7% is too high, dun scare urself... if 7% everyone will be parking $$ in fixed deposits, no one will borrow and the economy will truly collapseOriginally Posted by ocoloco79
i think 4% is better gauge ~
Junior
7% is too high, dun scare urself... if 7% everyone will be parking $$ in fixed deposits, no one will borrow and the economy will truly collapse
i think 4% is better gauge ~
Newbie
there is a ruling on cap on CPF funds usable for properties with less than 60 years of remaining lease, which makes your HDB flat less attractive as it approaches the 30 plus years mark; unless the location of the flat is compelling or the flat has a million-dollar view.new2mondrian,
my hdb is not 22yrs, it is 26yrs now, and 29yrs by 2013
hence you have to weigh your own options carefully. if financing the private means you have to sell the hdb flat at a certain expected amt, then you must also assess if this amount is achievable.
don't worry too much; just monitor the market and perhaps put one or both properties on the market to test water and see how much it can fetch. also helps u to do your sums better.
Newbie
To me the scarry scenario is when:
Interest is back to 4 to 6% !
Very poor rental demand...everybody slashing rental...
large loan exposure.... and job uncertainty...
Newbie
ok, plenty of diverse views. Good and healthy. As all individuals will have their own considerations and judgements, each will decide differently.
On the HDB value that grows with time. It depends on you. You could hold a 3 room flat in town, Maybe Sago Lane, prices 15 yrs ago, $200k, prices now.. above $300k... people buy hoping that the government will chase them out and give them a chance at another Duxton Equivalent. Though so, it is going to be a long time since the goverment just did a lift upgrading there. But it is still worth the money and the wait simply because of the location. And I would say that it will continue to rise in line with Inflation.
Central Area 4 11 to 15 67.00 Improved 1974 $360,000.00 Mar 2010
Central Area 4 06 to 10 67.00 Improved 1974 $333,000.00 Nov 2009
Central Area 4 06 to 10 67.00 Improved 1974 $300,000.00 Nov 2009
Central Area 4 01 to 05 67.00 Improved 1974 $318,000.00 Jan 2010
Central Area 4 01 to 05 67.00 Improved 1974 $293,000.00 Apr 2009
I would decide to do the following if I am in your shoes for your reference. Please make your own decisions.
1. Sell HDB, test if got buyers and really indeed worth $450k. The valuation may say so but no buyers could be found at all.
2. If managed to sell successfully, buy a newer, smaller and better built up HDB at a much BETTER LOCATION. Sengkang resale is a good choice, you have to make that wise choice on your own. The buget will be based on the net proceeds from getting rid of the HDB. Say in the range of $300k. Units should be move in condition, clean and neat will do and not those with fancy ids. As sole purpose is for stay and a possible rental in future.
3. If I buy a resale successfully, it is likely that I stay in it for at least 3 years till my PTE top. So when I move to my PTE, I can rent out my HDB legally. The art of this move is that I have positive equity as no more HDB loan to finance when I sell my HDB, while at the same time I can save to pay for my PTE and enjoy Rent Free HDB and future capital appreciation.
Said enough for you. You have to wise up on your own. Always remember, best advises or general views would not always be right for you without a careful study on your net financial position and your appetite for risk. You have to do that with a professional. That's all.
Newbie
Oh, make it clearer, I mean at a time when CPF is totally locked up or zero. Using Cash to pay either one. So if you have money now. Hold Cash and not pump into CPF account.Yes, am paying by hdb loan, but it is thru cpf, how to delay paying thru cpf? Think unlikely right since it is automatic. Will consider the option of renting out the other room downstairs if need be. Thank you!
new2mondrian,
my hdb is not 22yrs, it is 26yrs now, and 29yrs by 2013
Newbie
Will be contacting an agent to test market, not sure of my hdb valuation, could be less than 400k? I dunno. I bought my flat 5 yrs ago at $240k valuation is $245k. So unlikely valuation can climb so much by 5 yrs, but no matter wat, i will try. If really got ppl willing to pay 500K for my flat, i will sell now and meanwhile stay with my in laws.. They got extra rooms for us.. But after hearing so much views which are really valuable, and being a risk adverse individual, I think I will hold on to just one property for the time being and top up my outstanding loan for my pte property so that i service a lower loan quantum. Meanwhile i can save up all over again and jump in when market is low
Felt much better and less confused. Thank you guys!
