View Full Version : Wat would u do?
Hi to all gurus,
As per title, like to seek opinions from experts ... Been thinking wat should I do for my next phase in life.
About myself.. Married, no kids , dual income ~ $16k . Savings ~ 150k. Currently owns 2 apts - 1) fully paid apt 99 yr . 2) also 99 yr apt w loan of 700k, tenanted .
Would like to purchase another apt so that we can rent out n perhaps my wife can work part time n be a landlord . But reading another post by forumer, that it's almost impossible unless we r so cash rich, but then again do we want to plonk all our savings of 500k or more to get another place? That 's if we even managed to save that much in the first place.
Been staying in my current place for almost 10 yrs. condo is almost 20 yrs old in suburbs. Been wanting to change to a newer place, a freehold apt, preferably sea-facing :)- n that would mean selling current place, solely under my name.
The 2nd apt is co-owned. Which means I hav to pay ABSD if I sell n buy again.
Another way is to sell both, buy one freehold for own stay n wait to buy another one for investment.
Wat would u do? I'm in my 30s . I guess this will be one of the major decisions that i ll be making... Maybe affecting whether we can retire comfortably later in life.
Rgds
any plans to have kids? if yes, better stay put and be contented.
Hi to all gurus,
As per title, like to seek opinions from experts ... Been thinking wat should I do for my next phase in life.
About myself.. Married, no kids , dual income ~ $16k . Savings ~ 150k. Currently owns 2 apts - 1) fully paid apt 99 yr . 2) also 99 yr apt w loan of 700k, tenanted .
Would like to purchase another apt so that we can rent out n perhaps my wife can work part time n be a landlord . But reading another post by forumer, that it's almost impossible unless we r so cash rich, but then again do we want to plonk all our savings of 500k or more to get another place? That 's if we even managed to save that much in the first place.
Been staying in my current place for almost 10 yrs. condo is almost 20 yrs old in suburbs. Been wanting to change to a newer place, a freehold apt, preferably sea-facing :)- n that would mean selling current place, solely under my name.
The 2nd apt is co-owned. Which means I hav to pay ABSD if I sell n buy again.
Another way is to sell both, buy one freehold for own stay n wait to buy another one for investment.
Wat would u do? I'm in my 30s . I guess this will be one of the major decisions that i ll be making... Maybe affecting whether we can retire comfortably later in life.
Rgds
Regulators
27-06-13, 02:12
Save more cash or buy a pty in Malaysia if u have to buy.
Having a kid will be the be choice.
Allthepies
27-06-13, 07:27
is your tenanted property in few hundred K of profit? if yes, will you consider selling now? and hold for correction before going in again? while waiting for the crash, which is a very boring process, consider having a kid? ; )
Your wife's biological clock is ticking away. Better to have a kid now. I regret not having them earlier (my first in mid-thirties).
Hi to all gurus,
As per title, like to seek opinions from experts ... Been thinking wat should I do for my next phase in life.
About myself.. Married, no kids , dual income ~ $16k . Savings ~ 150k. Currently owns 2 apts - 1) fully paid apt 99 yr . 2) also 99 yr apt w loan of 700k, tenanted .
Would like to purchase another apt so that we can rent out n perhaps my wife can work part time n be a landlord . But reading another post by forumer, that it's almost impossible unless we r so cash rich, but then again do we want to plonk all our savings of 500k or more to get another place? That 's if we even managed to save that much in the first place.
Been staying in my current place for almost 10 yrs. condo is almost 20 yrs old in suburbs. Been wanting to change to a newer place, a freehold apt, preferably sea-facing :)- n that would mean selling current place, solely under my name.
The 2nd apt is co-owned. Which means I hav to pay ABSD if I sell n buy again.
Another way is to sell both, buy one freehold for own stay n wait to buy another one for investment.
Wat would u do? I'm in my 30s . I guess this will be one of the major decisions that i ll be making... Maybe affecting whether we can retire comfortably later in life.
Rgds
decouple your property and use your saving to buy a 1 bedder a J gateway with progressive payment. 3 years later, sell and use the profit as down payment for a seaview unit.
Save more cash or buy a pty in Malaysia if u have to buy.
Want freehold & sea facing?
