Niece purchase Aquarius by the park at 1.08 mil and say still holding it. Rental @ 2,500 per month. Say downpayment 200k. Loan 800k. 30 yr loan. Monthly installment is 3k per month at 2% interest.
http://www.propertyguru.com.sg/proje...park-46/rent/1
She needs to pay monthly - 250 for maintenance, 110 for agent fee (2 years pay 1 month), miscellaneous - 140. Total 500 per month.
All in all, she folks out 3.5k and get rental 2.5k. She tops up the 1 k from cpf or use cash.
She loses 12k per year. Over 30 years - 360k.
Her total investment is 200 + 360 = 560k. House fully paid after 30 years. Monthly rental stays at 2.5k which is a cheap rate. How much is a 5 room HDB renting at????
When she retires, she will collect 2 k every month. I am painting a very bad rental rate.
Do you think Aquarius will be 500k after 30 year ????? You can always rely on cpf as safety net to service the loan. Collect the rental and save and invest in bonds later. The interest you pay on cpf is actually your money. Hahahaha. So it goes back into your account.
I don't believe in putting money into cpf. The money gets stuck there. When it is emergency, u cannot redraw it. Especially when a person reaches 40+ and is fearful of losing his job. When he loses his job, he needs cash, not cpf. All expenses use cash.
If he has a house, he can encash it somehow.... Increase cpf payment and receive rental in cash - food for thought.
Property is brick and mortar..... Bonds can kaput. Property won't. As a safety net, property is safer especially when 1 cannot afford to lose it (the investment).
Different thinking.... No right, no wrong.... Options available.