so well. let's hope economy keeps humming along. otherwise a lot of pain is going round, especially for those with multiple dependents (e.g. kids, elderly parents).
If not in property, then where do they save the money? Banks are offering close to 0% for savings while inflation is about 5% (if you believe the official figure). Stocks and gold are quite volatile, and lack prestige and utility compared to properties.
I think it is good to buy for own-stay if you have the holding power, even if you don't need it immediately after TOP. The era of cheap land and construction is over in Singapore.
Despite government's promise of waves of GLS, I believe it is only temporary because land for residential development is running out at OCR and around MRT stations (I believe no more in CCR). Beyond 2015, I think the government will have problems finding land at the mentioned locations for GLS. The sale of the Bartley Residences land at the Bodhi tree clearly shows that the government is running out of normal land at OCR for GLS.
No I don't think I am wrong in my calculation. I am referring to your own capital of $500k (market value) which is what you get if you sell the property for $1.3m and pay off the existing loan of $0.8m (not the original $200k initial capital anymore).
To know when you should sell, you should look at the return you can get from your own capital of $500k if you sell the $1.3m property. However, consideration of the return should be considered over the longer term and the volatility and risk involved.
Ok I understand your point.
Then I think our equations are the same what... then why you say I am wrong?
except I simplified by assuming that one uses the freed up capital to pay of other housing loans.
using your method.
Income is around 33k/year ( I noticed i made a calculation error as said 35k previously)
Depreciation for a 99 year property is simplified as 1% per year. 13k/year.
Your interest payment for 800k loan at 1% is around 8k/year.
So net income is 12k per year.So Yield for your 500k "capital" is 2.4%.
So it still does not make sense to sell your house and free up the 500k.
But if interest rates is 1.8%,
your 800k loan interest is 14.4k/year.
And your net income is 5.6k/year and your Yield for the 500k drops to 1.12% which is lower than your 1.8% housing loan interest rate. (there is a delta because I made an error of 2k earlier)
The conclusion is the same.
I think the 1% depreciation I put in for 99 year property has a big effect. But I think we must put something in else how to differentiate FH and LH? FH has much lower rental yield but FH property don't depreciate due to the lease running out.
We should avoid all 99lh property if we based on above calculation.
Ironically, prices of 99lh property do not depreciate 1% annually.
You haven't factored in property tax, maintenance fees as a recurring expense. Also if you have a car, your car loan may add another 1K monthly. If you have maids + kids, another 1K. Your cash flow will be tight on one income. Do not underestimate the little things that add up eg groceries, electricity, car petrol, meals outside (even fast food is not cheap these days).
If loan interest takes a hike it will be even worse.
If you can hold out for the term of the loan, 7K rental income on top of your own income(s) of 13K is very good. But you re in for the long haul (30 years). Anything can happen. You will also be shocked that even young-ish people are getting gravely ill these days (cancer, heart disease, etc - choi choi choi but it does happen so take care of your health and dont' focus so much on your careers and making money that you neglect your health - it's one thing that money cannot buy back once you've lost it). Ahem and that brings me to another expense - insurance (sorry am not an agent but I thought I should remind you that you need to fork out some money for insurance too).
I am a Malaysian,on top of the property tax,maintenance fees,does one need to pay income tax on rental property?Is it part of the cost to determine rental yield?
Landlords - Possible not to declare rental income? If paiseh can PM me you answer ;)
450k is still a huge amount of debt to clear, imo. :doh:
And before you move to the next stage, IRAS would also want to know how you can afford to over leverage yourself. There are cases where they write in to u to give a response and if the response is iffy, time to lah kopi with them.
. How many of us here have that letter ? .
:scared-2:
Landlords - Possible not to declare rental income? If paiseh can PM me you answer ;)
Is that a trick question ? ;)
Ironically, prices of 99lh property do not depreciate 1% annually.
It's not linear. It escalates after 40yrs.