Buy Senibong Cove waterfront bungalow.. land 6000sf / build-up 5000sf.. S$1.5-mil
Right in front of your balcony is the sea:D
TheOnlyGayInTheVillage
27-06-13, 08:54
Your single income can sustain the 700k loan. Mortgage per mth probably 1.8k ish right.
Explore equity loan on your fully paid property. However since the new target will be your third property, max loan is 40%. If you only have 150k you cant even afford a 500k shoebox. Havent even talk about 10% absd...
phantom_opera
27-06-13, 08:55
consider retirement in 5y.. be a volunteer .. life is not just about money :p
consider retirement in 5y.. be a volunteer .. life is not just about money :p
Thumbs up... :cheers4: , :D
Your single income can sustain the 700k loan. Mortgage per mth probably 1.8k ish right.
Explore equity loan on your fully paid property. However since the new target will be your third property, max loan is 40%. If you only have 150k you cant even afford a 500k shoebox. Havent even talk about 10% absd...
Very typical of middle class dilemma - money cannot be invested safely but gets eaten away by inflation. I think having a kid should be top priority, because property cannot look after you or keep you company when you are old. But then please don't transfer your properties to the kid before you go into another world.
Kids won't keep u company when they grow up. They rather go out with their own friends or boyfriend or girlfriend.
Nowadays youngster won't look after the sick or old. They likely to send the old or sick to nursing home. Sad but true. Money is quite important do not trust all your money to your kids.
Ai yo, kids and property investment are not mutually exclusive. Can plan for both.
depends on what you want out of life... got to sit down and map out your choices. since you asked, then prob aim is to maximise your returns.
ideal is to sell your current old condo first unless there's chance of enbloc.
more practical will be in stages (to avoid absd):
sell the newer joint ownership condo (then you should have at least 500k seed money to buy up to 2.5mil), then buy another condo under your wife's name (if there is sufficient trust in your relationship), decide carefully whether for own stay (bigger unit) or for investment (smaller one). after that swap out your current older condo. correlate your move according to your reading of the market.
otherwise buy into overseas eg malaysia project - depending again on own stay or investment - lots of other considerations here through.
with 2 properties you are already savvy and in better position than many others. may not be a bad idea either to wait for minor corrections in 1 to 2 years to enter again. however absd may not be removed anytime soon and you still got to go through the earlier circuit, so why not sooner if you identify a good unit with good location.
cheers !
Regulators
27-06-13, 11:55
And have pirates anchor in front of the house
Want freehold & sea facing?
Buy Senibong Cove waterfront bungalow.. land 6000sf / build-up 5000sf.. S$1.5-mil
Right in front of your balcony is the sea:D
Would like to purchase another apt so that we can rent out n perhaps my wife can work part time n be a landlord
Another way is to sell both, buy one freehold for own stay n wait to buy another one for investment.
Wat would u do?
You're talking about wife working part-time in future, so either a kid is on the way or you are making plans to have a child.
The house you are living in is your sole name, which means you bought it when you were single and in your twenties. You said that "Been wanting to change to a newer place, a freehold apt, preferably sea-facing" If that is the case, then I don't think you are happy living in your present home or could it be that your present home is not suitable for a family?
If I were in your shoes, I would not even think of a third property. I would look for a home that you would both be happy living in and it's comfortable enough for a growing family. Look for an environment that is conducive to raising a child like near childcare centres, sporting facilities, reasonably good primary schools and enrichment centres. Even if you do not plan to have children, there will always be a pool of buyers for your home.
Meanwhile, enjoy your new home and be happy. Be patient and wait for an opportunity to buy your second home. Property market is cyclical and there will always be an opportunity to buy an investment property. A good time to buy is when they remove the cooling measures.
Hope this helps as I am not you and you are not me.:D
Kids won't keep u company when they grow up. They rather go out with their own friends or boyfriend or girlfriend.
Nowadays youngster won't look after the sick or old. They likely to send the old or sick to nursing home. Sad but true. Money is quite important do not trust all your money to your kids.
Ya.. Sad but true..
Be prepared to look after ourselves (between you & your partner) when one day we are old.. especially when your kids are grown up & have their own partner
Ya.. Sad but true..
Be prepared to look after ourselves (between you & your partner) when one day we are old.. especially when your kids are grown up & have their own partner
That's true. If you receive any allowance from children, please thank God.
