View Full Version : DILEMMA TO SELL OR RENT
I own a LH99 PC with current market value $1.2m which is close to MRT and facilities. I have bought another FH PC (larger unit) which will be TOP soon. I intend to shift to the FH PC when it is ready. I am servicing loan for both. My dilemma is whether to sell the LH99 PC or rent it out. Would greatly appreciate views of fellow forummers.
auroraborealis
16-11-12, 10:48
How old's the 99yr PC? What's ur LTV of old n new based on current mkt values (not purchase price)? What's rent/mth or rental yield based on purchase px & current mkt value?
just my :2cents: if less than 12yrs, both LTV at 60% and rental yield at least 4%, I'll keep both :cheers5:
I own a LH99 PC with current market value $1.2m which is close to MRT and facilities. I have bought another FH PC (larger unit) which will be TOP soon. I intend to shift to the FH PC when it is ready. I am servicing loan for both. My dilemma is whether to sell the LH99 PC or rent it out. Would greatly appreciate views of fellow forummers.
No holding power then sell.
How old's the 99yr PC? What's ur LTV of old n new based on current mkt values (not purchase price)? What's rent/mth or rental yield based on purchase px & current mkt value?
just my :2cents: if less than 12yrs, both LTV at 60% and rental yield at least 4%, I'll keep both :cheers5:
The LH99 is <12yrs and LTV is exactly 60%. Not sure how to calc rental yield for this property. I definitely want to keep the FH PC for own stay.
The LH99 is <12yrs and LTV is exactly 60%. Not sure how to calc rental yield for this property. I definitely want to keep the FH PC for own stay.
Correction: LTV for LH99 is 40% and 52% for the FH PC which is BUC.
Correction: LTV for LH99 is 40% and 52% for the FH PC which is BUC.
my personal view is anything LTV below 50% is healthy and can get the next ppty leow. any correction in ppty unlikely to be >50% from current valuation, and this concept in turn will support the rental to have a minimal price floor, so no matter how u look at it, that ppty is already self-generating.
auroraborealis
16-11-12, 11:48
if me, will definitely keep n rent out for now
Correction: LTV for LH99 is 40% and 52% for the FH PC which is BUC.
Better question is: what to do with the money after selling?
So keep and collect rent.
Better question is: what to do with the money after selling?
So keep and collect rent.
Yup agreed.
And it all depends on your long term plans. If you are about 30 years old then it probably doesn't matter but if you are over 40 then you need to think a bit about your long term goals. I would think it is prudent to keep both properties and create a passive income from the rental of one. Moreover good sentimental value mah, first property. Can show your kids this was your first home, and you can consider moving back there some day. As I said all depends on your age. If you are very young it wouldn't matter.
to quote a famous forummer - property is meant to be bought. not sold.
to quote a famous forummer - property is meant to be bought. not sold.
Thanks very very much to all forummers' advice. This is the power of this website. Within a matter of 1 hour I get so many valuable advice. My gut feel is also to rent out but I worry about value of the LH in 2 to 3 yrs time when a glut in housing is expected. This is in case I have liquidate the property. For info., I am a retiree.
you can rent it out
or you scare cannot find tenant?
Thanks very very much to all forummers' advice. This is the power of this website. Within a matter of 1 hour I get so many valuable advice. My gut feel is also to rent out but I worry about value of the LH in 2 to 3 yrs time when a glut in housing is expected. This is in case I have liquidate the property. For info., I am a retiree.
i would like to share from cashflow point of view. IF u keep it, it creates meaningful positive cashflow for u, bare min a few hundred dollars to $1k or more after loan replayment, i say keep it. A property is only an asset if it generate cash flow. For most pple its a liability as it take away $$$ from them from a cashflow point of view.
i would only say u be worried if your property is not within walking distance to transport nodes/malls in 2-3 years time if there is a housing glut. There will be a big premium and continue to be for those properties.
on the other hand, we dont know how long we have have on earth also.... if u have not really enjoy yourself , take profit and have some self gratification
keep both for above reasons.
only sell if :
got plan to use the money, or
you think further upside at location is capped, then realise the profits and reinvest. take note of admin cost of swap ie stamp, absd if buy 3rd before sell, agent's fee...
soon even 90lh is better than 60lh, so no big issue with age of condo.
rental yield is better than sleepless nights, until you got better buffer.
