View Full Version : Own both HDB and Condo – Queries
I live in a HDB flat directly bought from HDB 10 years ago and not fully paid yet. Now I plan to buy a condo and have the following queries:
1. If I buy a Condo, can I live in it and rent out my HDB?
2. How much money from my CPF can be used as a down payment to buy condo? I believe I cannot wipe out all
3. Im looking at NV Residences. Was told that I must sign ‘option to purchase’ and pay 5% before I could do the ‘exclusive preview’
3.1 Can I back out after the preview without penalty? The answer given to me was ‘yes’.
3.2 Will the launch price be the best price or is there a possibility for the developer to lower the price (below launch price) if unable to find buyers due to recent tightening of policy? I was told that the developer will never lower the price below launch price.
Thank you.
I live in a HDB flat directly bought from HDB 10 years ago and not fully paid yet. Now I plan to buy a condo and have the following queries:
1. If I buy a Condo, can I live in it and rent out my HDB?
2. How much money from my CPF can be used as a down payment to buy condo? I believe I cannot wipe out all
3. Im looking at NV Residences. Was told that I must sign ‘option to purchase’ and pay 5% before I could do the ‘exclusive preview’
3.1 Can I back out after the preview without penalty? The answer given to me was ‘yes’.
3.2 Will the launch price be the best price or is there a possibility for the developer to lower the price (below launch price) if unable to find buyers due to recent tightening of policy? I was told that the developer will never lower the price below launch price.
Thank you.
You just joined this forum right?
10 year cannot finish paying want to buy condo? LMAO
I live in a HDB flat directly bought from HDB 10 years ago and not fully paid yet. Now I plan to buy a condo and have the following queries:
1. If I buy a Condo, can I live in it and rent out my HDB?
2. How much money from my CPF can be used as a down payment to buy condo? I believe I cannot wipe out all
3. Im looking at NV Residences. Was told that I must sign ‘option to purchase’ and pay 5% before I could do the ‘exclusive preview’
3.1 Can I back out after the preview without penalty? The answer given to me was ‘yes’.
3.2 Will the launch price be the best price or is there a possibility for the developer to lower the price (below launch price) if unable to find buyers due to recent tightening of policy? I was told that the developer will never lower the price below launch price.
Thank you.
Garmen new ruling is trying to make the trip uneven already...min 10% cash and 70% loan after 30 August 2010 (also subject to bank evaluation of your financial status before loan especially now garmen highlight to make careful check)...renting is possible subject to hdb approval...the rest check with CPF and do your research or play head or tail using one dollar coin to predict price will go up or not...hee:D
You just joined this forum right?
10 year cannot finish paying want to buy condo? LMAO
You seem less friendly in your posts after the long break... :p
You seem less friendly in your posts after the long break... :p
suffring from after shock?:scared-5:
1. If I buy a Condo, can I live in it and rent out my HDB?
YES. Because you have fulfilled the MOP for your HDB
2. How much money from my CPF can be used as a down payment to buy condo? I believe I cannot wipe out all
You need to set aside aminimum sum. How much? Please check with HDB.
3. Im looking at NV Residences. Was told that I must sign ‘option to purchase’ and pay 5% before I could do the ‘exclusive preview’
Who say that? Ask him to eat shit! Sue him if you recorded the conversation.
3.2 Will the launch price be the best price or is there a possibility for the developer to lower the price (below launch price) if unable to find buyers due to recent tightening of policy? I was told that the developer will never lower the price below launch price.
Not 100%. Percentage is higher for reputatable developer.
But initial launch may not be the lowest price. Sometimes you can get a unit at the price lower than initial launching price from resale.
Hope it help. :)
3. Im looking at NV Residences. Was told that I must sign ‘option to purchase’ and pay 5% before I could do the ‘exclusive preview
Utter rubbish ! (I am referring to the agent). Is the market so hot/bad that they have to stoop so low with such unethical tactics?!! I would ask him/her to go fly kite.
Dun fall into their foxhole.
:doh:
rattydrama
02-09-10, 23:49
the more I read I have this feeling that more and more upgraders are keeping their HDBs.
Ask the folks at waterfront wave thread about the star buys..
[/FONT]Will the launch price be the best price or is there a possibility for the developer to lower the price (below launch price) if unable to find buyers due to recent tightening of policy? I was told that the developer will never lower the price below launch price.[/COLOR]
Thank you.
[/SIZE][/FONT]
2. How much money from my CPF can be used as a down payment to buy condo? I believe I cannot wipe out all
The prevailing CPF Minimum Sum will be increased to $123,000 effective 1 July 2010 (source: Straits Times (http://www.straitstimes.com/BreakingNews/Singapore/Story/STIStory_526501.html)). This is a $6k increase from the previous $117,000.
If you are thinking of using CPF to pay for a second property, you will need to set aside half of the prevailing Minimum Sum. This amount is currently $58,500, but from 1 July it will be $61,500.
The CPF policy is: If you are already using CPF for an existing property, you have to first set aside half of the prevailing CPF Minimum Sum in your Ordinary Account + Special Account. Then you can use the excess savings in your Ordinary Account for the second and subsequent properties.
excepts from salary.sg forum
Btw, u can consolidate yr OA+SA (including investments) to make up this half minimum sum.
hope this helps..;)
proud owner
03-09-10, 00:08
excepts from salary.sg forum
Btw, u can consolidate yr OA+SA (including investments) to make up this half minimum sum.
hope this helps..;)[/quote]
hihi
this is new to me ..
i know i have to keep at least 70k ( kiasu a bit) in my OA .. if i plan to use CPF to service mortgage , full or partial ..
do you mean if i already have say 70k in my SA, i can empty my OA for my 2nd property ?