And have pirates anchor in front of the house
Hopefully those waterfront houses in Sentosa will be safe from the indo pirates too.. cos those are the super rich one.. their landed is 10-mil.. 50-mil (not those 1.5 mil)
Here is the deal. Because of your situation, having 3 properties will definitely incur ABSD. You can consider selling your tenanted apartment and liquidate whatever cash there is. Get a seaview FH for your own stay and maybe incurring mortgage loan of about $1mil under just your wife's name. Do ensure that your new apartment can fit in any kids that might come along. Then comfortably rent out your fully paid 20 year old apartment...
Like most other forumers, I'd encourage you to start your family planning before you regret or its too late...
Your single income can sustain the 700k loan. Mortgage per mth probably 1.8k ish right.
Explore equity loan on your fully paid property. However since the new target will be your third property, max loan is 40%. If you only have 150k you cant even afford a 500k shoebox. Havent even talk about 10% absd...
Equity loan needs to take out CPF portion as well so actual amount that can be offered may not be significant after all.
Good Day everyone,
And thank you for all the replies! I feel it's always good to hear opinions from guys who have been there and done that...
To those who encourage us to have a child, sorry to disappoint but we do not intend to have children. I suppose my wife and I will be lonely in our twilight years... but i guess it's a decision we have made and will live by it.
We have always been v conservative in our investments. When we got our 2nd apt, we chose a 3yr fixed, and for 20 yrs. Only recently, we started investing in shares as the ABSD has made it much harder for us to own a 3rd.
Still, at the back of my mind, we would eventually like to own a third. And thus this posting.
Enjoy ur evening guys !
Good Day everyone,
And thank you for all the replies! I feel it's always good to hear opinions from guys who have been there and done that...
To those who encourage us to have a child, sorry to disappoint but we do not intend to have children. I suppose my wife and I will be lonely in our twilight years... but i guess it's a decision we have made and will live by it.
We have always been v conservative in our investments. When we got our 2nd apt, we chose a 3yr fixed, and for 20 yrs. Only recently, we started investing in shares as the ABSD has made it much harder for us to own a 3rd.
Still, at the back of my mind, we would eventually like to own a third. And thus this posting.
Enjoy ur evening guys !
30something means another at least 40 years to go so early retirement with little or no passive income is a huge liability esp. in singapore. You have such a good head start, 2 pte apt with 700k liability. Then tenancy will help you to pay all up in 20 years I believe. With $150k liquidity to weather storm and good double income, I would sit back and wait for the next opportunity to come if looking at residential. Meanwhile, take good care of your health with balanced lifestyle, the true wealth lies here. Else we'll spend our lifetime chasing all the $ and then using all the $ to get back our health - adaptation from the Dalai Lama.
30something means another at least 40 years to go so early retirement with little or no passive income is a huge liability esp. in singapore. You have such a good head start, 2 pte apt with 700k liability. Then tenancy will help you to pay all up in 20 years I believe. With $150k liquidity to weather storm and good double income, I would sit back and wait for the next opportunity to come if looking at residential. Meanwhile, take good care of your health with balanced lifestyle, the true wealth lies here. Else we'll spend our lifetime chasing all the $ and then using all the $ to get back our health - adaptation from the Dalai Lama.
I would sit back and wait for the next opportunity to come if looking at residential. :cool-punk-headbange I cannot agree more.
Good Day everyone,
And thank you for all the replies! I feel it's always good to hear opinions from guys who have been there and done that...
To those who encourage us to have a child, sorry to disappoint but we do not intend to have children. I suppose my wife and I will be lonely in our twilight years... but i guess it's a decision we have made and will live by it.
We have always been v conservative in our investments. When we got our 2nd apt, we chose a 3yr fixed, and for 20 yrs. Only recently, we started investing in shares as the ABSD has made it much harder for us to own a 3rd.
Still, at the back of my mind, we would eventually like to own a third. And thus this posting.
Enjoy ur evening guys !Well good to learn about your portfolio and decisions. If you are into shares, it might be difficult to come out quickly if property market dips coz property lags financial market. During down times, when you are hoping to recoup losses from shares, property market opportunities may well strike. As such, insufficient ammunition. Just remember that.