Newbie
By the way my hdb is at kovan area, hougang st 22, 10 mins walk to kovan MRT, not sengkang..
东方
I like the state of things if the above come true...
Newbie
There you have it, excellent decision.. even better than the one I suggested. Feels good to decide on your own right? We will all be curious if you manage to sell your HDB and its final price.Will be contacting an agent to test market, not sure of my hdb valuation, could be less than 400k? I dunno. I bought my flat 5 yrs ago at $240k valuation is $245k. So unlikely valuation can climb so much by 5 yrs, but no matter wat, i will try. If really got ppl willing to pay 500K for my flat, i will sell now and meanwhile stay with my in laws.. They got extra rooms for us.. But after hearing so much views which are really valuable, and being a risk adverse individual, I think I will hold on to just one property for the time being and top up my outstanding loan for my pte property so that i service a lower loan quantum. Meanwhile i can save up all over again and jump in when market is low
Felt much better and less confused. Thank you guys!
You are beginning to get the idea of being a prudent property investor. The stronger ones will ride out any recession or interest rates hikes. The destined to fail ones will hope that recession or interest rates hikes will never come. When they come knocking again.... God have mercy on them.
Junior
I am glad you are one of the minority here who have seen the light.
Interest rates reflect the opportunity cost of capital for businesses and investors.
Interest rates are so low today because the world economy (especially US and Europe) is essentially dead.
Once these two powerhouses get out of recession, that's when you see interest rates shoot up, but that's a good thing!
Hence we should embrace interest rates hike when they come knocking, and not run away from it, because it is the God of Fortune knocking.
Propertism Exam Question
What should you do when faced with such high interest rates?
A. Quickly put all your money in the bank to earn this high interest rate.
B. Quickly flip the Straits Times Classifieds to look for properties like these ...
When interest rates go back to double digits like in the 70's and 80's, that'll be really exciting times for the property market.
Just as we have seen the ugly duckling$235,000 Beverly Mai in 1974 transform into $4.4 million when en blocked in 2007
, we are going to see $2.35 million Sail apartments soar into $44 million each!
What's preventing the property market from soaring now is, ironically, the low interest rate environment, which in turn is caused by the lack of business opportunities due to worldwide recession.
On the other hand, when world recession ends and interest rates take off, that'll be like an aeroplane taking off.
Do you jump out of an aeroplane when its about to take off just because the speed is getting too high?
Or should you say YIPPEE!!!
Newbie
Yes, fly in and welcome the GOD of fortune when they come. The REST are murdered by others, die in action, killed by cross fire etc. We are the smaritians and we live to enjoy the recovery thereafter.
Newbie
But we cannot deny the fact that higher interest rate will affect loan burden, especially homes for own stay...
Newbie
Will update once I sell off my hdb
Newbie
legally you must stay in the HDB resale flat...
Newbie
I called up 4 agents from website stating they have ready buyers, have arranged to meet them up via sms. After meeting one after another, all asked me to sign exclusive, felt pressure so I did not sign. I have requested to do a valuation report. The agents said they will ask buyers to drop by, if ok then buy. It is like a fair competition, but I know will have downsides like may take longer time to sell than those with exclusive...However i dunno who to give exclusive rights to, all like quite nice...Is it HIGHLY recommended to give exclusive rights?
Newbie
Yes, was about to advise you that. Don't sign an exclusive. You may be screwed if they play tricks. Do a open listing instead. Just tell them that you don't want exclusive and only want to sell through open system.
http://forums.condosingapore.com/showthread.php?t=9224
Beware... alot of tricks can be used. PM Message me your postcode, I'll reply to you in private. I am not a agent.
Newbie
Almost in a similar situation as ocoloco79 but i took the plunge by renting my 5rm HDB (D22, 100m to MRT) legally for 2.1k. This gave me additional source of income to "flex some muscles" while looking for a private apartment. But damn it, the property market is rocketing.