3. Im looking at NV Residences. Was told that I must sign ‘option to purchase’ and pay 5% before I could do the ‘exclusive preview’
hahaha i would love to know who told u this
too bad the new regulatory body is not set up yet or else ... hehe
excepts from salary.sg forum
Btw, u can consolidate yr OA+SA (including investments) to make up this half minimum sum.
hope this helps..;)
hihi
this is new to me ..
i know i have to keep at least 70k ( kiasu a bit) in my OA .. if i plan to use CPF to service mortgage , full or partial ..
do you mean if i already have say 70k in my SA, i can empty my OA for my 2nd property ?[/quote]
Think he is correct.. Even the amount in SRS can be used as part of Min Retirement Sum.
proud owner
03-09-10, 00:28
hihi
this is new to me ..
i know i have to keep at least 70k ( kiasu a bit) in my OA .. if i plan to use CPF to service mortgage , full or partial ..
do you mean if i already have say 70k in my SA, i can empty my OA for my 2nd property ?
Think he is correct.. Even the amount in SRS can be used as part of Min Retirement Sum.[/quote]
thats good news
thanks
devilplate
03-09-10, 00:34
Ask the folks at waterfront wave thread about the star buys..
another example: wharf residences:cheers1:
excepts from salary.sg forum
Btw, u can consolidate yr OA+SA (including investments) to make up this half minimum sum.
hope this helps..;)
hihi
this is new to me ..
i know i have to keep at least 70k ( kiasu a bit) in my OA .. if i plan to use CPF to service mortgage , full or partial ..
do you mean if i already have say 70k in my SA, i can empty my OA for my 2nd property ?[/quote]
hihi..
"excepts from salary.sg forum" is refering to the stuff i quote earlier..
I'm quite sure about this thingy of the OA+SA (including OA+SA investments) can be used to offset that half Minimum Sum. Read it up in CPF newletter or discussion...
Better double check with CPF website..
Nowadays, policy may get "upgraded" :scared-5: to ensure sustainability..
123K is the defacto assumption of 2 owners. Eg; Combination of Mr & Mrs Apple have to be 123K before they use the next dollar in CPF OA to buy second property.
61.5K only applicable for single owner.
And Minimum Retirement Sum is not really equal to Minimum Sum.
Because at age 55, RA kick in and whole set of new distribution from SA to MS kick in.
We see this every now and then.
Just a gently reminder, all bros & sis here please be advise that;
Eg; Mr & Mrs Apple (@ Age 54) combine CPF OA contribution match dollar to dollar for their Apple Condo monthly installment.
Come Age 55 which both DOB are on the same day, MASSIVE SHIFT.
Creation of Retirement Account. Both fall short of the minimum sum and..
PORTION OF MONTHLY OA CONTRIBUTION HAS TO BE TRANSFER TO TOP UP RA. AND THUS, SHORTFALL IN MONTHLY HOME LOAN INSTALLMENT HAS TO BE FUFILL IN CASH.
Talk to your friendly RM, we will be most glad to find some products that suit you.. cashline, reverse mortgage, extending tenure, refin, etc etc... hahhahah...
Think he is correct.. Even the amount in SRS can be used as part of Min Retirement Sum.
thats good news
thanks[/quote]
You just joined this forum right?
10 year cannot finish paying want to buy condo? LMAO
Sooooo.. MEAN!
Maybe he just inherit some estates in peninsula plaza but got lock down by TA or what-so-ever..
Wait he take 1mill of a dollar coins and throw at you then you know...
Sooooo.. MEAN!
Maybe he just inherit some estates in peninsula plaza but got lock down by TA or what-so-ever..
Wait he take 1mill of a dollar coins and throw at you then you know...
ok ok... I was cracking a joke... first thing to do.. repay off HDB fully if so RICH.
Anyway these new measures will affect the property prices for a while... have to live with it.
You seem less friendly in your posts after the long break... :p
Douk... yeah, a little grumpy lately. But it's ok, I will try to be more friendly :)
123K is the defacto assumption of 2 owners. Eg; Combination of Mr & Mrs Apple have to be 123K before they use the next dollar in CPF OA to buy second property.
61.5K only applicable for single owner.
And Minimum Retirement Sum is not really equal to Minimum Sum.
Because at age 55, RA kick in and whole set of new distribution from SA to MS kick in.
We see this every now and then.
Just a gently reminder, all bros & sis here please be advise that;
Eg; Mr & Mrs Apple (@ Age 54) combine CPF OA contribution match dollar to dollar for their Apple Condo monthly installment.
Come Age 55 which both DOB are on the same day, MASSIVE SHIFT.
Creation of Retirement Account. Both fall short of the minimum sum and..
PORTION OF MONTHLY OA CONTRIBUTION HAS TO BE TRANSFER TO TOP UP RA. AND THUS, SHORTFALL IN MONTHLY HOME LOAN INSTALLMENT HAS TO BE FUFILL IN CASH.
Talk to your friendly RM, we will be most glad to find some products that suit you.. cashline, reverse mortgage, extending tenure, refin, etc etc... hahhahah...
thats good news
thanks[/quote]
Sell 1 propety then... or better still, downgrade to studio or 2 bedder units.
rattydrama
03-09-10, 10:10
CPF savings is still giving away interest of 2.5% for ordinary account and 4% for special account.