Going forward, if you are really keen on a 3rd property, then start looking and highlighting favorable locations. There might be fire sales on and off. Just have your ammunition ready to strike! However, if you are not prepared to keep on watching the property market for such rare fire sales, then just wait for the interest rates to go up (has been talked about for the longest time though) or any other significant events before scouting. All the best! :cheers6:
Many of us will only dream to be in your financial position which is excellent. It shows that it really pays to start early in property investment, and you have already paid up one property, yet you are only in your 30s.
You are in an excellent position to buy another property in the future. I would suggest that you hold on to all that you own at the moment, since you obviously acquired it at a much better deal. Selling and buying now will only inquire ABSD and having to keep it for 4years means that with 3 properties, it could be a stretch.
I would take a wait and see approach. You have nothing to lose, as you'e already secured two properties. My belief is that most property investors are now are either first timers or those that want a second unit for investment. I don't think many will look for their third unit in this climate with ABSD and SSD.
Once the market eases, jump in for that FH property. If it doesn't ease, you still don't lose out, you already have 2 properties anyways and you would have likely saved more for better options in the near future.
Congrats on your success...Perhaps you could even share with us how you managed this so well, being only in your 30s:)
Office Boy is Back !
I get such questions in the office day after day.
There is only one answer.
Stay Put. Do nothing.
Have to tell you the hard truths.
1) Your $150K is NOTHING. This is spare money for u to cushion in the event you (and wife) lose job. Or if u decide to tell your Boss to Go To Hell one day and walk out. You wont know the value of this option until when you need this option.
2) You are unable to take anymore property risks. If you decide to take out additional loans like what TOGV says, then you must be prepared to stay employed and get income for at least 15 more years.
3) Not much choices left in the market for significant upside. The name of the game now is thin margins, churn volume. This means ppl now are willing to take $100K net profit and go for a $1.2 mil condo. These are experienced and loaded investors, hard to beat them.
4) Know what you want to do with your life. Like what Phantom says, its NOT all about money. Once u know what you want to do with your life, the rest (about property portfolio management) will be very easy.
Hope your humble Office Boy contributed to your decision.
DKSG
Well good to learn about your portfolio and decisions. If you are into shares, it might be difficult to come out quickly if property market dips coz property lags financial market. During down times, when you are hoping to recoup losses from shares, property market opportunities may well strike. As such, insufficient ammunition. Just remember that.
Going forward, if you are really keen on a 3rd property, then start looking and highlighting favorable locations. There might be fire sales on and off. Just have your ammunition ready to strike! However, if you are not prepared to keep on watching the property market for such rare fire sales, then just wait for the interest rates to go up (has been talked about for the longest time though) or any other significant events before scouting. All the best! :cheers6:Just to add on... interest rates to rise soon but who knows when... according to Barclays...
Amidst 60% price growth.
According to Barclays, they believe Singapore property prices could be vulnerable to a sharp rate increase after three years of super-low interest rates and 60% price growth.
Barclays' current base case is flat private home prices to FY16E, but they estimate these could fall up to 23% should mortgage rates increase by 200bps within a short period, all things remaining constant.
http://sg.finance.yahoo.com/news/why-singapore-property-prices-vulnerable-081100229.html
What would Barclays agenda be commenting on real estate? I dont think i recall them having a toe in this business.
Obviously they would prefer HNWI letting them manage their millions than to plonk into properties.
Hopefully those waterfront houses in Sentosa will be safe from the indo pirates too.. cos those are the super rich one.. their landed is 10-mil.. 50-mil (not those 1.5 mil)
Senibong Cove is not facing open sea...the straits should be safe from pirates lah.....Sentosa faces open sea....hmmmm......anyway average joe in Sg are already priced out of sea facing FH condos right? Even those around Sentosa are LH...but cost an arm and leg....
What about this scenario
My wife and myself early 30s. Household income > $ 20k pm. One baby, planning for next. $500k cash. No inheritance
Own D20 3bdr condo jointly owned bought few years back with 80 % loan, due to price appreciation now it's 50% LTV. No good schools nearby. No SSD
Option 1 : practice decoupling and pay $30k transaction cost for transferring 50%. Restart with 4 year SSD clock. Buy another 2br CCR for renting out. Own separately
Option 2: sell current place, buy 3br CCR condo near good schools for stay and future appreciation. Buy another OCR 2bdr near mrt for renting out. Own separately
Option 3: do nothing, save up more and buy landed for self stay (ultimate singaporean dream) post price moderation (hopefully) few years down the road post CM removed. Then Rent out current place
Option 4: downgrade to huge hdb near good schools. While Waiting for MOP, dump cash into blue chip stocks and bonds.
