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Thread: Looking for advise, opinions in property investment

  1. #1
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    Default Looking for advise, opinions in property investment

    Hi forumers,

    I am 38. Married with a 3 yr old.

    Lately business has not that good and I am starting to have self doubts.

    I feel very insecure and frustrated as there are strings of unsuccessful business attempts.

    I am quite a conservative person. So no big bets.

    No special or expensive hobbies. No big holidays. Drive a jap car. No maid.

    I have been at this form since 2010. Read many great articles and you guys are just great with numbers and insights.

    I am looking for advise and opinions on
    1) Commercial 60 yrs vs freehold
    2) Condo 99 yrs vs freehold
    3) HDB

    I guess the bottomline is should I in the long term convert to freehold properties?

    Thanks in advance.

  2. #2
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    I am sorry...but if your intent is to purchase property during time of personal instability. Probably u shouldn't. Just keep doing what u do now and preserve cash. Just remember when situation turn around quickly buy property with renting to tenant in mind.

  3. #3
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    Freehold with no tenant is worse than 60 years leasehold full of tenants

  4. #4
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    Quote Originally Posted by DayDreamer View Post
    Hi forumers,

    I am 38. Married with a 3 yr old.

    Lately business has not that good and I am starting to have self doubts.

    I feel very insecure and frustrated as there are strings of unsuccessful business attempts.

    I am quite a conservative person. So no big bets.

    No special or expensive hobbies. No big holidays. Drive a jap car. No maid.

    I have been at this form since 2010. Read many great articles and you guys are just great with numbers and insights.

    I am looking for advise and opinions on
    1) Commercial 60 yrs vs freehold
    2) Condo 99 yrs vs freehold
    3) HDB

    I guess the bottomline is should I in the long term convert to freehold properties?

    Thanks in advance.
    I prefer freehold, unless it's hdb. Then no choice 99yrs leasehold.

    Anything below 60yrs lease can't get the max usage for cpf, and loan tenure

  5. #5
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    Job unstable definitely HDB
    The three laws of Kelonguni:

    Where there is kelong, there is guni.
    No kelong no guni.
    More kelong = more guni.

  6. #6
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    Hmmm... since 2010 you were in this forum, and married with 3 yrs old kid with no hdb yet.?

    Even getting a hdb in yr 2010, it's also profiting now

  7. #7
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    Quote Originally Posted by DayDreamer View Post
    Hi forumers,

    I am 38. Married with a 3 yr old.

    Lately business has not that good and I am starting to have self doubts.

    I feel very insecure and frustrated as there are strings of unsuccessful business attempts.

    I am quite a conservative person. So no big bets.

    No special or expensive hobbies. No big holidays. Drive a jap car. No maid.

    I have been at this form since 2010. Read many great articles and you guys are just great with numbers and insights.

    I am looking for advise and opinions on
    1) Commercial 60 yrs vs freehold
    2) Condo 99 yrs vs freehold
    3) HDB

    I guess the bottomline is should I in the long term convert to freehold properties?

    Thanks in advance.
    First what do you have.

    Next your wife

  8. #8
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    if unstable cashflow, go for BTO.

  9. #9
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    Default

    Thanks for writing back.

    After reading about the Geylang Lorong 3 article, it makes me kind of worried. That is why I want to seek advise and opinion, whether in the long run to sell the lease hold and buy into freehold.

    1) HDB - On loan. (Plan to stay for another 7 yrs. Once my son gets into the school and stays till P3, sell off. Buy another HDB, stay for 5 yrs, sell off. Buy EC, stay 5 yrs, sell off. Buy Condo.
    I will be 55. From this exercise, I should be able to accumulate 600-800k to pay for condo. Not sure feasible or realistic.

    2) Condo 1(FH) - Fully paid. Own use.

    3) Condo 2(99) - On loan. Tenanted.

    4) Condo 3(FH) (Malaysia) - Fully paid. Tenanted.

    5) Commercial 1(60) - Fully paid. Tenanted.

    6) Commercial 2(60) - On loan. Own use and partially tenanted.