The mortgage loan interest rate is less than 2% these days.
cheers
You just joined this forum right?
10 year cannot finish paying want to buy condo? LMAO
is very common that hdb is not paid within 10 years. those who take up 25 years hdb loan cannot buy condo???:confused:
devilplate
03-09-10, 11:06
You just joined this forum right?
10 year cannot finish paying want to buy condo? LMAO
got 1mil cash and buying 1mil ppty....wud u take some loan or fully paid in cash??? haha:p
2. How much money from my CPF can be used as a down payment to buy condo? I believe I cannot wipe out all
You need to set aside aminimum sum. How much? Please check with HDB.
If CPF not enough, need to sign a declaration form saying you will sell yr HDB upon completion of new project.
3. Im looking at NV Residences. Was told that I must sign ‘option to purchase’ and pay 5% before I could do the ‘exclusive preview’
You could leverage on this: threaten to report him to the media/authorities, unless he ensures you get first priority to choose. :D
devilplate
03-09-10, 11:34
nothing to sue la....its normal la....submit blank chq written to the developer's project acct together with the authorisation form....be careful of the price u submit....anything below ur expected price, agt will submit ur chq to the developer...tats it
got 1mil cash and buying 1mil ppty....wud u take some loan or fully paid in cash??? haha:p
actually it is very very misleading for the pap govt to call the latest housing rules and regulations as cooling measures.
bcos these measures in the end serves to protect potential property buyers from financial recklessness!
see pap govt so good, think of your welfare!
i hereby rename the cooling measures as Consumer Housing Protection Scheme or CHPS!
dun laff ok! hahaha :D
devilplate
03-09-10, 11:54
actually it is very very misleading for the pap govt to call the latest housing rules and regulations as cooling measures.
bcos these measures in the end serves to protect potential property buyers from financial recklessness!
see pap govt so good, think of your welfare!
i hereby rename the cooling measures as Consumer Housing Protection Scheme or CHPS!
dun laff ok! hahaha :D
70% ltv is to protect the banks....govt safeguard banks first....who cares about speculators...:rolleyes:
70% ltv is to protect the banks....govt safeguard banks first....who cares about speculators...:rolleyes:
same lah, banks protected means indirectly u are also protected!
50% LTV then i say protect the bank
thats the big picture, if u die the bank will also kan chiong :p
nothing to sue la....its normal la....submit blank chq written to the developer's project acct together with the authorisation form....be careful of the price u submit....anything below ur expected price, agt will submit ur chq to the developer...tats it
Not authorization form. Read his post again.
I live in a HDB flat directly bought from HDB 10 years ago and not fully paid yet. Now I plan to buy a condo and have the following queries:
1. If I buy a Condo, can I live in it and rent out my HDB?
2. How much money from my CPF can be used as a down payment to buy condo? I believe I cannot wipe out all
3. Im looking at NV Residences. Was told that I must sign ‘option to purchase’ and pay 5% before I could do the ‘exclusive preview’
3.1 Can I back out after the preview without penalty? The answer given to me was ‘yes’.
3.2 Will the launch price be the best price or is there a possibility for the developer to lower the price (below launch price) if unable to find buyers due to recent tightening of policy? I was told that the developer will never lower the price below launch price.
Thank you.
Look like this investment is quite a big one for you.....Have you decided that this is the right time? Spare cash is important too.:2cents:
is very common that hdb is not paid within 10 years. those who take up 25 years hdb loan cannot buy condo???:confused:
Let me help Condorich to reply.
Common sense! still owe $ to HDB want to buy? Can always buy! But must have cash. 15 years in debt left somemore. Assuming $300k loan for HDB bought 10 years ago at 2.6% HDB loan, monthly installment would be $1361.
He would have paid $1361 x 12 x 10 = $163K
His outstanding is = $245K. If that is the case... might use savings of 245k to fully pay off the HDB rather than to invest in debt.
Be like me... cash rich :)
Owe $ Pay $ also dun understand. Worst than Loan shark runners... at least they know what is owe $ pay $.
devilplate
03-09-10, 20:00
Let me help Condorich to reply.
Common sense! still owe $ to HDB want to buy? Can always buy! But must have cash. 15 years in debt left somemore. Assuming $300k loan for HDB bought 10 years ago at 2.6% HDB loan, monthly installment would be $1361.
He would have paid $1361 x 12 x 10 = $163K
His outstanding is = $245K. If that is the case... might use savings of 245k to fully pay off the HDB rather than to invest in debt.
Be like me... cash rich :)
Owe $ Pay $ also dun understand. Worst than Loan shark runners... at least they know what is owe $ pay $.
mortgage loan is the cheapest loan leh....leverage more on mortgage and zero loan on others for eg. car loan
loan helps to improve ur liquidity to seize any opportunities when arise....if interest rates spikes up...simply use cash to reduce loan amt or change to plans like uob home plus or mortgage one sibor(last time one for one....but now 2/3 nia...not too bad a deal too)....WIN-WIN
Let me help Condorich to reply.
Common sense! still owe $ to HDB want to buy? Can always buy! But must have cash. 15 years in debt left somemore. Assuming $300k loan for HDB bought 10 years ago at 2.6% HDB loan, monthly installment would be $1361.
He would have paid $1361 x 12 x 10 = $163K
His outstanding is = $245K. If that is the case... might use savings of 245k to fully pay off the HDB rather than to invest in debt.