What about this scenario
My wife and myself early 30s. Household income > $ 20k pm. One baby, planning for next. $500k cash. No inheritance
Own D20 3bdr condo jointly owned bought few years back with 80 % loan, due to price appreciation now it's 50% LTV. No good schools nearby. No SSD
Option 1 : practice decoupling and pay $30k transaction cost for transferring 50%. Restart with 4 year SSD clock. Buy another 2br CCR for renting out. Own separately
Option 2: sell current place, buy 3br CCR condo near good schools for stay and future appreciation. Buy another OCR 2bdr near mrt for renting out. Own separately
Option 3: do nothing, save up more and buy landed for self stay (ultimate singaporean dream) post price moderation (hopefully) few years down the road post CM removed. Then Rent out current place
Option 4: downgrade to huge hdb near good schools. While Waiting for MOP, dump cash into blue chip stocks and bonds.
Since you are planning for 2nd baby, option 2 seems to make most sense.
Why not set up a poll and get people to vote.
condoviewer
01-07-13, 11:31
What about this scenario
Option 3: do nothing, save up more and buy landed for self stay (ultimate singaporean dream) post price moderation (hopefully) few years down the road post CM removed. Then Rent out current place
Option 4: downgrade to huge hdb near good schools. While Waiting for MOP, dump cash into blue chip stocks and bonds.
Take option 3.
i am surprised that a lot of high earners are asking for advice on what to do.
housing income $16k pm, $20k pm need advice meh?
the thing i find out from all these people is that high pay is not correlated to wisdom level or even intelligence level. (to use D&D terms).
darkseed73
01-07-13, 14:57
i am surprised that a lot of high earners are asking for advice on what to do.
housing income $16k pm, $20k pm need advice meh?
the thing i find out from all these people is that high pay is not correlated to wisdom level or even intelligence level. (to use D&D terms).
Ppl whom earn high salary usually are in the little own "comfort" zone.
They see and hear others making money yet they only earn a "fix" rate thus hoping by coming to forum they get that courage to do the "Leap of faith".
It has nothing to do with wisdom or intelligence, more of "guts".
Usually these are followers afraid to be left out.
My advice to these ppl is "No pain, no gain, no guts, no glory"
There is no perfect plan, there is only guts and survival instinct.
i am surprised that a lot of high earners are asking for advice on what to do.
housing income $16k pm, $20k pm need advice meh?
the thing i find out from all these people is that high pay is not correlated to wisdom level or even intelligence level. (to use D&D terms).
That's a very sweeping statement but I do confess that even though I have the wisdom to make money from employment income, I do not have the experience of property investment unlike all the old birds here, and hence am humbly asking for advice.
I am after all only in my early 30s :)
That's a very sweeping statement but I do confess that even though I have the wisdom to make money from employment income, I do not have the experience of property investment unlike all the old birds here, and hence am humbly asking for advice.
I am after all only in my early 30s :)
Old birds are not necessarily wise birds. This is what i did, and it was not the best way to maximize returns, but at least we have a good night's sleep.
Bought our first condo and paid off the loan in 5 years. Had children there and was debt free. Spend all our time and money in our business and nurturing the young children. They were sent to all kinds of enrichment classes and activities.
When the youngest was still in kindergarten, we upgraded to a landed, which is my present house. We sold our condo and topped up the balance with our savings. We didn't take any housing loans and had to start saving like crazy again for our investment properties.
We are not money smart as our rental properties have no bank interests to offset. Our money didn't work for us and it's left sleeping in the current and savings accounts.
If there is another opportunity like in 2009, then the idle cash would come in handy.
Why do I choose this path? Guess I am a product of my upbringing. Parents conditioned me from young:
1) Money don't grow on trees you know
2) Live within your means
3) Buy only when you can afford
My father died young and didn't live long enough to see the QE and low interest rate environment. Ha ha, wonder what he would have taught me if he had seen this scenario.
i earned less than average median which is 4k plus.
And i didn't complaint much because i have a choice not to drive and stay in luxurious condo or bungalow.
Property investment is a great equalizer. People who don't have a lot of cash and low earning can have a good opportunity to own valuable assets if they get in early.
