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Thread: Renting landed is better than buying?

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    Default Renting landed is better than buying?

    Was doing some comparison on the rental rate vs selling price of landed property in Singapore. What I discover is that rental rate for landed property have remain stagnant or in come case decline for sometime while resale prices has shot up drastically over the past few years.

    A quick search on propertyguru does show that there are plenty of landed properties in Singapore which is asking about $1 to $2psf in rental, which is about (50%) of what a condo in similar location will be asking.

    Hence would it make more sense to actually buy a condo rent it out and then use the rental to rent a landed property (IF) you need that extra space?

    e.g. for a 1500sqft condo, you can actually upsize to a 3000sqft landed without having to cough out anything extra other than higher property tax.

    Advantage
    a) Dont have to be over burden by huge mortgage and fear rising interest
    b) Dont have to pay for repair and maintenance of landed property,
    c) Plenty of landed property owner desperate for tenant
    d) Can upsize and downsize without worries?

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    Quote Originally Posted by Ringo33
    Was doing some comparison on the rental rate vs selling price of landed property in Singapore. What I discover is that rental rate for landed property have remain stagnant or in come case decline for sometime while resale prices has shot up drastically over the past few years.

    A quick search on propertyguru does show that there are plenty of landed properties in Singapore which is asking about $1 to $2psf in rental, which is about (50%) of what a condo in similar location will be asking.

    Hence would it make more sense to actually buy a condo rent it out and then use the rental to rent a landed property (IF) you need that extra space?

    e.g. for a 1500sqft condo, you can actually upsize to a 3000sqft landed without having to cough out anything extra other than higher property tax.

    Advantage
    a) Dont have to be over burden by huge mortgage and fear rising interest
    b) Dont have to pay for repair and maintenance of landed property,
    c) Plenty of landed property owner desperate for tenant
    d) Can upsize and downsize without worries?
    Quite true indeed! Landed rental is cheap.

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    Quote Originally Posted by Ringo33
    Was doing some comparison on the rental rate vs selling price of landed property in Singapore. What I discover is that rental rate for landed property have remain stagnant or in come case decline for sometime while resale prices has shot up drastically over the past few years.

    A quick search on propertyguru does show that there are plenty of landed properties in Singapore which is asking about $1 to $2psf in rental, which is about (50%) of what a condo in similar location will be asking.

    Hence would it make more sense to actually buy a condo rent it out and then use the rental to rent a landed property (IF) you need that extra space?

    e.g. for a 1500sqft condo, you can actually upsize to a 3000sqft landed without having to cough out anything extra other than higher property tax.

    Advantage
    a) Dont have to be over burden by huge mortgage and fear rising interest
    b) Dont have to pay for repair and maintenance of landed property,
    c) Plenty of landed property owner desperate for tenant
    d) Can upsize and downsize without worries?
    Finally you get round to it. Two MM rental gains can more than sustain one landed rental cost. Can even afford to be choosy about it - get the newest and the best located one.

    Overall cost wise, two MMs don't quite cost as much as a landed.

    The only minus point is that if you meet tricky landlords, might have to move quite frequently.

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    Quote Originally Posted by Ringo33
    Was doing some comparison on the rental rate vs selling price of landed property in Singapore. What I discover is that rental rate for landed property have remain stagnant or in come case decline for sometime while resale prices has shot up drastically over the past few years.

    A quick search on propertyguru does show that there are plenty of landed properties in Singapore which is asking about $1 to $2psf in rental, which is about (50%) of what a condo in similar location will be asking.

    Hence would it make more sense to actually buy a condo rent it out and then use the rental to rent a landed property (IF) you need that extra space?

    e.g. for a 1500sqft condo, you can actually upsize to a 3000sqft landed without having to cough out anything extra other than higher property tax.

    Advantage
    a) Dont have to be over burden by huge mortgage and fear rising interest
    b) Dont have to pay for repair and maintenance of landed property,
    c) Plenty of landed property owner desperate for tenant
    d) Can upsize and downsize without worries?
    Actually, if you think about it, instead of 1 unit 1500 sqf condo, you can go for 3x 500 sqf Studio....or if you feel safer (in terms of catchment), 2x 800 sqf 2-bedder. Just have to put up with being a normad and no anchor or home to call your own.