Be like me... cash rich :)
Owe $ Pay $ also dun understand. Worst than Loan shark runners... at least they know what is owe $ pay $.
you are right...absolutely right...unless someone wants to clear their C*F purposely...u know wha i mean...he he:D
the more I read I have this feeling that more and more upgraders are keeping their HDBs.
rent out can give very good yield...also if market crash, still have a roof to fall back on...:D
rent out can give very good yield...also if market crash, still have a roof to fall back on...:D
HDB has become a citizens entitlement. Once you have it, you can keep it. Govt is making is harder and harder for citizens an PRs to get one. They will not be able to close it for citizens but sooner or later..they will close it to PR's. Say when population reach 6.5 million and beyond.
Policy always change. Left wing, right wing.. no wings.
is very common that hdb is not paid within 10 years. those who take up 25 years hdb loan cannot buy condo???:confused:
If got money why can't pay off HDB loan? Why want to buy condo and act rich?
If got money why can't pay off HDB loan? Why want to buy condo and act rich?
alot of people are like that...status is very important for these people...that is why pte pty no matter how expensive...some still bite...:2cents: :2cents: people who go for practicality and down to earth are not coomon species now...
If got money why can't pay off HDB loan? Why want to buy condo and act rich?
newer generations want a bmw on 100% loan, stay condo, dine in classy resturants,go party open cordon bleu.. long gone the days we party wf cocktail and beers and fruitpunch.
wanna look rich and looked up upon by peers
newer generations want a bmw on 100% loan, stay condo, dine in classy resturants,go party open cordon bleu.. long gone the days we party wf cocktail and beers and fruitpunch.
wanna look rich and looked up upon by peers
precisely...some go the extend of borrowing mone from parent cpf..after earning money instead of repaying parent for thier retirement usage,...they go and buy condo and car and some even ask parent to subsidy them further by cash...this is how some people have become...not uncommon..newspapre also mention this...
devilplate
04-09-10, 12:07
If got money why can't pay off HDB loan? Why want to buy condo and act rich?
there r gd and bad debts....all about debt management:)
devilplate
04-09-10, 12:08
precisely...some go the extend of borrowing mone from parent cpf..after earning money instead of repaying parent for thier retirement usage,...they go and buy condo and car and some even ask parent to subsidy them further by cash...this is how some people have become...not uncommon..newspapre also mention this...
sounds like USA spending behaviour
older generations save and save....younger ones spend and spend
sounds like USA spending behaviour
older generations save and save....younger ones spend and spend
USA should learn from Germany in the west...
There was a lot of reply though my queries were not totally answered.
Anyway, Yes my HDB loan was not fully paid yet. Does it mean I cannot take a loan to buy condo? On the surface it looks like paying off the HDB is the right strategy but I realised that it is not the right strategy. Yes, what iam doing coomes with a risk. The question is am I comfortable with the risk I am taking or am I over stretching myself? By the way, if I buy a condo and if it is legal, I still prefer to live in a HDB and rent out the condo. So it is not to act rich.
If got money why can't pay off HDB loan? Why want to buy condo and act rich?
devilplate
04-09-10, 12:55
There was a lot of reply though my queries were not totally answered.
Anyway, Yes my HDB loan was not fully paid yet. Does it mean I cannot take a loan to buy condo? On the surface it looks like paying off the HDB is the right strategy but I realised that it is not the right strategy. Yes, what iam doing coomes with a risk. The question is am I comfortable with the risk I am taking or am I over stretching myself? By the way, if I buy a condo and if it is legal, I still prefer to live in a HDB and rent out the condo. So it is not to act rich.
very hard to access ur current situation unless i got to noe the full picture
if u got remaining HDB loan of 200k BUT u have 500k spare cash....its different story oredi....PM me if u wish to discuss further:cheers6:
Must buy more expensive properties, heavier burden then will spur them to work harder & smarter mah. Otherwise where got progress and how to progress if everybody so contented with so little? :p
alot of people are like that...status is very important for these people...that is why pte pty no matter how expensive...some still bite...:2cents: :2cents: people who go for practicality and down to earth are not coomon species now...
Must buy more expensive properties, heavier burden then will spur them to work harder & smarter mah. Otherwise where got progress and how to progress if everybody so contented with so little? :p
good and bad...it like both sides of a coin..
If I am him, give me forever I will also won't finish paying off the HDB loans. :D
You just joined this forum right?
10 year cannot finish paying want to buy condo? LMAO
Wild Falcon
04-09-10, 17:56
Why not you roll over HDB loan into your new property which means you effectively only have one loan? In short, take on 80% loan on your new property and use part of the proceeds to pay off your HDB loan completely. You ended up with only one loan on our private property. I'm sure your banker can find you a solution. They're a pretty creative bunch :) The law doesn't need to be changed - just tweak the structure of the financing arrangements. There could be slight nuance in the timing of the cash flows (a short bridging loan might do the trick) but the taking up of your new loan and the repayment of the HDB loan can be done concurrently. Just a thought. You may wanna explore this option with your advisor.
There was a lot of reply though my queries were not totally answered.
Anyway, Yes my HDB loan was not fully paid yet. Does it mean I cannot take a loan to buy condo? On the surface it looks like paying off the HDB is the right strategy but I realised that it is not the right strategy. Yes, what iam doing coomes with a risk. The question is am I comfortable with the risk I am taking or am I over stretching myself? By the way, if I buy a condo and if it is legal, I still prefer to live in a HDB and rent out the condo. So it is not to act rich.
precisely...some go the extend of borrowing mone from parent cpf..after earning money instead of repaying parent for thier retirement usage,...they go and buy condo and car and some even ask parent to subsidy them further by cash...this is how some people have become...not uncommon..newspapre also mention this...