People who have a lot of cash and high earning are usually "sleeping". They are not interested in property in under developed area, which happened to have a lot of growth potential.
In the end a slow turtle will over took a quick hare.
i earned less than average median which is 4k plus.
And i didn't complaint much because i have a choice not to drive and stay in luxurious condo or bungalow.
Hi Lovelle, how are u????
U are champion..... car is a liability..... and I am a sucker... Hahahahahaha
when u own a property and it is paid by the tenant over 30 years, it becomes "free" - cost to you is at deposit amount.... at the same time, you can returns from it till one kicks the bucket !!!!! Again, the individual has a choice to convert if he/she wants to...
:cheers4::cheers4::cheers4:
Property investment is a great equalizer. People who don't have a lot of cash and low earning can have a good opportunity to own valuable assets if they get in early.
People who have a lot of cash and high earning are usually "sleeping". They are not interested in property in under developed area, which happened to have a lot of growth potential.
In the end a slow turtle will over took a quick hare.
Your statement is absolutely true...
Go in 2006, the value doubled....
Say 1mil prop in 2006 is now worth 2 mil. Down 200k, make 1 mil (excluding rental amount)
Go in 2009, the value increased 50%
Say 1mil prop in 2009, now worth 1.5 mil.
Go in 2011, the value increase about 20%
Say 1 mil prop in 2011, now worth 1.2 mil.
The difference is, in 2009, downpayment only 20%. In 2011, downpayment is 50%.....
Entry barrier keeps going higher and higher... limiting the number of players... with all CMs, growth is curtailed..... But it is good for overall market lah....
Those who bot early are laughing.... :cheers4::cheers4::cheers4:
Hi Lovelle, how are u????
U are champion..... car is a liability..... and I am a sucker... Hahahahahaha
when u own a property and it is paid by the tenant over 30 years, it becomes "free" - cost to you is at deposit amount.... at the same time, you can returns from it till one kicks the bucket !!!!! Again, the individual has a choice to convert if he/she wants to...
:cheers4::cheers4::cheers4:
hello bro chestnut
times are bad, hahaha... i am idling now....
Your statement is absolutely true...
Go in 2006, the value doubled....
Say 1mil prop in 2006 is now worth 2 mil. Down 200k, make 1 mil (excluding rental amount)
Go in 2009, the value increased 50%
Say 1mil prop in 2009, now worth 1.5 mil.
Go in 2011, the value increase about 20%
Say 1 mil prop in 2011, now worth 1.2 mil.
Looks familiar, since early 2012 decide to hold all, not sell and not buy more becos its higher entry barrier. Status quo, TOP/collect rental... cheers.
hello bro chestnut
times are bad, hahaha... i am idling now....
Need some break leh.... Hahahaha
U did well.... :cheers4: :cheers4: :cheers4:
Looks familiar, since early 2012 decide to hold all, not sell and not buy more becos its higher entry barrier. Status quo, TOP/collect rental... cheers.
Bro, with all this cm, all the investors since the start of cm are stronger leh.... With the introduction of the later CMs where u need to down 40% or more and SSD of 4 years, those investors are really long term.... I also kanna a few props with the above leh.... Hahahahahaha
Steady lah... Just collect rental lor....:cheers4:
Having a kid will be the be choice.
yup if no plan for kids no point having so many properties:D
What about this scenario
My wife and myself early 30s. Household income > $ 20k pm. One baby, planning for next. $500k cash. No inheritance
Own D20 3bdr condo jointly owned bought few years back with 80 % loan, due to price appreciation now it's 50% LTV. No good schools nearby. No SSD
Option 1 : practice decoupling and pay $30k transaction cost for transferring 50%. Restart with 4 year SSD clock. Buy another 2br CCR for renting out. Own separately
Option 2: sell current place, buy 3br CCR condo near good schools for stay and future appreciation. Buy another OCR 2bdr near mrt for renting out. Own separately
Option 3: do nothing, save up more and buy landed for self stay (ultimate singaporean dream) post price moderation (hopefully) few years down the road post CM removed. Then Rent out current place
Option 4: downgrade to huge hdb near good schools. While Waiting for MOP, dump cash into blue chip stocks and bonds.W $500K cash, please don't let it rot. Option 2 appears feasible but with a tweak. You go to CCR only coz of good sch or for the prestige? Well, my 2 cents worth is this. Going forward, interest rates will surely go up soon. Getting a CCR 3 bedder will most certainly increase your financial burden. With more kids, I suggest you decide which school you hope to send them and go for a property w/in 1km. It need not be in CCR. There are many good schools in OCR too. Take less loan not because you cannot afford the monthly mortgage but because no point paying so much interest to the bank UNLESS you have another investment option which brings in more than 5% returns on a regular basis at >80% probability to make sense to take up a larger mortgage loan. Also, please do not enter the volatile stock market w/o doing your homework.