    7) Commercial 3(99) (Malaysia) - Fully paid. Abandon.

    8) Wife is working. But is thinking to go back school. Only child. Parents have a HDB. Fully paid. I guess it will go to her.

  10. #10
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    Quote Originally Posted by DayDreamer View Post
    Thanks for writing back.

    After reading about the Geylang Lorong 3 article, it makes me kind of worried. That is why I want to seek advise and opinion, whether in the long run to sell the lease hold and buy into freehold.

    1) HDB - On loan. (Plan to stay for another 7 yrs. Once my son gets into the school and stays till P3, sell off. Buy another HDB, stay for 5 yrs, sell off. Buy EC, stay 5 yrs, sell off. Buy Condo.
    I will be 55. From this exercise, I should be able to accumulate 600-800k to pay for condo. Not sure feasible or realistic.

    2) Condo 1(FH) - Fully paid. Own use.

    3) Condo 2(99) - On loan. Tenanted.

    4) Condo 3(FH) (Malaysia) - Fully paid. Tenanted.

    5) Commercial 1(60) - Fully paid. Tenanted.

    6) Commercial 2(60) - On loan. Own use and partially tenanted.

    7) Commercial 3(99) (Malaysia) - Fully paid. Abandon.

    8) Wife is working. But is thinking to go back school. Only child. Parents have a HDB. Fully paid. I guess it will go to her.
    You are doing well as you are. Singaporeans like to proclaim poor when they are millionaires.

  11. #11
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    Quote Originally Posted by DayDreamer View Post
    Thanks for writing back.

    After reading about the Geylang Lorong 3 article, it makes me kind of worried. That is why I want to seek advise and opinion, whether in the long run to sell the lease hold and buy into freehold.

    1) HDB - On loan. (Plan to stay for another 7 yrs. Once my son gets into the school and stays till P3, sell off. Buy another HDB, stay for 5 yrs, sell off. Buy EC, stay 5 yrs, sell off. Buy Condo.
    I will be 55. From this exercise, I should be able to accumulate 600-800k to pay for condo. Not sure feasible or realistic.

    2) Condo 1(FH) - Fully paid. Own use.

    3) Condo 2(99) - On loan. Tenanted.

    4) Condo 3(FH) (Malaysia) - Fully paid. Tenanted.

    5) Commercial 1(60) - Fully paid. Tenanted.

    6) Commercial 2(60) - On loan. Own use and partially tenanted.

    7) Commercial 3(99) (Malaysia) - Fully paid. Abandon.

    8) Wife is working. But is thinking to go back school. Only child. Parents have a HDB. Fully paid. I guess it will go to her.
    For your 1) plan. To sell off after 7 years and buy another hdb and sell off again to buy EC.

    Issue is u sell off hdb, how do you buy back hdb when u owe condos..? And how you apply for EC when u owe condos.??

  12. #12
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    Arcachon will ask you how many 10 years you have.

    Next time 800k not definitely can upgrade to good sized condo. Maybe MM condo?
    The three laws of Kelonguni:

    Where there is kelong, there is guni.
    No kelong no guni.
    More kelong = more guni.

  13. #13
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    Quote Originally Posted by jwong71 View Post
    For your 1) plan. To sell off after 7 years and buy another hdb and sell off again to buy EC.

    Issue is u sell off hdb, how do you buy back hdb when u owe condos..? And how you apply for EC when u owe condos.??
    Are those his portfolios (looks damn impressive for a 38 yr old who obviously lacks knowledge of current housing rules )?? Or Daydreaming ah!

  14. #14
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    Quote Originally Posted by jwong71 View Post
    For your 1) plan. To sell off after 7 years and buy another hdb and sell off again to buy EC.

    Issue is u sell off hdb, how do you buy back hdb when u owe condos..? And how you apply for EC when u owe condos.??
    In the near future, I consider to sell both condos. Condo 1 getting old about 20 yrs old and Condo 2 about 10 yrs in 7 yrs time.
    If not, I can move them into my company. But have to pay additional tax. Don't think it is worth it. However, an opportunity to buy FH.
    Anyone here have experience buying condo under company?