    Having said that, a friend of mine rented out her 35 yr old Inter-terrace for the last 30 yrs. Half of the time to 1 family in the last 15 years!

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    Quote Originally Posted by Ringo33
    c) Plenty of landed property owner desperate for tenant
    Quote Originally Posted by Jaykj
    Having said that, a friend of mine rented out her 35 yr old Inter-terrace for the last 30 yrs. Half of the time to 1 family in the last 15 years!
    Landed houses that are rented out are probably older houses that were bought cheaply by owners.
    I don't think landed property owners are desperate for tenants as majority of them would have owned more than one landed. In fact it's cheaper to leave a landed than a condo empty, as there's no monthly maintenance fees to pay.
    I know of someone who bought a few semi-detached at less than S$20,000 each 40 years ago and is still renting them now at $4,000 each a month!

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    Quote Originally Posted by moneytalk
    Landed houses that are rented out are probably older houses that were bought cheaply by owners.
    I don't think landed property owners are desperate for tenants as majority of them would have owned more than one landed. In fact it's cheaper to leave a landed than a condo empty, as there's no monthly maintenance fees to pay.
    I know of someone who bought a few semi-detached at less than S$20,000 each 40 years ago and is still renting them now at $4,000 each a month!
    Yes, I know quite a few landed owners who have a take it or leave it attitude when it comes to renting out their property. They have no qualms about leaving it empty as the rental is of no consequence to them. As you have pointed out correctly, they do not pay any maintenance and are just holding it for their kids when they grow up (lucky kids !!!).

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    The main advantage of owning landed is to do whatever you want to the house... renovate or rebuild. Can't do that to a rental.

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    Quote Originally Posted by moneytalk
    Landed houses that are rented out are probably older houses that were bought cheaply by owners.
    I don't think landed property owners are desperate for tenants as majority of them would have owned more than one landed. In fact it's cheaper to leave a landed than a condo empty, as there's no monthly maintenance fees to pay.
    I know of someone who bought a few semi-detached at less than S$20,000 each 40 years ago and is still renting them now at $4,000 each a month!
    I think we shouldnt speculate that all landed property owner are so loaded that they can leave their property vacant, nor they are not desperate for tenant. Honestly if they are not desperate, then why bother to rent out at such low price.

    Although landed property doesnt have month maintenance fee, but they do have major repair cost which can run into many thousands once every few years, so not everything is free unless you own land.

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    I would not want my landed property to be left empty for long period of time. Best to have "human Qi"/ Yang Qi. Maybe i a little pang tang.

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    Quote Originally Posted by sh
    The main advantage of owning landed is to do whatever you want to the house... renovate or rebuild. Can't do that to a rental.
    The main advantage of renting is you are not limited to what you own, you can pick and choose what you like as long as its within the budget.

    If you can buy fresh milk from supermarket, why waste time keeping a cow.

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    this is a very smart move
    I am rich in debts...

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    Do not have such major repair cost. My last repair was 13 years ago.
    Quote Originally Posted by Ringo33
    I think we shouldnt speculate that all landed property owner are so loaded that they can leave their property vacant, nor they are not desperate for tenant. Honestly if they are not desperate, then why bother to rent out at such low price.

    Although landed property doesnt have month maintenance fee, but they do have major repair cost which can run into many thousands once every few years, so not everything is free unless you own land.

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    For landed properties in prime districts, near international schools or classified as Good Class Bungalows, rental demand is high and prices are more stable.

    For terrace houses outside central region, most people buy for their own occupation.

    The landed estate where I am staying I notice that houses are seldom for rent. In 2006, the rental is only $1,800 to $2,000. Now it is between $4,500 to $5,000. But hardly can you find any house for rent. After the owner moves out, he just leaves the house vacant, regardless of whether it is for sale or not.

    Once you pay off the mortgage, the holding cost of a landed property is very negligible, with no maintenance fee and low property tax. Owners are thus not motivated to rent out the house. They also don't want the hassle of helping tenants with all the repairs in the house.

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    Quote Originally Posted by moneytalk
    Landed houses that are rented out are probably older houses that were bought cheaply by owners.
    I don't think landed property owners are desperate for tenants as majority of them would have owned more than one landed. In fact it's cheaper to leave a landed than a condo empty, as there's no monthly maintenance fees to pay.
    I know of someone who bought a few semi-detached at less than S$20,000 each 40 years ago and is still renting them now at $4,000 each a month!
    I know of someone in similar situation.. he owns an entire row of terraces and rent them out at about 4K each ... the terraces are so old already but ang moh likes them as they need the space.