Frankly SG is so young, no one has really seen his LH properties going to 0 yet. You should watch Arcadia saga. Owners now suddenly wake up it's LH and lease is running out, and now complaining " pty value going down" and want gov to do something.
We should avoid all 99lh property if we based on above calculation.
Ironically, prices of 99lh property do not depreciate 1% annually.
1% is arbitrary. I have to put a number. you can put 0.5% or 2%. It is up to you.
As someone else have said, it is probably not linear. It could be bigger as the property gets older.
This is really worrying. Price has really gone up so much in the last few years. Current price at Punggol is equivalent to price of a FH D1 3 years ago. Everyone is buying a hope in the future.
What is worryingly is that in recent times, I know of friends/relatives who do NOT have the means to cough up the 40% downpayment for 2nd property, but still entering into the market. Their justification is simply - we know we do not sufficient cash/CPF, BUT we are getting a new launch which means we don't have to cough up the 40% straightaway. By the time the property TOP in 2015 or beyond, we will have enough.
That calls for an assumption that they will retain their jobs and be able to pay up as and when the developer calls for payment. To me that is a huge assumption especially in this economic climate.
Not too long ago in around 07/08, a brand new FH property around Potong Pasir could be bought for around $650-$750psf. At 20% downpayment, even if market tanks, the banks' exposure is at max $600psf. Today even a 99yr LH in Punggol is going for $1350psf. At 40% downpayment the banks' exposure is still in excess of $800psf. Has economic fundamentals changed so drastically over 5 years? I do not know. Perhaps it has (since market behavior seems to indicate thus).
There LH properties where prices appreciate rather than depreciate. For example, mrt build next to it, nearby redevelopment or new development, etc. Location is important especially for LH ones.
1% is arbitrary. I have to put a number. you can put 0.5% or 2%. It is up to you.
As someone else have said, it is probably not linear. It could be bigger as the property gets older.
It's not linear. It escalates after 40yrs.
Frankly SG is so young, no one has really seen his LH properties going to 0 yet. You should watch Arcadia saga. Owners now suddenly wake up it's LH and lease is running out, and now complaining " pty value going down" and want gov to do something.
Which is why I pointed out in another post about what happens when a LH private condo hits 99 years. This has not happened yet so there is no absolute certainty that the land will get reverted back to govt and the people living there gets kicked out. Until that time comes I think many will think there is not to much difference between LH and freehold as observed from the prices.
There LH properties where prices appreciate rather than depreciate. For example, mrt build next to it, nearby redevelopment or new development, etc. Location is important especially for LH ones.
There are other factors that affect pricing.
For calculation I am assuming that the overall market is constant as I can't predict market movement.
But the fact is that 99 yr LH condo does lose its value as the years passes.
On a good year, FH condo will go up 10% but LH condo might go up 9%. This is in general lah.
Common sense right? Would you pay the same amount of money for a condo that only has 70 year lease vs one that has 95 years if everything else is the same, location, unit size, condition? How much discount then is another matter. 10% less? 20% less?
I think only people in dreamland will say LH and FH has no difference.
Unfortunately, in life nothing is perfect and everything is unique. Investor will look for such uniqueness when they invest. This is what one call 'niches'.
There are other factors that affect pricing.
For calculation I am assuming that the overall market is constant as I can't predict market movement.
But the fact is that 99 yr LH condo does lose its value as the years passes.
On a good year, FH condo will go up 10% but LH condo might go up 9%. This is in general lah.
Common sense right? Would you pay the same amount of money for a condo that only has 70 year lease vs one that has 95 years if everything else is the same, location, unit size, condition? How much discount then is another matter. 10% less? 20% less?
I think only people in dreamland will say LH and FH has no difference.
http://www.sla.gov.sg/doc/ser/DP%20policy%20wef%2018%20Jul%202007.pdf
I see a table by the government showing the depreciation of LH compared to FH value
Very interesting. I think I over calculated the LH depreciation. I think it is more in line with 0.4-0.5% on the average assuming your property is 10 years old.