  15. #15
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    Quote Originally Posted by DayDreamer View Post
    In the near future, I consider to sell both condos. Condo 1 getting old about 20 yrs old and Condo 2 about 10 yrs in 7 yrs time.
    If not, I can move them into my company. But have to pay additional tax. Don't think it is worth it. However, an opportunity to buy FH.
    Anyone here have experience buying condo under company?
    You move the residential properties into a company, company is subject to ABSD and stamp duties with the transfer. Plus you will have a hard time convincing IRAS that the properties are not held by the company for trading purposes, and hence any revenue gains should not be subject to tax, once held under a company.

    Anyway I may be sprouting nonsense. For such matters, go talk to IRAS or a formal tax advisor.
    Last edited by new2mondrian; 14-08-17 at 19:16.

  16. #16
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    Quote Originally Posted by DayDreamer View Post
    Hi forumers,

    I am 38. Married with a 3 yr old.

    Lately business has not that good and I am starting to have self doubts.

    I feel very insecure and frustrated as there are strings of unsuccessful business attempts.

    I am quite a conservative person. So no big bets.

    No special or expensive hobbies. No big holidays. Drive a jap car. No maid.

    I have been at this form since 2010. Read many great articles and you guys are just great with numbers and insights.

    I am looking for advise and opinions on
    1) Commercial 60 yrs vs freehold
    2) Condo 99 yrs vs freehold
    3) HDB

    I guess the bottomline is should I in the long term convert to freehold properties?

    Thanks in advance.
    Any equity loans or business loans taken against any of these properties, including the paid up ones?

    Cash flow is critical when it comes to sustaining a business. Strange that you are looking at LH to FH property conversion (which mean fresh round of stamp duties, agent/conveyancing charges) and more cash tied up with properties (fresh purchases are subject to TDSR) rather than reinvesting into the business.

    However, if you have spare cash, yes by all means do so. But your question is very broad. Leasehold properties (non-landed) can be subject to rejuvenation through the en-bloc process, and the yield can be more attractive than FH, depending on location. It all boils down to whether you can find an attractively priced replacement at current prices. Otherwise you are just making the taxman, agents, lawyers and bankers happy.

  17. #17
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    Quote Originally Posted by DayDreamer View Post
    Thanks for writing back.

    After reading about the Geylang Lorong 3 article, it makes me kind of worried. That is why I want to seek advise and opinion, whether in the long run to sell the lease hold and buy into freehold.

    1) HDB - On loan. (Plan to stay for another 7 yrs. Once my son gets into the school and stays till P3, sell off. Buy another HDB, stay for 5 yrs, sell off. Buy EC, stay 5 yrs, sell off. Buy Condo.
    I will be 55. From this exercise, I should be able to accumulate 600-800k to pay for condo. Not sure feasible or realistic.

    2) Condo 1(FH) - Fully paid. Own use.

    3) Condo 2(99) - On loan. Tenanted.

    4) Condo 3(FH) (Malaysia) - Fully paid. Tenanted.

    5) Commercial 1(60) - Fully paid. Tenanted.

    6) Commercial 2(60) - On loan. Own use and partially tenanted.

    7) Commercial 3(99) (Malaysia) - Fully paid. Abandon.

    8) Wife is working. But is thinking to go back school. Only child. Parents have a HDB. Fully paid. I guess it will go to her.
    how are you planning to do (1) when you have so many property? You can't buy HDB again once you let go your current one, unless rules change.

  18. #18
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    My Guess - he will be decoupling from his Wife...

  19. #19
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    Quote Originally Posted by indomie View Post
    You are doing well as you are. Singaporeans like to proclaim poor when they are millionaires.
    Not really. Business in the red for the last 3 yrs. Cut cost and hoping for a turn around. I am a Malaysian PR.

  20. #20
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    Noted on all points. I have only property loans.

    The thought of leasehold ending has always bother me. Yes, I know I won't live forever but all the hard work and sacrifices put in is an opportunity cost.