    I see my entire neighbourhood that over the past decade, several big units have already been sold, torn down and either converted to cluster houses or chopped into smaller land pieces of 'tiny bungalows'

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    Quote Originally Posted by vip
    Once you pay off the mortgage, the holding cost of a landed property is very negligible, with no maintenance fee and low property tax. Owners are thus not motivated to rent out the house. They also don't want the hassle of helping tenants with all the repairs in the house.
    Yes, agree... its a misconception that it is costly to maintain a landed ppty, unless its for own stay where you need regular maintenance, otherwise the holding cost for an empty unit is rather low...

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    Quote Originally Posted by vip
    Once you pay off the mortgage, the holding cost of a landed property is very negligible, with no maintenance fee and low property tax. Owners are thus not motivated to rent out the house. They also don't want the hassle of helping tenants with all the repairs in the house.
    Precisely, my tenant's friends wanted to stay near her so my tenant took the trouble to locate the owner of the vacant house. My tenant asked the owner to do a bit of minor repairs and rent out the house to her friends.
    The owner refused and my tenant couldn't understand why the owner would rather leave the house vacant than collect a few thousand dollars rental a month.

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    Quote Originally Posted by moneytalk
    Precisely, my tenant's friends wanted to stay near her so my tenant took the trouble to locate the owner of the vacant house. My tenant asked the owner to do a bit of minor repairs and rent out the house to her friends.
    The owner refused and my tenant couldn't understand why the owner would rather leave the house vacant than collect a few thousand dollars rental a month.
    My cousin has 3 landed properties ... the oldest one was occupied by her MIL, the second one (which she used to stay with her family) was left empty after her family moved to the third one (newly constructed). She doesnt want to rent out the second unit becos she does not wish to see her house got ruined by tenants. Her intention is to pass down a house to each of her 3 sons after they got married.

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    Quote Originally Posted by vip
    For landed properties in prime districts, near international schools or classified as Good Class Bungalows, rental demand is high and prices are more stable.

    For terrace houses outside central region, most people buy for their own occupation.

    The landed estate where I am staying I notice that houses are seldom for rent. In 2006, the rental is only $1,800 to $2,000. Now it is between $4,500 to $5,000. But hardly can you find any house for rent. After the owner moves out, he just leaves the house vacant, regardless of whether it is for sale or not.

    Once you pay off the mortgage, the holding cost of a landed property is very negligible, with no maintenance fee and low property tax. Owners are thus not motivated to rent out the house. They also don't want the hassle of helping tenants with all the repairs in the house.

    There are plenty for rent on property website and st classified.

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    Buying a condo with 3 to 4 bedrooms need to pay monthly maintenance of $400 to $500. That's $4,800 to $6,000 a year and $48,000 to $60,000 in 10 years. When you sell the place, the management office won't give you any refund even though they keep millions in their reserve.

    That's why we bought a leasehold terrace house with 5 bedrooms (even though we only had 3 in the family at that time). The maintenance fee we saved we hire a maid to 'maintain both inside and outside of the house'. The balance can be used for any repair.

    Now you understand why people buy landed for own stay rather than for rental.
    Last edited by vip; 15-02-13 at 14:23.

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    http://www.propertyguru.com.sg/listi...-thomson-hills

    $5900 per month before nego??



    http://www.propertyguru.com.sg/listi...sunset-heights

    6100sqft detached house $7000 per month


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    $8000 per month - 4,650 sqft / 432 sqm (land), 3,000 sqft / 279 sqm (built-up) Coronation Road West
    http://www.propertyguru.com.sg/listi...tion-road-west



    $8000 per month - 2,600 sqft / 242 sqm (land), 2,900 sqft / 269 sqm (built-up) Jervois Road
    http://www.propertyguru.com.sg/listi...t-jervois-road

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    Quote Originally Posted by Ringo33
    The main advantage of renting is you are not limited to what you own, you can pick and choose what you like as long as its within the budget.

    If you can buy fresh milk from supermarket, why waste time keeping a cow.
    I think the main problem is with such a big space it is hard to move often. If you need such a big space, you probably have many stuff...