Those should be the best number to use right?
The inflation and recent property prices would have brought some of these prices upwards by 20-30% in the last 5 years. 0.5% is just insignificant.
http://www.sla.gov.sg/doc/ser/DP%20policy%20wef%2018%20Jul%202007.pdf
I see a table by the government showing the depreciation of LH compared to FH value
Very interesting. I think I over calculated the LH depreciation. I think it is more in line with 0.4-0.5% on the average assuming your property is 10 years old.
Those should be the best number to use right?
It's not linear. It escalates after 40yrs.
Frankly SG is so young, no one has really seen his LH properties going to 0 yet. You should watch Arcadia saga. Owners now suddenly wake up it's LH and lease is running out, and now complaining " pty value going down" and want gov to do something.
sh highlighted this useful link before on "The Differential Premium System & Premium for Remnant State Land" :
http://tinyurl.com/6w5kzdu
http://forums.condosingapore.com/showpost.php?p=137155&postcount=41
http://www.sla.gov.sg/doc/ser/DP%20policy%20wef%2018%20Jul%202007.pdf
I see a table by the government showing the depreciation of LH compared to FH value
Very interesting. I think I over calculated the LH depreciation. I think it is more in line with 0.4-0.5% on the average assuming your property is 10 years old.
Those should be the best number to use right?
oops... you already found it while i was searching my database.
Do you know that if you put a downpayment of 40% banks actually don't even need to see your income statement.... They just take it to show that they are prudent.... You actually can get approval right away.. No risk to banks..... Wen have property drop 40%?
Do you know that if you put a downpayment of 40% banks actually don't even need to see your income statement.... They just take it to show that they are prudent.... You actually can get approval right away.. No risk to banks..... Wen have property drop 40%?Yup.. if property prices plummet 40%, banks can close shop liao... Lol! :D
Your "0.3% yield" is wrong! :D
And you can't include depreciation in the calculation because you are depreciating market price of the property? Didn't market price already reflect the current value of the property? You should take capital appreciation instead since property price is supposed to rise equal to inflation, which is about 3% per year average over a long term? In fact, inflation is >5.5% now and the past year! May be we will see a long-term inflation of 4.5% instead for next 10 years and hence you should consider 4.5% appreciation? :scared-1:
After considering what I mentioned above, a person will arrive at a vastly different conclusion than what you have derived based on your calculations! :p
Ok I understand your point.
Then I think our equations are the same what... then why you say I am wrong?
except I simplified by assuming that one uses the freed up capital to pay of other housing loans.
using your method.
Income is around 33k/year ( I noticed i made a calculation error as said 35k previously)
Depreciation for a 99 year property is simplified as 1% per year. 13k/year.
Your interest payment for 800k loan at 1% is around 8k/year.
So net income is 12k per year.So Yield for your 500k "capital" is 2.4%.
So it still does not make sense to sell your house and free up the 500k.
But if interest rates is 1.8%,
your 800k loan interest is 14.4k/year.
And your net income is 5.6k/year and your Yield for the 500k drops to 1.12% which is lower than your 1.8% housing loan interest rate. (there is a delta because I made an error of 2k earlier)
The conclusion is the same.
I think the 1% depreciation I put in for 99 year property has a big effect. But I think we must put something in else how to differentiate FH and LH? FH has much lower rental yield but FH property don't depreciate due to the lease running out.
yes, but the decision to sell should be based on current market price right? Because this is what you will get if you sell now.
Example, if one buys a condo at 1million dollars, 800k loan.
Now it is 1.3million. Should one sell?
I never rent out a condo so I am quite blur at this. But the following is my SIMPLISTIC calculation.
If you can rent the condo out at 3.5k/month= 42k/per year.