    You guys are right, plan 1 is not that easy to execute. I will stay put for now.






    Quote Originally Posted by new2mondrian View Post
    Any equity loans or business loans taken against any of these properties, including the paid up ones?

    Cash flow is critical when it comes to sustaining a business. Strange that you are looking at LH to FH property conversion (which mean fresh round of stamp duties, agent/conveyancing charges) and more cash tied up with properties (fresh purchases are subject to TDSR) rather than reinvesting into the business.

    However, if you have spare cash, yes by all means do so. But your question is very broad. Leasehold properties (non-landed) can be subject to rejuvenation through the en-bloc process, and the yield can be more attractive than FH, depending on location. It all boils down to whether you can find an attractively priced replacement at current prices. Otherwise you are just making the taxman, agents, lawyers and bankers happy.

  21. #21
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    Anyone with old FH commercial experience? Is it worth paying the extra premium? Commercial 1 is left with 40 yrs. If I don't sell in the next 10 yrs, I will probably have to hold onto it till the end. I think price will decline once it pass the 30 yr mark.

    I was thinking that once I pay off about 80% of Commercial 2, to look into replacement options for Commercial 1. Maybe a new 60 yrs LH is better than FH. One FH can probably buy two 60 yrs LH. Any thoughts?

  22. #22
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    Quote Originally Posted by DayDreamer View Post
    Thanks for writing back.

    After reading about the Geylang Lorong 3 article, it makes me kind of worried. That is why I want to seek advise and opinion, whether in the long run to sell the lease hold and buy into freehold.

    1) HDB - On loan. (Plan to stay for another 7 yrs. Once my son gets into the school and stays till P3, sell off. Buy another HDB, stay for 5 yrs, sell off. Buy EC, stay 5 yrs, sell off. Buy Condo.
    I will be 55. From this exercise, I should be able to accumulate 600-800k to pay for condo. Not sure feasible or realistic.

    2) Condo 1(FH) - Fully paid. Own use.

    3) Condo 2(99) - On loan. Tenanted.

    4) Condo 3(FH) (Malaysia) - Fully paid. Tenanted.

    5) Commercial 1(60) - Fully paid. Tenanted.

    6) Commercial 2(60) - On loan. Own use and partially tenanted.

    7) Commercial 3(99) (Malaysia) - Fully paid. Abandon.

    8) Wife is working. But is thinking to go back school. Only child. Parents have a HDB. Fully paid. I guess it will go to her.
    Only one word, Cash flow.

  23. #23
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    Depends on what your goals are. I would say that generally LH gives better rental yield. But if you are buying for longer term capital gain then I would recommend FH. Having said that, I have made better gains with some of my LH vs FH because I bought them cheap. Also my current highest performing unit is a FH commercial because I bought it during a time of ' distress' 2008. You would need to consider your Budget and what is available in that price range as well as your holding power. Remember you make when you buy, so entry point is important. Last.y buy what you know and understand and are comfortable with. Apart from Residential and Commercial there is also Industrial B1 & 2. As for HDB , it's more for own stay but a unit in the right location can years down the road give you a leg up if you want to upgrade.
    To answer your last question, if buying LH I tend to go for newer developments. As the lease runs down price tends to not move as much unless there is en bloc potential.

  24. #24
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    Quote Originally Posted by DayDreamer View Post
    Anyone with old FH commercial experience? Is it worth paying the extra premium? Commercial 1 is left with 40 yrs. If I don't sell in the next 10 yrs, I will probably have to hold onto it till the end. I think price will decline once it pass the 30 yr mark.

    I was thinking that once I pay off about 80% of Commercial 2, to look into replacement options for Commercial 1. Maybe a new 60 yrs LH is better than FH. One FH can probably buy two 60 yrs LH. Any thoughts?
    Personally I am not optimistic about commercial properties (industrial ones even worse, cos there's always JTC as a master landlord to put a damper on any upside in yield). Business models have changed. The premise of having a brick and mortar locale for conducting a business no longer holds. Over time, people may not even have to venture out of their homes to buy goods, to work, or to obtain a service. IoT will make such brick and mortar based businesses uncompetitive with time.

