Ho Lian-Yi

Tue, Nov 11, 2008

The New Paper

How to buy a house

(This column will make use of many abbreviations without explanation. It is the author's opinion that if you don't know what CPF or O$P$ means, you have no business buying a house in Singapore.)

IF you are a young couple, you might be looking for a place of your own.

But you may not know how to begin.

As someone who just got his own home, let me help you.

Since most of us aren't filthy rich, we will be looking for an HDB flat, which is subsidised. That means it will take you only one lifetime to pay it off, not several.

If you are not over 35, the first thing you have to do is get married.

Often this begins with a proposal.

This can be very complicated, if you (the guy) decide to take the romantic route.

I don't recommend this.

You can also do it the simple way, which is how I did it, and how thousands of happily married Singaporeans did it.

First, turn to her and say: "Let's buy HDB together."

Girls love surprises, so you want to do it where she least expects it, such as in a hawker centre.

She might say, as my own wife did: "Was that a proposal?"

Look her in the eye now if you haven't already and reply, loudly: "Yes!"

You can start the ROM application, right after she stops crying.

Now you're on the way to being married, it's time to check your CPF account.

Since you can't use the funds there right now, it's not really money, is it?

The next step is to work out what your budget is and compare it with how much the flat you want costs.

At this point, resist the urge to flee to some place with cheaper homes, like Malaysia or Europe.

Now, you can apply for a new flat, a built-to-order (BTO) flat, or a resale flat.

There are pros and cons for all of them.

A. New flat

Pros: Cheap. Fast to get.

Cons: Much depends on your getting a good number in the lucky draw. Hundreds of flats, thousands of applicants, all desperate like you and willing to kill.


Pros: Relatively cheap.

Cons: Takes a lot of time. You may have to live with your family for many more years until your "dream home" is built.

C. Resale

Pros: Fast. Versatile.

Cons: Expensive. Crazy people.

Decided? Now, apply for a loan.

Next, lie in bed all weekend wondering when you'll ever pay it off. Make plans to flee to Malaysia/Europe.

Personally, I did resale, because (A) required luck I didn't have and I'd rather deal with crazy people (C) than live with them (B).

You need to understand that some home-sellers and housing agents are insane and/or money-grubbing weasels.

On the phone: "We are looking at $300,000."

When you meet: "We are looking at $350,000."

When you do agree: "Sure, let's sign on Monday."

On Monday: "Oh, I can't sign right now. Uh... My mother, the co-owner, left the country. Yesterday."

As for how to pick the right home, it really depends on each individual.

The rule of thumb is, if someone spraypainted the address with O$P$, or the neighbour is a strange old man who looks oddly like Gary Glitter - avoid.

Also, ensure your home is not within walking distance of your in-laws, for the same reason as O$P$.

Once the sale is agreed upon, you will have a cooling-off period of one week before you need to sign anything else. Then there is the first meeting, the loan approval and so on.

It can be depressing, with the realisation that until you pay off your debt, the bank/HDB owns you.

But perk up! Because you are now a homeowner! Congratulations!

This article was first published in The New Paper on November 9, 2008.