10% property tax=4.2k.
condo maintenance fees=$250*12=3k
miscellaneous fees (agent/repair/etc)= 2k??
So you end up with 35k per year, which is around 2.8% yield.
Let's say your loan is at 1.5% interest rate. Should I apply 1.5% to 800k or 1.3million? I think we should apply it to 1.3 million because if you sell the house at 1.3million not 800k. You can make use of the extra 500k. Example, you can pay of the 800k loan + 500k (of your other property loan)
So your yield is only 2.8%-1.5%= 1.3%. If condo is 99years, I would assume it will depreciate normally by 1% per annum (all other things being equal). So you end up with only a 0.3% yield.
A 0.3% yield is rather small to take such a big risk especially if you don't see any upside in the property market from now on. And furthermore if the interest rates rise any higher than 1.5%, it will make it not economical to hold on to the property. People will realise this and start selling....
Is my "theory" correct?
Do you know that if you put a downpayment of 40% banks actually don't even need to see your income statement.... They just take it to show that they are prudent.... You actually can get approval right away.. No risk to banks..... Wen have property drop 40%?
Yesterday UOB said to me put 200k in their bank n no need to submit income document already. You can withdraw the 200k once your loan is approved.
Yesterday UOB said to me put 200k in their bank n no need to submit income document already. You can withdraw the 200k once your loan is approved.
yup i think some banks have this practices, even hsbc. the worse part is, u can even put 200k, then use a person's name with no existing loan AND INCOME (of cse no bad debts) n get a 80% loan... wtf man. After loan approve can take out the 200k
Which is why I pointed out in another post about what happens when a LH private condo hits 99 years. This has not happened yet so there is no absolute certainty that the land will get reverted back to govt and the people living there gets kicked out. Until that time comes I think many will think there is not to much difference between LH and freehold as observed from the prices.
How to own 2 condo in 5 years with $107,000? Both 99 year leasehold.
I pay 20% of $535,000 ($107,000) in Jun 2006 for 2 Bedroom @ Southbank.
In May 2011, I own 2 condo val @ $1,550,000 + $1,305,800 = $2,855,800, with a loan of $1,838,000.
:not-worthy: Interest rate please stay low as long as you like.
We should avoid all 99lh property if we based on above calculation.
Ironically, prices of 99lh property do not depreciate 1% annually.
Depend on when and where you buy. My is $1,000,000 in five years.
How to own 2 condo in 5 years with $107,000?
I pay 20% of $535,000 ($107,000) in Jun 2006 for 2 Bedroom @ Southbank.
In May 2011, I own 2 condo val @ $1,550,000 + $1,305,800 = $2,855,800, with a loan of $1,838,000.
:not-worthy: Interest rate please stay low as long as you like.
Your "0.3% yield" is wrong! :D
And you can't include depreciation in the calculation because you are depreciating market price of the property? Didn't market price already reflect the current value of the property? You should take capital appreciation instead since property price is supposed to rise equal to inflation, which is about 3% per year average over a long term? In fact, inflation is >5.5% now and the past year! May be we will see a long-term inflation of 4.5% instead for next 10 years and hence you should consider 4.5% appreciation? :scared-1:
After considering what I mentioned above, a person will arrive at a vastly different conclusion than what you have derived based on your calculations! :p
I should include the depreciation for LH property as that is what it sets LH aparts. But you are right that I missed out inflation as property prices tend to rise with inflation.
I think inflation is around 2% long term on the average for developed countries. I don't think our inflation will be higher than 5% for extended periods of time... I hope not.
After taking into account that housing will tend to appreciate around 2% average per year along with inflation, then maybe it is not such bad idea to hold and rent out. Interest rates will need to rise higher than 3.5% to make it not worth it to rent.
