you can actually still use your CPF to pay the 20% downpayment even if you don't meet the minimum sum, all you need is to sign some letter to say that you will sell off your HDB when the private property TOPs.
Newbie
you can actually still use your CPF to pay the 20% downpayment even if you don't meet the minimum sum, all you need is to sign some letter to say that you will sell off your HDB when the private property TOPs.
Newbie
you can proceed to stop CPF monthly repayment for the hdb, but the fact that some of your cpf already went into the hdb does not change.Originally Posted by ocoloco79
So, you will still need to set aside minimum sum if you want to use cpf for the condo purchase.
One alternative is, you can pay back cash to cpf "full principal amount withdrawn plus the accrued interest for the hdb", then this way you will not need to set aside minimum sum when paying for the hdb.
Cons:
voluntary refund of the full principal amount withdrawn plus the accrued interest for your exiting property, you are unable to further withdraw any monies from your OA for this property.
Have u double check each of your Special accounts, like i say if already have 35k liao, then only 25k from ordinary acct will be stuck.
And from now till TOP, both of you working, will continue to contribute to your special account. So by the time TOP, if each have close to 60k in special account, then 100% in ordinary acct can be use for the condo and hdb at the same time.
Yes, but also keep below in mind:
If you are buying a property still under construction – you will be given a grace period of 6 months from the issuance of Temporary Occupation Permit (TOP) to sell your first property.
After the grace period, CPF withdrawals will be stopped for your new property purchase, if you do not meet the MSCC requirement.
Newbie
He is the real guru...
Assuming that the interest rate is at 2.5%... you will have about 20 years left to finance HDB at montly installment of $860... This is ok as one of you can shoulder the burden while the other save. However, with new purchase, loan of around $780 000, assuming that you stretch to 30 years at 2.5%, monthly installments will be around $3k.. cash is involved. Do note that if interest goes up to 4%, it will be around $3.7k... The real nightmare is the fall in your property valuation by more than 10%.... you and your partner might be caught.Condorich,
My hdb outstanding loan is $162300. Cash after paying 20%, which will be in coming May is as good as zero. However, on a rate of at least $4K compulsory savings per month from May, we should have at least $120,000 by the time TOP, self projection at around the start of 2013. This also means that no more luxurious life from now.. No more shopping at boutiques and no more fine dining. REno cost I dunno will need how much, can only know when the time comes.
Erm..... You always hit the jackpot. I am a chinese teacher, but I love my job. Just ended 1 week holiday.. luckily it all happened during holidays..
When you have near zero cash remaining.. that is something to worry about.. naked. Should anything bad happen, both will be screwed, save for fairy god mothers.
You are almost barely able to afford the purchase. Either choice is alright provided you have luck and things remain constant for you. But they don't always be as planned.
The 2nd CPF property rule... ask your lawyers. You are doing a switch which may not relieve you from the rule.. excess CPF is not wasted as it sits in the account earning interest at 2.5% and acts as a buffer for unemployment.
Taggy,
Would it be wiser to transfer full HDB loan to me, and then my hubby pay for the condo? So both need not set aside min sum? But if that is the case, would it be a waste as I will have excess of cpf which could have been use to top up further for the condo.
As mentioned before... it is very risky for you and your partner and I would deem it as a borderline case... it's really up to you and things can go either way... go in only if you and your partner are ready for the risk... can't say much more.
Newbie
Not an option for them.One alternative is, you can pay back cash to cpf "full principal amount withdrawn plus the accrued interest for the hdb", then this way you will not need to set aside minimum sum when paying for the hdb.
Cons:
voluntary refund of the full principal amount withdrawn plus the accrued interest for your exiting property, you are unable to further withdraw any monies from your OA for this property.
This is why they are buying under construction project and not those ready built. Got some space to save before the real deal.Have u double check each of your Special accounts, like i say if already have 35k liao, then only 25k from ordinary acct will be stuck.
And from now till TOP, both of you working, will continue to contribute to your special account. So by the time TOP, if each have close to 60k in special account, then 100% in ordinary acct can be use for the condo and hdb at the same time.