The LH99 is <12yrs and LTV is exactly 60%. Not sure how to calc rental yield for this property. I definitely want to keep the FH PC for own stay.
If it is already 10 yrs old, suggest to sell it and buy a newer and smaller FH PC (even if it is a studio) near MRT for rental for the same price. Remain invested in property unless you have better use for the money. Forget about the cycles if you have holding power.
just saw the retiree part... Keep both until you want to cash out.
Thanks very very much to all forummers' advice. This is the power of this website. Within a matter of 1 hour I get so many valuable advice. My gut feel is also to rent out but I worry about value of the LH in 2 to 3 yrs time when a glut in housing is expected. This is in case I have liquidate the property. For info., I am a retiree.
I would suggest you keep and rent out one.
Retiree all the more would benefit from passive income.
Annuity type income much better than a lump sum cash saving in the bank.
All the best for your decision.
Thanks very very much to all forummers' advice. This is the power of this website. Within a matter of 1 hour I get so many valuable advice. My gut feel is also to rent out but I worry about value of the LH in 2 to 3 yrs time when a glut in housing is expected. This is in case I have liquidate the property. For info., I am a retiree.
The reason why you have so many responses is because many forummers also have the same question in their mind? Rent out or sell.
Amber Woods
16-11-12, 13:16
Thanks very very much to all forummers' advice. This is the power of this website. Within a matter of 1 hour I get so many valuable advice. My gut feel is also to rent out but I worry about value of the LH in 2 to 3 yrs time when a glut in housing is expected. This is in case I have liquidate the property. For info., I am a retiree.
If your LH property is giving you nett positive cash flow each month, there is every reason to keep it.
However, if you are feeling uncomfortable with the LH property losing its value over time especially in the next 3 years, it does makes sense to liquidate the property when price is high and invest in some other mid-term assets which may still give you the same amount of cash flow if you have kept it (the rental less the loan repayment amount).
You will then be in a much healthier position to invest in a smaller FH property should the opportunity arises. Keeping the LH property means that you may not have this option.
I would suggest you keep and rent out one.
Retiree all the more would benefit from passive income.
Annuity type income much better than a lump sum cash saving in the bank.
All the best for your decision.
Thanks once again to all. I am very enlightened now and should be able to make a rationale decision after discussing with my wife.
If you can withstand a couple of months in a year with no rental, keep it.
U should sell your lh99 and keep cash and buy gold
http://www.youtube.com/watch?v=pTCnxawblyM&feature=relmfu
I hope this thread serves to answer many of these questions.
When in doubt, keep the property la!
You can only afford to ask this question when someone offers you 10% above valuation and ask you to sell !
Always keep cash generating properties.
Remember the Golden Goose ?
DKSG
golden goose lay golden eggs. but still dont keep all the eggs same basket
I own a LH99 PC with current market value $1.2m which is close to MRT and facilities. I have bought another FH PC (larger unit) which will be TOP soon. I intend to shift to the FH PC when it is ready. I am servicing loan for both. My dilemma is whether to sell the LH99 PC or rent it out. Would greatly appreciate views of fellow forummers.
I think it really depends on what you are going to do with the money after selling it.
If supposed you are going to sell and then use the profit to pamper yourself and your wife, by all means go ahead as long as you have already set aside some retirement savings.
However if you are thinking of selling now and then buy later, you will have to do you own math and also be realistic about your ability to buy back. Since you are retiree, would you dare to make such huge commitment when market crash and would you be able to get a bank loan during bad times since you dont have income (I am assuming)
LH property in good location is really worth keeping as it will help to generate some passive income from rental. For LH property, I assume you should have no problem getting >3% rent per month and considering current interest rate, it should be able to generate 1 to 2K positive cash flow, assuming your gearing is <60%.
the other factor to consider is the selling and buying back cost. 3% stamp duty, 1% commission for selling, and 4 years SSD. And who knows, maybe KBW will say Singapore will have to pay ABSD for 2nd property etc.
golden goose lay golden eggs. but still dont keep all the eggs same basket
We are talking about the eggs la! Not the goose.