I am afraid if it is now, not possible to achieve what you achieve anymore! Because now only 60% LTV and not 80% LTV, not to mention all the 4-yrs SSD and ABSD etc! The CMs ensure that if a person is not rich enough, he can't profit from property! They basically ask people to go find other more risky investments to put your money or put in bank (and earn 0.1% interest)! :banghead:
Depend on when and where you buy. My is $1,000,000 in five years.
How to own 2 condo in 5 years with $107,000?
I pay 20% of $535,000 ($107,000) in Jun 2006 for 2 Bedroom @ Southbank.
In May 2011, I own 2 condo val @ $1,550,000 + $1,305,800 = $2,855,800, with a loan of $1,838,000.
:not-worthy: Interest rate please stay low as long as you like.
I am afraid if it is now, not possible to achieve what you achieve anymore! Because now only 60% LTV and not 80% LTV, not to mention all the 4-yrs SSD and ABSD etc! The CMs ensure that if a person is not rich enough, he can't profit from property! They basically ask people to go find other more risky investments to put your money or put in bank (and earn 0.1% interest)! :banghead:
Now is the most important for most people with cash. Hold on to your cash, wait for the next cycle, :not-worthy:pray to the lord to give you wisdom.
Hold on to your cash and you see your cash "depreciating" at >5.5% per annum! (since you put in bank earn negligible interest of 0.1%)! Now is the best time to trade super volatile stock, futures, & forex markets! :D
Think the govt want you all to put money into stock market and unit trusts rather than in property! (since put in bank not a good alternative)! :beats-me-man:
Now is the most important for most people with cash. Hold on to your cash, wait for the next cycle, :not-worthy:pray to the lord to give you wisdom.
Since the LTV now is 60%, does it make sense to settle existing home loan so that you can borrow 80% again or just try to accumulate the 40% for next property.
Since the LTV now is 60%, does it make sense to settle existing home loan so that you can borrow 80% again or just try to accumulate the 40% for next property.
If settle existing loan is less than 20% of the next loan, otherwise better to wait for the next cycle.
edwinleeap
12-02-12, 15:51
Since the LTV now is 60%, does it make sense to settle existing home loan so that you can borrow 80% again or just try to accumulate the 40% for next property.
It depends - on existing loan, current available cash, target property price etc. For many, the HDB loan outstanding is small, so may think of settle existing loan and get 20% downpayment. But that will mean you will find it almost impossible to buy HDB again.
Depend on when and where you buy. My is $1,000,000 in five years.
How to own 2 condo in 5 years with $107,000?
I pay 20% of $535,000 ($107,000) in Jun 2006 for 2 Bedroom @ Southbank.
In May 2011, I own 2 condo val @ $1,550,000 + $1,305,800 = $2,855,800, with a loan of $1,838,000.
:not-worthy: Interest rate please stay low as long as you like.
mm... do you still have Southbank? why is your loan so much? The second condo you took out 1.4mil loan?
mm... do you still have Southbank? why is your loan so much? The second condo you took out 1.4mil loan?
Cash out in Apr 2011. Wanted to cash out in May 2010 during TOP to buy waterbank but bank only allow after CSC. Still waiting for the magic figure 1535000
IMO when market corrects by 20%. may not see. discounts fm developers'sale. mainly fm subsale.
Cash out in Apr 2011. Wanted to cash out in May 2010 during TOP to buy waterbank but bank only allow after CSC. Still waiting for the magic figure 1535000
mmm... if you have just held on to Southbank from 2006 to now, how much profit would you have made? Close to 1mil?
With only 400+k loan.
It seems that the later purchases did not really help much. It is all about the timing. If you entered in 2006... then it is really good.
mmm... if you have just held on to Southbank from 2006 to now, how much profit would you have made? Close to 1mil?
With only 400+k loan.
It seems that the later purchases did not really help much. It is all about the timing. If you entered in 2006... then it is really good.