Having said that, if you guys are the greedy type, then go for option 5. Keep your current D20 condo as investment property. Get another 3 bedder at a place near your preferred school to send your child/children to. Dump in the $500k as 40% downpayment along with the necessary ABSD. Use the rental from the 1st property to service as much of your mortgage loans and then top it up with a little bit more from own pocket. In the end, you pay less than if you stay on with the current property but in return, you have another property sitting on potential price appreciation. Also, you will certainly qualify for loan base on your current financial situation. Your choice.
W $500K cash, please don't let it rot. Option 2 appears feasible but with a tweak. You go to CCR only coz of good sch or for the prestige? Well, my 2 cents worth is this. Going forward, interest rates will surely go up soon. Getting a CCR 3 bedder will most certainly increase your financial burden. With more kids, I suggest you decide which school you hope to send them and go for a property w/in 1km. It need not be in CCR. There are many good schools in OCR too. Take less loan not because you cannot afford the monthly mortgage but because no point paying so much interest to the bank UNLESS you have another investment option which brings in more than 5% returns on a regular basis at >80% probability to make sense to take up a larger mortgage loan. Also, please do not enter the volatile stock market w/o doing your homework.
Having said that, if you guys are the greedy type, then go for option 5. Keep your current D20 condo as investment property. Get another 3 bedder at a place near your preferred school to send your child/children to. Dump in the $500k as 40% downpayment along with the necessary ABSD. Use the rental from the 1st property to service as much of your mortgage loans and then top it up with a little bit more from own pocket. In the end, you pay less than if you stay on with the current property but in return, you have another property sitting on potential price appreciation. Also, you will certainly qualify for loan base on your current financial situation. Your choice.
Good advice thanks
Why not get a larger loan if possible since interest rates are still low? I rather put in fixed deposit for the time being and have the flexibility of cash. If interest rate spike up, I always have the choice of partial repayment of loan. It's easy to repay the bank but hard to draw a loan, cash is king.
Yea my cash is rotting in the bank but right now the increasing interest rates has already caused bonds, gold prices to come down.... And people have cautioned against buying at property at peak prices but I notice that certain regions eg CCR have more value than OCR, my humble opinion
Old birds are not necessarily wise birds. This is what i did, and it was not the best way to maximize returns, but at least we have a good night's sleep.
Bought our first condo and paid off the loan in 5 years. Had children there and was debt free. Spend all our time and money in our business and nurturing the young children. They were sent to all kinds of enrichment classes and activities.
When the youngest was still in kindergarten, we upgraded to a landed, which is my present house. We sold our condo and topped up the balance with our savings. We didn't take any housing loans and had to start saving like crazy again for our investment properties.
We are not money smart as our rental properties have no bank interests to offset. Our money didn't work for us and it's left sleeping in the current and savings accounts.
If there is another opportunity like in 2009, then the idle cash would come in handy.
Why do I choose this path? Guess I am a product of my upbringing. Parents conditioned me from young:
1) Money don't grow on trees you know
2) Live within your means
3) Buy only when you can afford
My father died young and didn't live long enough to see the QE and low interest rate environment. Ha ha, wonder what he would have taught me if he had seen this scenario.
Conservative but prudent approach
As you have correctly highlighted, I am ( and sure many others in this forum as well) are waiting for crisis so that there is a buying opportunity
Good advice thanks
Why not get a larger loan if possible since interest rates are still low? I rather put in fixed deposit for the time being and have the flexibility of cash. If interest rate spike up, I always have the choice of partial repayment of loan. It's easy to repay the bank but hard to draw a loan, cash is king.
Well if your fixed D interest is higher than the mortgage loan interest, then you are still fine. If not, then you are waiting for interest rates to spike before doing partial repayment, why not just do it at the beginning? Anyway, all the best!
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