But wait! Goose comes first or eggs comes first ?
Nevertheless, next time remember to buy my ground floor unit ok ?
DKSG
We are talking about the eggs la! Not the goose.
But wait! Goose comes first or eggs comes first ?
Nevertheless, next time remember to buy my ground floor unit ok ?
DKSG
i orady hap my own grnd flrs
for LH property,if offer price is > 20% purchase price, sell!:D
(provided you have at least 2 investment properties):D
I hope this thread serves to answer many of these questions.
When in doubt, keep the property la!
You can only afford to ask this question when someone offers you 10% above valuation and ask you to sell !
Always keep cash generating properties.
Remember the Golden Goose ?
DKSG
10% above valuation also don't sell. Buy back at valuation still incur 10% cost.
LPPL:tongue3:
http://forums.condosingapore.com/showthread.php?t=15711&page=7
What do this tell you? To Sell or Rent.
All this years I ask myself this question, why is the lease hold in Singapore 99 years and not 60 years. Finally the 60 years is happening before my eyes.
Huat Ah..........
10% above valuation also don't sell. Buy back at valuation still incur 10% cost.
LPPL:tongue3:
Pai Seh ... please use the percentage of the individual's liking la ...
Office Boy make a bit bit sell liao ... haha!
DKSG
I hope this thread serves to answer many of these questions.
When in doubt, keep the property la!
You can only afford to ask this question when someone offers you 10% above valuation and ask you to sell !
Always keep cash generating properties.
Remember the Golden Goose ?
DKSG
I am contemplating to sell the LH99PC if there is an offer of 10% above valuation.
Just to piggyback onto RSG's question, does the age of the existing LH property matter?
Say it's close to 20 years old, would the answers be different? :beats-me-man:
Maybe u should wait until the bidding result of the new LH60 GLS. That would provide a good answer for you. if there is a demand for LH60 pty, then obviously there is no rush for you to offload your 20yrs old LH99 pty...:2cents:
Just to piggyback onto RSG's question, does the age of the existing LH property matter?
Say it's close to 20 years old, would the answers be different? :beats-me-man:
Maybe u should wait until the bidding result of the new LH60 GLS. That would provide a good answer for you. if there is a demand for LH60 pty, then obviously there is no rush for you to offload your 20yrs old LH99 pty...:2cents:
I'm certain there are many like me who is watching this whole LH60 'experiment' very closely. Banks as well too.
I'm certain there are many like me who is watching this whole LH60 'experiment' very closely. Banks as well too.
From a financial and life planning perspective, the 60LH is what we call "One Cent Money One Cent Goods".
A few things to consider :
1) Every building lasts for less than 60 years.
2) Your remaining life (assuming u r like in your thirties) may not be even more than 60 years. Anyway, whether FH, 99, 60, all will be demolished in 30 years, enbloc and sell to developer to rebuild, top up lease.
3) Assuming government is transparent abt their intention to extend the lease during enbloc back to 60 years, there is seriously no impact.
4) Remaining value of a property is ALWAYS the land value.
DKSG
From a financial and life planning perspective, the 60LH is what we call "One Cent Money One Cent Goods".
A few things to consider :
1) Every building lasts for less than 60 years.
2) Your remaining life (assuming u r like in your thirties) may not be even more than 60 years. Anyway, whether FH, 99, 60, all will be demolished in 30 years, enbloc and sell to developer to rebuild, top up lease.
3) Assuming government is transparent abt their intention to extend the lease during enbloc back to 60 years, there is seriously no impact.
4) Remaining value of a property is ALWAYS the land value.
DKSG
Good points but there's one very uniquely 'chinese' behavior you left out and that is to be able to leave your decedents some form of legacy in the form of a house!!! :p
This whole LH45, LH60 experiment may even challenge the way the older folks' traditional view of needing to leave an inheritance behind for their children.
Even my mum who owns a 30 year old flat sees it as her farewell gift to my siblings and myself when she passes on!
So in this sense, freehold/ 999 will be very expensive in the future?
Even old development?
Some may buy in after liquidating their older house and pass the money to their children while they get the 30 LH for their sunset years.
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