Brought Southbank because got 5 room HDB. Think of selling 5 room then stay in 2 Bedroom @ Southbank when TOP. March 2007 got chance to go oversea for work bring family along. Rent out 5 Room collect rental. TOP came 5 room rental increase from 1200 to 2400, Southbank val from 535000 to 1550000. Learn a bit on property investment and what is money, decided to take another risk in May 2011 for a 3 Bedroom @ Terrasse. This time think of selling all and stay in Terrasse after TOP.
http://www.youtube.com/watch?v=vVkFb26u9g8
http://en.wikipedia.org/wiki/Robert_Kiyosaki
Brought Southbank because got 5 room HDB. Think of selling 5 room then stay in 2 Bedroom @ Southbank when TOP. March 2007 got chance to go oversea for work bring family along. Rent out 5 Room collect rental. TOP came 5 room rental increase from 1200 to 2400, Southbank val from 535000 to 1550000. Learn a bit on property investment and what is money, decided to take another risk in May 2011 for a 3 Bedroom @ Terrasse. This time think of selling all and stay in Terrasse after TOP.
http://www.youtube.com/watch?v=vVkFb26u9g8
http://en.wikipedia.org/wiki/Robert_Kiyosaki
yup. so most of your profit came mainly from your Soutbank purchase in 2006.
So you have two condos in May 2011. One is bought in May 2011 and the other?
That one should be bought pretty recently too since you have a 1.8million debt.
You must have quite a good view of the property market to put all your profits from the Southbank back into the property market in 2011.
But it does make good sense since the rental from two of your condos is making quite a fair bit for money for you.
yup. so most of your profit came mainly from your Soutbank purchase in 2006.
So you have two condos in May 2011. One is bought in May 2011 and the other?
That one should be bought pretty recently too since you have a 1.8million debt.
You must have quite a good view of the property market to put all your profits from the Southbank back into the property market in 2011.
But it does make good sense since the rental from two of your condos is making quite a fair bit for money for you.
Only one PC got rental the other is HDB, the other PC just pay 20% waiting for the progressive payment. Now holding cash.
You should hve gone in just after lethman crisis. Southbank can fetch gd rental when top. 2 bedder can get abt $4800/mth on high floor.
Brought Southbank because got 5 room HDB. Think of selling 5 room then stay in 2 Bedroom @ Southbank when TOP. March 2007 got chance to go oversea for work bring family along. Rent out 5 Room collect rental. TOP came 5 room rental increase from 1200 to 2400, Southbank val from 535000 to 1550000. Learn a bit on property investment and what is money, decided to take another risk in May 2011 for a 3 Bedroom @ Terrasse. This time think of selling all and stay in Terrasse after TOP.
http://www.youtube.com/watch?v=vVkFb26u9g8
http://en.wikipedia.org/wiki/Robert_Kiyosaki
Only one PC got rental the other is HDB, the other PC just pay 20% waiting for the progressive payment. Now holding cash.
Are you sure you want to slaughter the goose with golden eggs?
You should hve gone in just after lethman crisis. Southbank can fetch gd rental when top. 2 bedder can get abt $4800/mth on high floor.
After reading QE1, QE2, then ECB, now FED going to modify mortgages, all this mean money is just a piece of paper call "IOU". I would rather have a lot of "IOU" then money in the bank.
The Fed chairman said there's no "silver bullet" to rescue the housing market. Renting out foreclosed homes and reducing or modifying mortgages are among steps that could help.
Read more: http://www.foxnews.com/us/2012/02/10/bernanke-weak-housing-has-hurt-consumer-spending/#ixzz1mA5XM4ms
Are you sure you want to slaughter the goose with golden eggs?
Then I can buy more goose with golden egg.
Then I can buy more goose with golden egg.
You muzt know that yvr rental yield will neverbe so good with new properties. Some properties are bought to be kept due to good yield & growth potential.More difficult to findgoose lays golden eggs these days unless there is major correction.
You muzt know that yvr rental yield will neverbe so good with new properties. Some properties are bought to be kept due to good yield & growth potential.