Can't put the full blame on them, as their daddy also feels that their children need to look good. The pride's thing pass from generation to generation, and grew bigger.:2cents:
Must buy more expensive properties, heavier burden then will spur them to work harder & smarter mah. Otherwise where got progress and how to progress if everybody so contented with so little? :p
Sound like the current garmen's policy....:cool:
Why not you roll over HDB loan into your new property which means you effectively only have one loan? In short, take on 80% loan on your new property and use part of the proceeds to pay off your HDB loan completely. You ended up with only one loan on our private property.
huh? i won't do that unless currently low interest for pte ppty if can log in for 20yrs. HDB fix rate 2.6% super safe.
Wild Falcon
04-09-10, 20:34
Goodness me. You have to decide what you want. If you wanna buy private property, then of course you have to take bank prevailing interest rate. How can you want to upgrade to private property and still want to take HDB loan rate? Just decide what you want. I'm just responding to the query if one can take a 80% bank loan for his private property with an existing HDB loan. Of course yes. That's provided you take on your new 80% loan (which you have to take ANY WAY as long as you're buying private property) and repay your existing HDB flat loan. Then you effectively only have one loan. Your cash outflow is still the same for your private property had the law not been changed, i.e. 20% only. Substance is the same, only difference is the form. This is the solution for those who somehow cannot foot the 30% upfront payment.
And no you cannot have your cake and eat it. Take on BOTH HDB loan and 80% private property loan. The law is clear. It's to prevent people getting over-leveraged. Now I know Singaporeans are hard to please.
huh? i won't do that unless currently low interest for pte ppty if can log in for 20yrs. HDB fix rate 2.6% super safe.
Can't put the full blame on them, as their daddy also feels that their children need to look good. The pride's thing pass from generation to generation, and grew bigger.:2cents:
yeah cannot put full blame on them, nevertheless,this type of daddy has this type of childern..what can i say? :D :D wait till retirement than no one to feed than start complaining to garmen...the problem become society problem..
There was a lot of reply though my queries were not totally answered.
Anyway, Yes my HDB loan was not fully paid yet. Does it mean I cannot take a loan to buy condo? On the surface it looks like paying off the HDB is the right strategy but I realised that it is not the right strategy. Yes, what iam doing coomes with a risk. The question is am I comfortable with the risk I am taking or am I over stretching myself? By the way, if I buy a condo and if it is legal, I still prefer to live in a HDB and rent out the condo. So it is not to act rich.
So you have "stretched" yourself to come up with 5% cash (assumming your CPF can manage the other 15%) and now realised you have to put up more cash and CPF to buy a private property? Of course it is legal if you have the money but my point is not about legal or not legal. It is about being realistic and living within one's means. There are many people out there who got burnt because they live and borrow beyond their means. Regardless of market conditions, to fully pay up the HDB loan is a prudent and logical measure.
What is the rationale of living in the HDB and rent out the condo? It will make more sense to stay in the condo and rent out athe HDB as the rental yield is much higher. Oh, then you will say but you would buy a small condo unit in town and rent to expats, which is too small for a family of 4, blah, blah, blah...
If you have money, you can do anything you want and you don't have to ask anyone for opinion. Good luck.
Goodness me. You have to decide what you want. If you wanna buy private property, then of course you have to take bank prevailing interest rate. How can you want to upgrade to private property and still want to take HDB loan rate? Just decide what you want. I'm just responding to the query if one can take a 80% bank loan for his private property with an existing HDB loan. Of course yes. That's provided you take on your new 80% loan (which you have to take ANY WAY as long as you're buying private property) and repay your existing HDB flat loan. Then you effectively only have one loan. Your cash outflow is still the same for your private property had the law not been changed, i.e. 20% only. Substance is the same, only difference is the form. This is the solution for those who somehow cannot foot the 30% upfront payment.
And no you cannot have your cake and eat it. Take on BOTH HDB loan and 80% private property loan. The law is clear. It's to prevent people getting over-leveraged. Now I know Singaporeans are hard to please.
Bro, under new rules as long as you have an outstanding loan, you cannot take another new 80% loan lah. Only 70% with a higher cash and CPF component. Did I mis-read your statement?
Geylang OKT
05-09-10, 07:19
You guys can't sleep? :D
Very nice weather.... Ahhhh :D :D :D
You guys can't sleep? :D
The new property rules are keeping us awake.;)
got 1mil cash and buying 1mil ppty....wud u take some loan or fully paid in cash??? haha:p
I will take loan and keep part of the cash.
There was a lot of reply though my queries were not totally answered.
Anyway, Yes my HDB loan was not fully paid yet. Does it mean I cannot take a loan to buy condo? On the surface it looks like paying off the HDB is the right strategy but I realised that it is not the right strategy. Yes, what iam doing coomes with a risk. The question is am I comfortable with the risk I am taking or am I over stretching myself? By the way, if I buy a condo and if it is legal, I still prefer to live in a HDB and rent out the condo. So it is not to act rich.
I agree. I paid up my HDB many years back and we regretted there after. You lose cheap cash leverage that can be very useful for cash growth when time is right. It was something hard to explain to people. Even I had problem understanding then.
What is the rationale of living in the HDB and rent out the condo? It will make more sense to stay in the condo and rent out athe HDB as the rental yield is much higher.