    Small condo easier to change as packing up easy...

    That is the main reason why landed rental is cheaper because there is just not much demand. The rental units usually are also very old.

    If you rent, you can only get old almost expired milk from the shelves. If you buy, you can have hand made milk shakes tailored to your own liking (renovation).

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    One of my friends rent a landed property for past 10 years. His rental still remains $800 per month and never increase. Landlord owned a few landed properties and what he wants is no problem from his tenant.

    Where to find this type of landlord?
    When is the right time to buy my next property?

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    Quote Originally Posted by FREDDIE
    One of my friends rent a landed property for past 10 years. His rental still remains $800 per month and never increase. Landlord owned a few landed properties and what he wants is no problem from his tenant.

    Where to find this type of landlord?
    Renting a room or whole unit?

    All I can say is, landed buyers are a different kind of person.

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    Wow so cheap?
    (Think they are haunted??? )


    Quote Originally Posted by Ringo33
    http://www.propertyguru.com.sg/listi...-thomson-hills

    $5900 per month before nego??



    http://www.propertyguru.com.sg/listi...sunset-heights

    6100sqft detached house $7000 per month


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    Quote Originally Posted by Kelonguni
    Renting a room or whole unit?

    All I can say is, landed buyers are a different kind of person.
    Yes, they have very different thinking. I know of quite a few landed owners who buy a 2nd or even 3rd landed property not for the rental yield but as a legacy to pass onto their kids. When I ask them why, they say that landed is the best. When their kids grow up, they can do it up any way they please and the good thing is that he and his wife can stay with any one of them because there is enough space. They certainly don't buy it for the rental yields. In fact for nice houses, they would rather stay it in themselves or leave it vacant because they are scared that the tenants would ruin them.

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    Yah loh, rental so poor, rather leave it vacant than rent out, otherwise end up have to repair here repair there for tenants and yet collect peanuts and pay 10% property tax instead of 4%! You see so many advertised is because to claim back the difference in property tax they need to show they try to rent out but no takers mah...

    Quote Originally Posted by equalizer
    Yes, they have very different thinking. I know of quite a few landed owners who buy a 2nd or even 3rd landed property not for the rental yield but as a legacy to pass onto their kids. When I ask them why, they say that landed is the best. When their kids grow up, they can do it up any way they please and the good thing is that he and his wife can stay with any one of them because there is enough space. They certainly don't buy it for the rental yields. In fact for nice houses, they would rather stay it in themselves or leave it vacant because they are scared that the tenants would ruin them.

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    Quote Originally Posted by Ringo33
    There are plenty for rent on property website and st classified.
    Those houses you quoted are usually NOT meant for locals, but rent out to expatriates with handsome housing packages, e.g. the family of a CEO or MD in a multinational corporation's regional headquarters in Singapore. Owners are looking for company lease only

    I am surprised that these agents put an asking price there. The practice is to leave it blank or have an indicative range there. So when the HR person or agent representing the company call, the owner's agent will ask, "What's the company's budget?" And the maximum housing budget of the expatriate will be the asking rent.

    If you work in an MNC, or you yourself (or you know someone) who rent/lease these houses, you'll know exactly what I mean

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    Quote Originally Posted by vip
    Those houses you quoted are usually NOT meant for locals, but rent out to expatriates with handsome housing packages, e.g. the family of a CEO or MD in a multinational corporation's regional headquarters in Singapore. Owners are looking for company lease only

    I am surprised that these agents put an asking price there. The practice is to leave it blank or have an indicative range there. So when the HR person or agent representing the company call, the owner's agent will ask, "What's the company's budget?" And the maximum housing budget of the expatriate will be the asking rent.

    If you work in an MNC, or you yourself (or you know someone) who rent/lease these houses, you'll know exactly what I mean
    Actually you are wrong, those I quoted are actually within the budget of Singaporeans who are living in condo. Example, if you are living a 3 or 4 bedder condo in prime district, you could easily rent it out for 5 to 6K and that should be sufficient to rent yourself a landed property that it as least twice the size.

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    Quote Originally Posted by FREDDIE
    One of my friends rent a landed property for past 10 years. His rental still remains $800 per month and never increase. Landlord owned a few landed properties and what he wants is no problem from his tenant.

    Where to find this type of landlord?
    in situation like this, who do you thing get the better end of the bargain?

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