Going back end of the year to sell all except Terrasse and rent. Then go US to buy for investment (US goose). The World is getting smaller due to internet.
http://www.zillow.com/homes/85737_rb/
Going back end of the year to sell all except Terrasse and rent. Then go US to buy for investment (US goose). The World is getting smaller due to internet.
http://www.zillow.com/homes/85737_rb/French goose liver is better. Us will take a long while if it ever recovers. Dragon head is in asia.
Going back end of the year to sell all except Terrasse and rent. Then go US to buy for investment (US goose). The World is getting smaller due to internet.
http://www.zillow.com/homes/85737_rb/ Hve a place near terrasse which i paid 550psf then. Property has really gone up a lot.
French goose liver is better. Us will take a long while if it ever recovers. Dragon head is in asia.
http://www.eface.in/let-us-stop-eating-this-to-mcdonald-kfc-lovers/
French goose liver no good to the goose. Have been looking at French property for investment since Mar 2007, cannot make money.
http://www.seloger.com/recherche.htm?idqfix=1&idtt=2&idtypebien=1,2&cp=33260&ci=&
Hve a place near terrasse which i paid 550psf then. Property has really gone up a lot.
When did u get the place b4 2006?
http://video.foxbusiness.com/v/1445645883001/is-greece-irrelevant-to-global-markets/?playlist_id=87093
Five Bedroom for USD 120,000.
http://www.zillow.com/homes/for_sale/Phoenix-AZ/
Do you guys think I am financially overstretched?
Existing loan : 2 mil
Estimated properties' value : 3.6 mil
Combined gross income : 13k monthly
Rental income : 7 k monthly
Monthly instalment est : 6 k monthly
Cpf used to service instalment : 2 k
Cash used to service instalment : 4 k
Any friendly advice on whether I can hold for the long term? Many thanks first!
Hi
Rental income - monthly installment = $1k / mth cashflow ??
what property that cost 3.6mil but only can rent out 7k ? a rivergate 4 bedder can rent out 8 - 10k
but since we use cpf to service the loan (in ur case is 2k) so your total cashflow is $3k..
Hi
Rental income - monthly installment = $1k / mth cashflow ??
what property that cost 3.6mil but only can rent out 7k ? a rivergate 4 bedder can rent out 8 - 10k
but since we use cpf to service the loan (in ur case is 2k) so your total cashflow is $3k..
If this is his only property a bit risky on rental and property price going the other way. But with 13k income should be able to hold for a while.
Hi
Rental income - monthly installment = $1k / mth cashflow ??
what property that cost 3.6mil but only can rent out 7k ? a rivergate 4 bedder can rent out 8 - 10k
but since we use cpf to service the loan (in ur case is 2k) so your total cashflow is $3k..
maybe one of the property if for own stay?
When did u get the place b4 2006?Was a subsale. Only made 70% of what you would make. Really enjoy the view from such a high floor unit.
maybe one of the property if for own stay?
let's wait for elwin reply
let's wait for elwin reply
He got 2 PC.
He got 2 PC.
shld be CCR condos at that price but i am not impressed with the rental ..
Hi
Rental income - monthly installment = $1k / mth cashflow ??
what property that cost 3.6mil but only can rent out 7k ? a rivergate 4 bedder can rent out 8 - 10k
but since we use cpf to service the loan (in ur case is 2k) so your total cashflow is $3k..It's more than 1 property lah... he wrote 'properties', not 'property'... :sleep:
edwinleeap
13-02-12, 00:26
It's more than 1 property lah... he wrote 'properties', not 'property'... :sleep:
Kam Sia :cheers1:
Kam Sia :cheers1:Bian ke ki (you are welcome)... :cheers5:
Bian ke ki (you are welcome)... :cheers5:
whether it's property or properties, if you look at the rental over the amoount of properties value, it is on the low side. Don't u think ?
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