Wrong. If you have a HDB and a condo, yield is better when you rent the condo. Your investment is already fixed and the unit that can fetch best rental quantum gives the best yield.
Only when you already stay in a condo, and considering to invest to HDB or condo to rent, then the yield for HDB is better. :cool:
devilplate
05-09-10, 09:58
Wrong. If you have a HDB and a condo, yield is better when you rent the condo. Your investment is already fixed and the unit that can fetch best rental quantum gives the best yield.
Only when you already stay in a condo, and considering to invest to HDB or condo to rent, then the yield for HDB is better. :cool:
how come u say wrong? rental yield is not based on the quantum it fetches....
a 300k HDB currently can fetch 1.5-1.8k ....min gross yield of 6% ....but too bad got 5yrs MOP to fulfil....haha
devilplate
05-09-10, 10:00
I agree. I paid up my HDB many years back and we regretted there after. You lose cheap cash leverage that can be very useful for cash growth when time is right. It was something hard to explain to people. Even I had problem understanding then.
i learn it thru the hard way as well....not too bad for pte ppty as u can take equity loan but not HDB anymore.....i learn this thru the hard way too...
I agree. I paid up my HDB many years back and we regretted there after. You lose cheap cash leverage that can be very useful for cash growth when time is right. It was something hard to explain to people. Even I had problem understanding then.
I understand the cheap leverage thing but this works under the following conditions:
1) Pte property market is bullish. Does it look bullish now?
2) You have emergency cash to top up. Threadstarter is now struggling.
3) The gain made on the pte property is able to break-even on the "cheap interest" on the HDB loan + outstanding loan.
If say a year ago, I would encourage the threadstarter to do it but not now.
devilplate
05-09-10, 10:11
I understand the cheap leverage thing but this works under the following conditions:
1) Pte property market is bullish. Does it look bullish now?
2) You have emergency cash to top up. Threadstarter is now struggling.
3) The gain made on the pte property is able to break-even on the "cheap interest" on the HDB loan + outstanding loan.
If say a year ago, I would encourage the threadstarter to do it but not now.
it doesnt matter whether bullish or bearish....
u mentioned last yr it is better to leverage but tat becoz its on hindsight.
with 1mil cash on hand and buying a 1mil ppty now...will u take loan or fully paid in cash?
generally speaking, i wud advice ppl to take up less debt bcoz most ppl cannot handle debt well.
its all about debt management:D
how come u say wrong? rental yield is not based on the quantum it fetches....
a 300k HDB currently can fetch 1.5-1.8k ....min gross yield of 6% ....but too bad got 5yrs MOP to fulfil....haha
I think TS means if both are qualify to rent, although based on % gross yield is higher, but in physical $ term, you get more from renting out private. So since invest $ is fixed, might well rent out the unit that fetch higher return. :)
I understand the cheap leverage thing but this works under the following conditions:
1) Pte property market is bullish. Does it look bullish now?
2) You have emergency cash to top up. Threadstarter is now struggling.
3) The gain made on the pte property is able to break-even on the "cheap interest" on the HDB loan + outstanding loan.
If say a year ago, I would encourage the threadstarter to do it but not now.
i think it is good to have less loan, if a HDB unit is not too expensive, just pay off the loan if got enough money as taking loan subsequently with local banks also easier as they will assess your financial commitment...and paying off the loan by 25 years it may be close to double the price of what you are paying for your HDB unit...:2cents: :2cents: so you confirm earn this amount already when you clear the loan early...
devilplate
05-09-10, 10:14
I think TS means if both are qualify to rent, although based on % gross yield is higher, but in physical $ term, you get more from renting out private. So since invest $ is fixed, might well rent out the unit that fetch higher return. :)
den he is refering to cash flow equation....
Dun forget...stay in condo can save more ppty tax assuming ur condo worth much more den ur HDB:p
devilplate
05-09-10, 10:18
i think it is good to have less loan, if a HDB unit is not too expensive, just pay off the loan if got enough money as taking loan subsequently with local banks also easier as they will assess your financial commitment...and paying off the loan by 25 years it may be close to double the price of what you are paying for your HDB unit...:2cents: :2cents: so you confirm earn this amount already when you clear the loan early...
there r other ingredients to tat.....age group, family expenses, any other source of income etc
for those who dunwan invest in ppty at all....yes, it is better off by paying off ur primary residence
I think TS means if both are qualify to rent, although based on % gross yield is higher, but in physical $ term, you get more from renting out private. So since invest $ is fixed, might well rent out the unit that fetch higher return. :)
Yes exactly. Thanks for explaining on behalf.
I understand the cheap leverage thing but this works under the following conditions:
1) Pte property market is bullish. Does it look bullish now?
2) You have emergency cash to top up. Threadstarter is now struggling.
3) The gain made on the pte property is able to break-even on the "cheap interest" on the HDB loan + outstanding loan.
If say a year ago, I would encourage the threadstarter to do it but not now.
1) I will still not pay up the HDB loan. Once you pay, you cannot get the money out unless you sell your HDB. If you sell HDB after >5 yrs assuming for profit, the CPF interest will "eat" your cash portion, so after selling HDB, don't be surprised your cash back ends up with nothing much.
I will also not buy any private ppty as I think it is not sustainable. Agree that it is all abt timing.
2) Of course at all times, if one and his wife lose yr (touch wood) must have at least enough emergency $$ to last up to abt 2 years. That gives us more than enough time to find another job. Bottom-line, you must have enough contingency plan to last a full ppty cycle, given all possibility of worst scenarios like interest hike, job pay cut, extra unit cannot be rented out, etc. If forced to sell, then it is game over.
