First property - EC or BTO 5RM?

[CondoSeeker2012]

Hi all,

As a newly married couple purchasing their first property. Which would you go for?

An OCR EC 3RM($1m) or a BTO 5RM($0.5m)?

Property in question:

Citylife@Tampines VS Jan 2013 BTO

The following conditions to consider:
1) Buying to invest, staying with parents
2) Combined income $7k
3) Currently no children, planning to have in 1-2 years
4) No car loan, not planning to buy car
5) No other loan commitments, not planning to have
6) Low interest rates leading into near future
7) Uncertain global outlook
8) OCR Non-landed private property index overtook RCR
9) HDB Resale index comparatively stable, uptrend
10) Larger quantum = More profit
11) Larger quantum = More risk, more interest to pay if rates go north

Pros of EC:
1) Government 30k CPF grant + Deferred Payment Scheme makes it easy to commit to large quantum purchase for first timer
2) Good location of Citylife@Tampines

Pros of BTO 5RM:
1) Largest quantum of BTO series
2) Heavily subsidised sale price represents large differential of >$100k of nearby 5RM comparables means instant paper-profit upon purchase. My capital appreciation calculation of x%P.A. starts from comparable price and not purchase price.


FYI we have e-apped for Citylife, perhaps when pricing is released, the decision would be easier to make. Appreciate advice from great masters here, hope to hear and learn from you please. I am a young member, benefited from this forum but still much more to learn from you.

Thanks!

[ikan bilis]

1) Buying to invest, staying with parents

ummm..... buy private condo lah....

[Emma]

is the downpayment for EC and BTO 20% as well for first property?

[leesg123]

Hi all,

As a newly married couple purchasing their first property. Which would you go for?

An OCR EC 3RM($1m) or a BTO 5RM($0.5m)?


Thanks!

Always start with traditional HDB

[CondoSeeker2012]

ummm..... buy private condo lah....

no money for downpayment

[ikan bilis]

is the downpayment for EC and BTO 20% as well for first property?

EC normally got DPS.... think 5% can liow... but later still got to come out to 20% when TOP... loan max 80%...

[CondoSeeker2012]

is the downpayment for EC and BTO 20% as well for first property?

yes but BTO can be 10% if taking HDB loan

[ikan bilis]

no money for downpayment

be nice and sweet talk to parents, and PIL...

[CondoSeeker2012]

Always start with traditional HDB

Thanks for replying! Can I ask why please?

[Emma]

is the initial cash outlay any different for both ?

[leesg123]

Thanks for replying! Can I ask why please?

lower cash outlay. slowly build up your cash and then after MOP, buy pte.

[CondoSeeker2012]

be nice and sweet talk to parents, and PIL...

Parents will never agree. Want us to stand on own two feet and be down to earth.

Agree with them also, want to do it ourselves. Precious lessons to be learnt will be missed if we take shortcuts I feel. Just my 2 cents, no offence to others who have done so here. Different folks different strokes. =)

[Emma]

what are the main characteristics of HDB Loan? is the interest rate lower ?

yes but BTO can be 10% if taking HDB loan

[jeaprp]

5rm BTO, lower quantum.
can buy another PC later on
when u save enough $$$

[Emma]

what is the initial outlay for traditional HDB?

lower cash outlay. slowly build up your cash and then after MOP, buy pte.

[FamilyGuy72]

Yes with the price gap between EC & PC narrowing, it doesn't really look as attractive as before considering all the restrictions that comes with it.

[phantom_opera]

I would get the best location, does not matter EC or HDB

[Ringo33]

For 1st property, its always good to start with something affordable, affordable in the sense that you could easily afford the monthly mortgage with just CPF and set aside at lease 30% of your cash income as saving..

If you start on the wrong foot, e,g over stretching yourself, it will take a very long time for you to save enough to buy your investment property.

Just remember that your home is not an investment, its a consumption, so the more you consume the less you have for saving.

[alamak]

be nice and sweet talk to parents, and PIL...

Ai Yoh .. You think everyone is a YOWETAN wannabe meh

[Shanhz]

For 1st property, its always good to start with something affordable, affordable in the sense that you could easily afford the monthly mortgage with just CPF and set aside at lease 30% of your cash income as saving..

If you start on the wrong foot, e,g over stretching yourself, it will take a very long time for you to safe enough to buy your investment property.

Just remember that your home is not an investment, its a consumption, so the more you consume the less you have for saving.

this is correct. my view is that the first house must be as cheap as possible. faster save up for 2nd ppty. that was how i planned my strategy 2 years after graduation, and after meeting a senior who was pro at investment.

my suggestion - get a 3 room or max 4 room flat with good location and/or amenities. aim to finish MOP. then get a PC either for stay or investment. in the meantime, pray no CM on MOP.

but you are young. got time on your side. one day you will see the lifting of all the CMs FOR SURE. dunno when. make sure when that happens, you got moola to enter the market.

[buttercarp]

For 1st property, its always good to start with something affordable, affordable in the sense that you could easily afford the monthly mortgage with just CPF and set aside at lease 30% of your cash income as saving..

If you start on the wrong foot, e,g over stretching yourself, it will take a very long time for you to save enough to buy your investment property.

Just remember that your home is not an investment, its a consumption, so the more you consume the less you have for saving.

Yup agree with Ringo!

I would go for the BTO.
Combined monthly $7k - to buy a 1mil home is over- stretching unless you got someone to pay for your deposit.

[ctng78]

BTO ... Goverment gift ma. I want also cannot.

[Tripp]

Isn't it risky for a young couple earning 7K combined per mth getting a $1M EC?

[proud owner]

go for the BTO..


once you go straight into EC or PC ... you lose the ONLY thing that you ever get from this govt thats subsidized

[bsslang]

Go for bto with a good location. Pay the premium is fine.

1m ec will eat away at least 1k of your income per month for loan interest based on current interest rate. Imagine if current interest rate is doubled or triple within the 8 years you have to hold e ec, e amount will be 2k n 3k per month.

[Rosy]

There are quite a few bto in non-punggol area. Worth taking a look.

Even 2nd timers manage to get a unit at bendemeer light.

[Trigger]

I would go for EC. Citylife looks great, you enjoy full condo facilities and still get the grant. Value will usually go up after 5 or 10 years when it becomes privatised. I don't know what your job is, but normally your salary should also rise in 4 years time when you have to pay the full P+I for the whole loan quantum.

[henryhk]

wat for go for 1 mil EC....be realistic....after marriage and wen kids come along, u will face the stress, and if ur wife stops work to look after them, ur life will be v tough......Last time EC is half price....now is ridiculous price....buy a hdb and accumulate ur wealth for future purchase

[Laguna]

If u can get a very good unit for the BTO, then go for it.

I think location shall carry more weight.

The other consideration, be it BTO or EC, the mortagage payment will kick in much later, and your earning capacity is also bigger.

[azeoprop]

You should have applied for Nov's BTO Compassvale mast next to Sengkang mrt. Jan's 2013 BTO location all not really that good.

http://www101.hdb.gov.sg/hdbvsf/eampu11p.nsf/0/12NOVBTOSK_page_8931/$file/12NOVBTOSK_map.htm

http://www.hdb.gov.sg/fi10/fi10321p....r?OpenDocument