Which means either you sell or you pay more in cash... cash cash cash... money money money... solves all the problem isn't it?Yes, but also keep below in mind:
If you are buying a property still under construction – you will be given a grace period of 6 months from the issuance of Temporary Occupation Permit (TOP) to sell your first property.
After the grace period, CPF withdrawals will be stopped for your new property purchase, if you do not meet the MSCC requirement.
A prudent investor would sell HDB and stay in a ready built new condo... when prices correct, they buy back HDB...
A risk taker investor would hold on to both and hope for the best... when they lose, they lose big... either win or lose.
A fool is someone who don't think about all things that could go wrong and at least have some plans for them.
I wish you Gd Luck again
Global recession is coming....
Actually, given your situation, if you had bought another property of the same sale price (that you paid for this yet to be built property) and you can move in immediately (i.e. resale properties) and then proceed to sell your HDB flat, you actually can afford that private property very well and comfortably. What you can't afford is to hold 2 properties at the same time ending up with no cash buffer, made worse by the fact that you bought a property which will take another 2-3 years to build while you immediately need to start to pay the 20% down payment and then further interests on the loan drawn down. Tough decision though. If you have parents to loan you money in case of emergency (though you don't need now), still can go for it as why waste the $12k? The purchase is not that bad anyway (as you are not paying like $1200 psf as like The Vision or Centro in AMK) and if you can hold long enough, it is also good force savings for both of you.
We are like that (me included), too much cash in pocket will start spending on luxury items (but they are really unnecessary).
Jlrx,
I am impressed!!!!, Really! We didn't even know that!
Condorich,
My hdb outstanding loan is $162300. Cash after paying 20%, which will be in coming May is as good as zero. However, on a rate of at least $4K compulsory savings per month from May, we should have at least $120,000 by the time TOP, self projection at around the start of 2013. This also means that no more luxurious life from now.. No more shopping at boutiques and no more fine dining
Erm..... You always hit the jackpot. I am a chinese teacher
Taggy,
Would it be wiser to transfer full HDB loan to me, and then my hubby pay for the condo? So both need not set aside min sum? But if that is the case, would it be a waste as I will have excess of cpf which could have been use to top up further for the condo.
Newbie
Erm... giving up the car is also an option.
Newbie
Can rent out the room or rooms in HDB also... or to rent a room to stay while they rent out their whole HDB.
Basically.. its a matter of cash flow...
It is up to individual's appetite for risk, they are held liable for their own mistakes if any anyway.. jointly and severally.
Hold two properties... let one self finance it through rental and live and pay in another is a good bet. However, it is not always a sunny day... no rental, no job and cash top up, interest rate hikes.. Only they will have the answer... do think carefully over the full 3 weeks period.
BTW.... government released more land... read about it by reporter later on. For now, the headlines
Business Times - 24 Mar 2010
Govt releases 4 home sites in one go
Reiterates supply of land, homes enough to meet demand
By UMA SHANKARI (SINGAPORE) Four more residential sites - on which more than 1,200 private homes can be built in total - were released for sale by the government yesterday.
...
Yesterday, URA said it is releasing three residential land parcels - one each at Boon Lay Way, Simei Street 3 and Stirling Road - for sale. The agency last released three sites for sale at one go in January 2000.
...
draw your own conclusions
Big is Wonderful.
ocoloco79,
2 factors influences property buying for own stay - affordability and sentiments /feel of the said property.
On affordability, from the figures you have shared, I see that this is a non-issue for you and your hubby. 80% loan with full loan kicking in 3 yrs time, 3 yrs period for saving up, spare cash in CPF for buffer, a high profits 5-rm HDB in the bag, no other loan liability except for car loan, etc....You are in much better shape than many buyers in today's market who have jumped on the bandwagon blindly.
On sentiments/feel for the project, you have said that both you and your hubby love that place. That is a very critical component in your decision-making process. If you have an emotional attachment to the place and are attracted to it and desire to live there with your family happy ever after, then you have answered your own question. The enhanced lifestyle of living in condo vs HDB is well worth it.