3) The gain on pte ppty can be >> than interest savings. We are talking abt capital gains. With 200k you are leveraging on 1 mill profit and loss. That saying, the risk can go both ways.
Do I make sense?
1) I will still not pay up the HDB loan. Once you pay, you cannot get the money out unless you sell your HDB. If you sell HDB after >5 yrs assuming for profit, the CPF interest will "eat" your cash portion, so after selling HDB, don't be surprised your cash back ends up with nothing much.
I will also not buy any private ppty as I think it is not sustainable. Agree that it is all abt timing.
2) Of course at all times, if one and his wife lose yr (touch wood) must have at least enough emergency $$ to last up to abt 2 years. That gives us more than enough time to find another job. Bottom-line, you must have enough contingency plan to last a full ppty cycle, given all possibility of worst scenarios like interest hike, job pay cut, extra unit cannot be rented out, etc. If forced to sell, then it is game over.
3) The gain on pte ppty can be >> than interest savings. We are talking abt capital gains. With 200k you are leveraging on 1 mill profit and loss. That saying, the risk can go both ways.
Do I make sense?
Can't argue with that...:)
there r other ingredients to tat.....age group, family expenses, any other source of income etc
for those who dunwan invest in ppty at all....yes, it is better off by paying off ur primary residence
yeap but risky leh...got problem you lose a roof that is over your head or family...for me that must be at least some property clear of mortgage...safer ma...:D :D
yeap but risky leh...got problem you lose a roof that is over your head or family...for me that must be at least some property clear of mortgage...safer ma...:D :D
I 101% agree with you. Things happen.
Pure stupidity
How come no one sees it as OWE 2 instead o OWE 1 (HDB or priavte) only. It is a asset when it is fully paid up. It is a liability when it is not.
Owe $ Pay $!!!
I 101% agree with you. Things happen.
ha ha bo bian...i am those group of investors which are more careful(kia su kia si type)...that is why no good location sure eat type I siam all those...:D :D
devilplate
05-09-10, 12:38
yeap but risky leh...got problem you lose a roof that is over your head or family...for me that must be at least some property clear of mortgage...safer ma...:D :D
doesnt make sense for eg. when one had a fully paid HDB and speculate on 80% condo/landed on the other hand....POK liao bank will also liquidate all ur assets to pay them first:hell-hath-no-fury:
doesnt make sense for eg. when one had a fully paid HDB and speculate on 80% condo/landed on the other hand....POK liao bank will also liquidate all ur assets to pay them first:hell-hath-no-fury:
than too bad lo if speculate until THAT extent...that is why i am careful on choosing pty cannot play play one...
doesnt make sense for eg. when one had a fully paid HDB and speculate on 80% condo/landed on the other hand....POK liao bank will also liquidate all ur assets to pay them first:hell-hath-no-fury:
dEVIL, I thought u are smarter that I think you are but wrong. Quite stopid.
He can always rent out his HDB, sure have people renting it.
Fully paid HDB with HDB loan, bank cannot touch.
Fully paid HDB with Bank loan, can touch here and there
He can play private that is ready built, just make sure it is rentable.
Worst case, re-mortgage his HDB loan into private loan or sell HDB and camp in private. Best right?
Devilplate means what? Devil with a plate or Devil needs the plate to eat?
I think it is the opportunity cost that you have to forgo if you use this sum of money to pay off the HDB loan. You may use this sum of money to invest and gets return of eg. 5-7% per year and then make partial capital repayment. On the other hand, if you are keeping the money in the FD or under your pillow, then you should redeemed the HDB loan entirely. Smart investor usually leverage with calculated risk. If FD only give 1% and the money invested gives 5-7%, it is rather obvious decision.
i think it is good to have less loan, if a HDB unit is not too expensive, just pay off the loan if got enough money as taking loan subsequently with local banks also easier as they will assess your financial commitment...and paying off the loan by 25 years it may be close to double the price of what you are paying for your HDB unit...:2cents: :2cents: so you confirm earn this amount already when you clear the loan early...
This is really true with the recent revision in the NAV. Private property is really high for some new development. I am one of those who has never stay or own a HDB flat. How much is the property tax for a 5-room flat?
den he is refering to cash flow equation....
Dun forget...stay in condo can save more ppty tax assuming ur condo worth much more den ur HDB:p
HDB concession loan should be the last loan to be repaid. This is another privilege of being a Singaporean (not so sure PR qualifies). Interest rates are stable and pegged to CPF AO. Any changes need to be pass by the Parliament. In times of financial hardship, HDB are much much more sympathetic than financial institutions. Banks cannot liquidate your HDB flat even if you are bankrupt, unless the bank is the one financing it and your payments are very late. So unless you are so cashrich and all other loans are repaid, then consider repaying the HDB loan.
devilplate
05-09-10, 17:22
dEVIL, I thought u are smarter that I think you are but wrong. Quite stopid.
He can always rent out his HDB, sure have people renting it.
Fully paid HDB with HDB loan, bank cannot touch.
Fully paid HDB with Bank loan, can touch here and there
He can play private that is ready built, just make sure it is rentable.
Worst case, re-mortgage his HDB loan into private loan or sell HDB and camp in private. Best right?
Devilplate means what? Devil with a plate or Devil needs the plate to eat?