I can understand where Condorich is coming from when he talks about negative equity position. Wouldn't then the caveat be the amout of loan that you take for the private property? Example, taking a 500k loan for a 700k condo will be on paper less risky and easier on the wallet than taking a 800k loan for a 1mil unit (in ocoloco79's case, 953k unit. Wonder how much loan she took?).
Last edited by levittdub; 14-04-10 at 16:51.
Junior
1st thing on agents' mind is always ask for exclusive.. after that the lazy ones can shake leg relax u see.. of cos very nice to u now
so tell them is co-broke
Newbie
i paid for all newspapers advtg to get my properties (including HDB) sold; in return for 1% agent commission and NO sole exclusive.
in this way my properties were well-advertised (and not mixed with other listings in 1 small column), and the advtg fees were paltry as compared to the price sold and agent fees. hope this helps.
Newbie
Dun mind let agent earn 2%, as long as my house can sell. They happy, I also happy! Am easily contented as long as I can get $480K for my hdb.. even if valuation is $470, I am happy with just 10K COV as long as my house can sell!!! But of course a valuation of $470 will not happen to my flat, hee hee.. I love this forum, the people here are wonderful(except tanumy)!!
Senior
if they want exclusive, tell them to take a hike. a long queue of agents behind them waiting to do your business without exclusive agreement. just see the number of agents by the walkways nowadays. they can always sell their own property, so they'll be "exclusive" agents for their own property lor. You're the provider of capital so the arrangement should be on YOUR terms, not theirs.
Newbie
you are not wrong... but another person may decide differently.
the key is = individuals financial position, i.e. holding power.
which one is the best? It is the one that is best suited to the financial standing of themselves and their appetite or risks.
for ocoloco..It can only be 80% according to my understanding.
Dun bother about caveat.. it is useless in the current context. It is by banks.
Newbie
Just make sure that he has your interest at heart always... may even sell you out and yet you appreciate him like a god when you duno what he did.
Beware the double headed VIPER that sucks and eat your money.
Newbie
friend, bro/sis whatever.. that is what I said.. after 3 years... it used to be 2 years or 5 years... which ever applicable. Check with HDB for the latest policy and rulling. I am not a agent so I dont bother remembering.
Read carefully and please dont be offended. Keep posting and say what you feel... when you said something wrong.. people will correct you and that is when you have learnt something.
Next is to seek free help but decide on your own.
Newbie
We all hate him.. just that others did not voice out. He is sabotaging the development.
The harder he sells, it means that the project cannnot sell at all. T.he A.sshole and U.ltimate M.oron 4 Y.ou
Dont love this forum, it is useless piece of IT junk. Love the people who cares and extend a helping hand to someone who needs it and appreciates it. And that will be quite a number of people who responded to your 'distress' call. Anyway you are in a much better shape now. At least you know what you want to do.
Congrats on your new purchase again.
Junior
The "loan" instalments may increase but not necessarily the "burden".
When interest rates go up, many magical things that can happen.
It may not be what you expect, because the world works in very strange ways.
Junior
i dun hate him leh
the more u all tekan and slam him the more i find it funny
Newbie
Some critical information and the background of this call for advise is available here. Read if interested to find out more. The precursor to the start of this thread by ocolocco79. I think she has the answers and its quite relieved now. She will fly to the sky when her HDB flat got sold and higher if it is at a very good price.
http://forums.condosingapore.com/showthread.php?t=9065
Newbie
Dear Ocoloco79...Dear ocoloco79
Thanks for the compliments, I am no expert at all. Just being prudent and trying to be helpful, for FREE.
Basically no one will be able to make that decision for the both of you. Maybe the following can help you to decide but really, the decision is made again by the both of you.
Earlier on, you were thinking of buying a pte and keeping your HDB. It is sorted out between you and your husband and it is decided to hang on to pte (no matter what). Now you are thinking to keep the HDB or not but cash flow might be a problem. Since the desire to hold both and the ability to hold both don't go hand in hand. So the question is when to sell the HDB if at all.
Do some scenario planning.