Go for it.
The $12K lost could buy you a few pieces of LV bags or good holiday in Europe or that moth-watering diamond ring...
Newbie
you are a greenhorn for obvious reasons...
Why decide for them? Are you going to bear the losses when their venture turn sour? They will not share their profit with you when they gain.
So Bold some more... What do you gain out of it... be careful as your talk could cost them their future. Could even end up in divorce.
Let them decide for their own good. Money is not just the thing at stake.
Last edited by Condorich; 24-03-10 at 11:59.
Junior
lol like i said, in an up market, everyone is an instant guru
Newbie
I am reali grateful for all your insights, and we are very touched by the fact that you guys are so helpful and willing to share. After discussing with my hubby while we went through the posts here, we might consider selling our hdb, but if we can manage with 4K to 5K savings before TOP, we will keep.
By the way, what has new release of homes got to do with making a decision? Sorry I am not good in economics, does it means lower price in future??
Greenhorn,
I have given up my dream bags and holidays for this purchase le
Newbie
Condorich,you are a greenhorn for obvious reasons...
Why decide for them? Are you going to bear the losses when their venture turn sour? They will not share their profit with you when they gain.
So Bold some more... What do you gain out of it... be careful as your talk could cost them their future. Could even end up in divorce.
Let them decide for their own good. Money is not just the thing at stake.
Dun worry, I know you definitely mean well and I am reali very grateful for all your insights, you are extremely knowledgeable and what ever you said are very real and hard facts of life which we need to take into account in our decision. Greenhorn is just statin his own opinion which in fact is very valuable to us as we need his comforting statement to move on if we decide to remain status quo. In the end we have to decide on our own and cannot blame anyone for whatever outcome.
Newbie
are you on progressive payment ?
Newbie
You are welcome.. in fact you have the answers... I was being kind to greenhorn as he/she may not know what he is getting into... but I agree with you that he meant well.I am reali grateful for all your insights, and we are very touched by the fact that you guys are so helpful and willing to share. After discussing with my hubby while we went through the posts here, we might consider selling our hdb, but if we can manage with 4K to 5K savings before TOP, we will keep.
By the way, what has new release of homes got to do with making a decision? Sorry I am not good in economics, does it means lower price in future??
Greenhorn,
I have given up my dream bags and holidays for this purchase le
Basically it is demand and supply (economics)... all things constant.. more supply would mean cheaper... less supply would mean dearer...
Same goes for demand... more demand would mean dearer... less demand would mean cheaper
This two goes hand in hand and that is why it is difficult to predict.
In simple terms... remember the ever green Hello Kitty/Tamagotchi examples... long long ques... all want it... can resell it at a quick profit.... but things changed.... many hello kitties in the market... sell below cost or even giving it away for free..
Normally I would not share more than what I should but in your case, I shared more. Simply by the fact that you shared more.
In fact... you are fine as long as a life line is available to you... $50k or $100k ... go find your life line and CONGRATS!
F01 N54 Sheer Driving Pleasure
There can only be 1 answer to choose from for this question now.
Last edited by Reporter; 24-03-10 at 13:07.
Newbie
80% Normal progressive with 3% - $5400 buyers and sellers duty (if sold within a year)
Newbie
No body can help answer the question for you. But you should know in your gut now, whether to proceed.
The bottom line is always, do you like the property enough to go for it?
And you have to be very clear to your/hubby's minds what is the key reason for buying this property.
That has to be balanced with the risk with buying the property.
You know the answer in your heart. listen to it.
Big is Wonderful.
Wahh...so hot. Loosen up, man. Why so emotional?you are a greenhorn for obvious reasons...
Why decide for them? Are you going to bear the losses when their venture turn sour? They will not share their profit with you when they gain.
So Bold some more... What do you gain out of it... be careful as your talk could cost them their future. Could even end up in divorce.
Let them decide for their own good. Money is not just the thing at stake.
I may be a greenie, but i am condo rich. hehe
Live the dream...