  25. #25
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    Points noted. You mentioned LH has en bloc potential but it would not happen to all right?
    So, do you reckon there a cut off point (yrs) where the value decline as the lease gets closer to expiring. What is the course of action?

    Quote Originally Posted by Tulip09 View Post
    Depends on what your goals are. I would say that generally LH gives better rental yield. But if you are buying for longer term capital gain then I would recommend FH. Having said that, I have made better gains with some of my LH vs FH because I bought them cheap. Also my current highest performing unit is a FH commercial because I bought it during a time of ' distress' 2008. You would need to consider your Budget and what is available in that price range as well as your holding power. Remember you make when you buy, so entry point is important. Last.y buy what you know and understand and are comfortable with. Apart from Residential and Commercial there is also Industrial B1 & 2. As for HDB , it's more for own stay but a unit in the right location can years down the road give you a leg up if you want to upgrade.
    To answer your last question, if buying LH I tend to go for newer developments. As the lease runs down price tends to not move as much unless there is en bloc potential.

  26. #26
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    Like Tulip09, my highest performing unit is in commercial. But you have a point there. People are more mobile and connected and working from wherever they are at.
    But I think there is still a need for space. I have a friend doing online baby products and every few years, he is looking for bigger space for his inventory.

    Quote Originally Posted by new2mondrian View Post
    Personally I am not optimistic about commercial properties (industrial ones even worse, cos there's always JTC as a master landlord to put a damper on any upside in yield). Business models have changed. The premise of having a brick and mortar locale for conducting a business no longer holds. Over time, people may not even have to venture out of their homes to buy goods, to work, or to obtain a service. IoT will make such brick and mortar based businesses uncompetitive with time.

  27. #27
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    Quote Originally Posted by DayDreamer View Post
    Not really. Business in the red for the last 3 yrs. Cut cost and hoping for a turn around. I am a Malaysian PR.
    You and me are already awaken by the reality of business. Profit margin is so thin. Operating cost escalating. Competitions are vicious. This period of structural transition from traditional economy to online economy you can't avoid. Its the reason why I invest in property.

  28. #28
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    Ya, I guess the same reason too. Main business is not growing but shrinking.
    But it is from my father's friends who made me realised that they invested in properties and are making a killing at their old age. They made money in their business but it is their properties that made the most. All happily retired. However, that period is over.

    I am not sure if my approach is correct. I have never sold any properties in sg. So when I read that people in the forum are making a killing by flipping, I am quite envious. My risk appetite is very small.
    Once I pay off enough of the loan, then I will look into properties.


    Quote Originally Posted by indomie View Post
    You and me are already awaken by the reality of business. Profit margin is so thin. Operating cost escalating. Competitions are vicious. This period of structural transition from traditional economy to online economy you can't avoid. Its the reason why I invest in property.

  29. #29
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    Quote Originally Posted by DayDreamer View Post
    Ya, I guess the same reason too. Main business is not growing but shrinking.
    But it is from my father's friends who made me realised that they invested in properties and are making a killing at their old age. They made money in their business but it is their properties that made the most. All happily retired. However, that period is over.

    I am not sure if my approach is correct. I have never sold any properties in sg. So when I read that people in the forum are making a killing by flipping, I am quite envious. My risk appetite is very small.
    Once I pay off enough of the loan, then I will look into properties.
    I can't see the point of keeping the main business. There is no more ups and downs cycle. Its flat line now. Any fat profit margin left is quickly deflated by competitors. What is left are clients relying on credit line. But I am grateful that I am awaken to this situation early.

  30. #30
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    Now even I give 60-90 days credit to my customers, they also need to consider. It is that bad.

    Quote Originally Posted by indomie View Post
    I can't see the point of keeping the main business. There is no more ups and downs cycle. Its flat line now. Any fat profit margin left is quickly deflated by competitors. What is left are clients relying on credit line. But I am grateful that I am awaken to this situation early.

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