1. Sell Now - when prices are at record high
2. Sell in Future - when prices can go up or down
3. Dont Sell Now and in Future - holding power, must have enough cash.
4. Do a double, i.e. Sell HDB and Buy another HDB - tricky decision and maybe the best decision.
1. Sell now. You have control over everything in life. You know the sums. It is very safe, provided you can sell, never sell never know. I would suggest that at least you put it up in the market and see for the very first time whether your unit will sell at a good price or even sell at all. Some HDBs offered for sale real cheap also cannot sell due to west sun, low floor or other negative aspects. Can decide when real actual offers come. The key guard is the granting of option then. Heard that you have bad neighbours (hint).
2. Sell in future. HDB prices can indeed go down. Especially the resale ones. One thing for certain, Cash over value may be gone. Next is that the valuation may have dropped. Prices can also go up too but the question is really can you take the risk of your HDB valuation drop to $400k and below and you cannot sell when you are in times of need. You will then be caught and may have to liquidate your private at a lost. Worst than your earlier position of just holding a HDB as 20% downpayment may be lost. Both of you have to save up again before you can commit again. Which means fallen and have to stand up on your feet again.
3. Dont sell now and in future. Propertism will advice you to do so and same from me. However, it is the cash flow issue again. If I (the both of you too) had enough cash to take the risk, or a lifeline is available, don't sell and keep it till future. No brainer decision. I would be really confident to advice you not to sell if your HDB is fully paid up now. But you have another 10 yrs to go. You may be in a situaton of being in net negative equity when you commit to the pte purchase.
Normally, a HDB upgrader would have fully paid their HDB or at least have the cash reserved for that purpose before buying private. They will buy pte when the cash reserved is more than the outstanding HDB debt. But really, they will only use the remaining cash reserve money (Cash reserve - HDB outstanding = remaining cash reserve) to buy private. It seems to me that the both of you are actually in the net negative equity position when you commit to buy pte. Which means this (Cash reserve - HDB outstanding = remaining cash reserve = 0 or less) But you can still commit to the pte purchase now as (Cash reserved = downpayment for pte) and you have 2 mortgages (HDB and PTE to keep). This can be a real problem for the both of you later on.
4. Do a double. What this means is that either you sell your Bigger HDB flat and Buy another HDB flat immediately or Buy another HDB flat later. If you sell your HDB now, your roof will be gone and you need to rent for 2 to 3 years before your pte top. Assuming $2k per month for renting another HDB (cheapest version), $72k used in rental. But if you have sold your HDB, you would be in very good financial situation to ride out any top up calls. This is provided that you can sell HDB if at all.
If managed to sell successfully, then you can do something called a switch, downgrade from your bigger HDB to a cheaper and smaller HDB (just a basic need for a roof over the head). Which means sell now and buy another 3 bed room HDB flat at a ulu location, best if move in condition. Best location maybe at woodlands or sembawang (just an idea). But if you have the money, switching to a 3 bedder in town (chinatown area), is a better bet. But their prices are expansive. If you can sell your HDB and have $300k as NET PROCEEDS, you might want to consider getting a 3 bedder in town at max $300k. This is the critical point as you don't have any more debts to service for HDB and stay at HDB for free and at the same time, both of you can save to pay for your PTE. This is for buy another SMALLER HDB flat immediately.
Next is to sell successfully, rent another HDB to stay and buy back HDB when you are in a better financial position, maybe after 5, 10, 15 yrs later. Just giving you an idea. Concept of take profit and expect prices to crash later on, a bet. When it crashes, re enter again and you have made a very good investment move.
You want the best option? Get a good investment advisor to advice you BASED on your financial position under various scenarios. When you are clearer about your risks, it is VERY EASY to decide.
Good Luck!
The above are my own views only, not intended to be as professional investment advice (legal disclaimer).
What are your feelings looking back?
I am proud claim that
4. Do a double, i.e. Sell HDB and Buy another HDB - tricky decision and (maybe) IS the best decision
If you have sold your HDB and use the net cash proceeds of $300k to buy another say $300k near MRT or in town HDB for rental (3 Rooms will do fine). You would be having a big smile now.
30 Kelantan Rd 06 to 10 74.00
Improved 1981 $345,000.00 Aug 2010
640 Rowell Rd 01 to 05 74.00
Model A 1984 $317,000.00 Aug 20
4 Sago Lane 06 to 10 67.00
Improved 1974 $372,000.00 Aug 2010
Newbie
Too late for me now
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