Newbie
LOL... its your FONTS!... diffference between this and this.Wahh...so hot. Loosen up, man. Why so emotional?
I may be a greenie, but i am condo rich. hehe
Live the dream...
No worries... I am not hot lah... no need to lossen up also... and definitely not emotional.. just feel that we should not decide for others as they really need to decide for themselves, in particular your "Go for it" and nothing else. Balanced views given so they are in a better position to decide.. as they say.. go in with their eyes wide open...
Greenhorn do post more and then you will not be green anymore... you meant well too.
I can see that you are making fun of my nick back. Let's hope for the best for the benefit of all current property owners... Cheers!
Newbie
Newbie
Business @ AsiaOne
Fire sale: Owners dump condos
Stock market losses have forced some property owners to resort to 'fire sales' for a quick return to liquidity.
Elysa Chen
Tue, Oct 21, 2008
The New Paper
FOR sale: Luxurious multi-million-dollar apartments, not quite for a steal, but with a hefty discount.
Stock market losses have forced some property owners to resort to 'fire sales' for a quick return to liquidity.And because the property market is almost flat, they have had to let go of their property at huge discounts.
Property agent Henry Neo receives one SMS a day from different clients asking him to sell their homes.
Mr Neo, who has been a property agent for close to 20 years, said: 'The Asian financial crisis of 1997 and this crisis are real challenges.
'It's a tsunami of the stock market.'
Two or three of the 50 clients he is servicing now are what he calls 'desperados' - people who had their fingers burnt so badly in the stock market they need to sell their houses.
The situation is worse for those who opted for deferred payment schemes, said Mr Neo, because some are no longer eligible for loans, and cannot meet payments once the developers issue the Temporary Occupation Permit (TOP).'They have to get rid of their properties before TOP, so they would be giving even more discounts.'
Noting that the high-end property market seems to be hit the hardest, Mr Neo said: 'My colleagues who specialise in high-end properties are not doing well. They do not have any transactions at all.'
Mr David Cheang, senior vice-president of the Resale Division at HSR Property Group, noted that two out of every 10 clients are affected by the stock market crash, and are selling their property investments to 'get more liquidity'.
A property agent who declined to give his full name said one of his clients had made such losses on the stock market that he was selling his 27th floor freehold apartment at the Twin Regency for a mere $1.05 million, though its market price is $1.3 million.Last year, he had sold another unit, on the 29th floor of the same condominium, for $1.4 million.
It is the same story for Mr Felix Young, 35, a property agent specialising in high-end condominiums. Some of his clients are prepared to go as low as 20 per cent below their offer price.He had taken out an advertisement for five properties, all high-end condominium units in the city.
Apartments at The Sail at Marina Bay, which were going for $2,000 psf are now being offered for sale at $1,450 psf, said Mr Young.
But even such a huge discount is failing to entice buyers, who are asking for $1,100 psf. That is because even with such discounts, the two-room apartment costs about $1.3 million.
In the current climate, not many people would be able to shell out that kind of money because they could be sitting on huge paper losses in the stock market.Mr Young said: 'Buyers have the sentiment that the property market will cool even more, and prices will drop further.'
And because of this, said Mr Young, there has been a significant drop in transactions - up to 70 per cent for high-end properties that people buy for investments.
Most buyers also know developers' launch price for the condominiums and are holding out until they can get a unit at that price.
He said: 'These days, when buyers call me, they ask me if I have any owners who are 'bleeding'.'
Bleeding is a term that is used to describe owners who over-committed themselves financially and need to sell their properties in a hurry.
Mr Young said: 'Many of my clients' bank loans are kicking in soon, so they need to release the properties quickly, before TOP.
'They are stuck because they can neither sell their property, nor rent it out to cover their mortgages, as the rental market has slowed down a lot.'
This article was first published in The New Paper on October 19, 2008.
It happened! Even the experts could not predict the crisis... It will happen again... just when.. Though it is more resilient now with the removal of the DPS and the 80% rule.
That's why a lot of people are rushing in to buy thinking that it is not likely to happen again so soon... but who really knows??
The rule of thumb... buy within your means. Sleep peacefully debt free.
Newbie
With a household income of $10K+, you are in very good shape to buy and hold your new house for a long long period. I assume for the new house, you are only taking a loan of S$650K...that translates to $2K+ per month only in normalised interest. Your HDB loan will pay for itself via rental and you get to make $1K more to pay towards your new house instalment.We are actually HDB upgraders. Not sure of we reali can sustain in terms of liabilities in the long run. Initially my budget is $600K for min 2 brm, anything above is considered out of reach to me. I had been searching around for sometime but nothing matched my budget and price kept increasing like crazy. So we increase our budget to $800K max which could be a little tight on us, but it is easier to find. Then suddenly for dunno what reason we actually committed to this particular unit after the agents sweet talk. Both my hubby and I are civil servants with monthly household income of 10K plus abit only. Our liability would be our HDB flat loan at abt $800+ per month deducted from cpf, plus car loan at abt $600. No other liabilities unless you consider giving parents abt $800 a month is counted as one. Our current monthly savings is abt 3 to 4K per month, which can fluctuate...Once we paid the initial 20% downpayment in cash, we become poor le
Newbie
not necessary, some projects still not completely sold are still offering IAS
Newbie
he said now.. after cut off date... some projects which were offered before the cut off date were allowed to continue to offer them.
Newbie
Agree. Sell and make profit. Rental is a lot of churn.
Newbie
ERm no, we are taking a loan of $763000 for 35 years loan.. so not reali 2K plus leh.. But I am reali glad that now we have an even clearer picture of wat risk we could face.. Esp on the article above regarding owners dumping condos.. so scary.. How I wish I can buy a condo during that time.. but cannot because of HDB MOP for 5 years
We dun bear to sell our hdb cos we reali hope to stay there upon retirement. It is a dream place to stay minus the irritating neighbous above...But if left with no choice, have to give it up..
Newbie
ok.. in case you think that selling HDB is a bed of roses.. it is not.. some units may take years at a huge discount...ERm no, we are taking a loan of $763000 for 35 years loan.. so not reali 2K plus leh.. But I am reali glad that now we have an even clearer picture of wat risk we could face.. Esp on the article above regarding owners dumping condos.. so scary.. How I wish I can buy a condo during that time.. but cannot because of HDB MOP for 5 years
We dun bear to sell our hdb cos we reali hope to stay there upon retirement. It is a dream place to stay minus the irritating neighbous above...But if left with no choice, have to give it up..
and do note that the valuation will go up and down, the way is not always up. See post 1997... 2004... some selling below valuation with no buyers.
If you are faced with a loan suspension for your private apt... most probably your hdb value would fall also. That could spell doom.
I would suggest that you sell HDB NOW and and move in to a ready built condo but that is not possible, you need a roof.. just hope that the prices hold steady at least till TOP. Again, a available life line is all the difference. Gd Luck!
Newbie
May I know if margin calls is calculated this way? For instance in my case, my property cost $953K, later economic down turn, my pty value dropped by 20% to $762400. Bank will ask for margin call to top up the difference of $190600 in my case? Normally how much do we need to spare aside as cash to prepare for margin calls?? On the other hand, suspension of loan means bank will not lend me money and I need to pay one shot $700 over thousands to developer???Thanks!!
Thanks
Newbie
Sorry cannot help you with this one because never encountered. What I know is that it happened to some buyers before.
The banks will inform you if you need to top up or when they will suspend the bank payment to developers. That is when you need to pay cash direct to developers. I would say that you will need to top up when the valuation is less than the outstanding loan granted say, valuation dropped to $700k and outstanding loan $800k.. may have to top up $100k (but again, please excuse me here if incorrect)
There's a trigger point when the value falls below a certain trashhold..
Perhaps the other experienced forummers could help you on this.
Last edited by Condorich; 24-03-10 at 18:28.
Newbie
A lesson learnt.. never succumbed to hardselling or pressures.. If I had more time to do homework or to ask for everyone opinions here, I will hold back and wait. At most live in hdb forever and be worry free....Haiz...
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