??? if tat person default on payment for the ppty investment when prices crash.....how?
i m not sure about HDB loan as u said bank cannot touch the HDB...
u can no longer take a equity loan out of a HDB....
always better to keep cash reserves den redemn housing loan
devilplate
05-09-10, 17:50
This is really true with the recent revision in the NAV. Private property is really high for some new development. I am one of those who has never stay or own a HDB flat. How much is the property tax for a 5-room flat?
NAV revised twice within a yr:doh:
HDB concession loan should be the last loan to be repaid. This is another privilege of being a Singaporean (not so sure PR qualifies). Interest rates are stable and pegged to CPF AO. Any changes need to be pass by the Parliament. In times of financial hardship, HDB are much much more sympathetic than financial institutions. Banks cannot liquidate your HDB flat even if you are bankrupt, unless the bank is the one financing it and your payments are very late. So unless you are so cashrich and all other loans are repaid, then consider repaying the HDB loan.
Under the new rules, if you have outstanding home loan, you can only take up 70% loan for 2nd propery. if you don't have any outstanding home loan, you can take up 80% loan for 2nd property.
I am wondering izziz better we should repay the HDB loan in full first before going for 2nd property? :beats-me-man:
Under the new rules, if you have outstanding home loan, you can only take up 70% loan for 2nd propery. if you don't have any outstanding home loan, you can take up 80% loan for 2nd property.
I am wondering izziz better we should repay the HDB loan in full first before going for 2nd property? :beats-me-man:
Good question. Easy to see the picture if using actual dollars
Assuming outstanding is 10% on a $500k HDB property, it would be $50k to repay.
Next would be what is the value of your new purchase. Assuming its a $1 million property, 10% of 1 Million is $100k.
In this case, cleary you would be better of to pay $50k (full redeem) than to loan at $100k more.
The critical point is at
Loan to settle HDB (amount) <= additional loan burden of 10%.
Anything less, wiser to settle HDB loan first (Bank loan). If HDB loan, I would not advise to fully settle but to loan 70% from banks. HDB loan = best loan.
Wild Falcon
14-09-10, 13:24
Agreed. Upgraders just have do their own math and cash flow analysis. Doesn't mean die die must keep the HDB loan. Obviously, private property being more expensive than old HDB flats with subsidy, 10% of the private property may exceed the outstanding HDB loan, and assuming one has very tight cash flows, then it may make sense to pay off the HDB loan and take up 80% loan on the private property.
Good question. Easy to see the picture if using actual dollars
Assuming outstanding is 10% on a $500k HDB property, it would be $50k to repay.
Next would be what is the value of your new purchase. Assuming its a $1 million property, 10% of 1 Million is $100k.
In this case, cleary you would be better of to pay $50k (full redeem) than to loan at $100k more.
The critical point is at
Loan to settle HDB (amount) <= additional loan burden of 10%.
Anything less, wiser to settle HDB loan first (Bank loan). If HDB loan, I would not advise to fully settle but to loan 70% from banks. HDB loan = best loan.
??? if tat person default on payment for the ppty investment when prices crash.....how?
yes, that is the case.. no money to pay and so bank will do what they got to do.
i m not sure about HDB loan as u said bank cannot touch the HDB...
Maybe you are not aware, HDB are more understanding than Banks when it comes to default. HDB loan means banks are out of the equation, so banks will not be able to touch you. It's you, CPF Board and HDB, no banks involved. HDB Bank Loan is a different story
u can no longer take a equity loan out of a HDB....
Yes, I should have said downgrade to another cheaper HDB.
always better to keep cash reserves den redemn housing loan
Not for all cases. It is generally better to keep cash though. It depends on cash flow.
http://www.goarticles.com/cgi-bin/showa.cgi?C=1426873
There was a lot of reply though my queries were not totally answered. Anyway, Yes my HDB loan was not fully paid yet. Does it mean I cannot take a loan to buy condo? On the surface it looks like paying off the HDB is the right strategy but I realised that it is not the right strategy. Yes, what iam doing coomes with a risk. The question is am I comfortable with the risk I am taking or am I over stretching myself? By the way, if I buy a condo and if it is legal, I still prefer to live in a HDB and rent out the condo. So it is not to act rich.
There is nothing wrong with the strategy of investing in a condo, provided that you are fully aware of the following:
1) How much return can you get?
What is the "net rental return" from your condo unit? Can it cover your HDB loan? Run a scenario with:
- Realistic rental from a 2/3 bedroom condo in Pasir Ris during bad times
- Minus mthly loan, maintenance, 10% property tax, agent commission
- Factor in increase in interest rate
2) Will prices drop soon?
If you pay 5% deposit today and prices drop 6% tomorrow (or at TOP), you are caught in the dilemma of forfeiting your deposit because you can buy the same unit at lower prices.
3) Are you buying the condo at a high price?
If you take up 80% loan and unfortunately the market drops more than 20% in the future, you own a negative asset (i.e. loan > value of asset). By right the bank can ask you to top up the difference in cash.
4) Are you sure that NV Residences is a good investment property?
You may like to check the URA website to identify similarities of condos that fetch good rental. Go and view more completed properties. Study the location, facilities and tenant profile there. Do your research to avoid regret in the future.
Good luck!
NV is overpriced. Dont fall for it.
My colleague went to see NV. Her Hdb MOP is not yet 5 years so cannot buy anyway. But she commented that NV is good and cheap and she is really very tempted to get one 2+1 unit at $700K+ quantum. She said if not for her MOP, she will submit the cheque liao.
Let me rephrase. The mm in nv is overpriced.
proud owner
15-09-10, 23:16
My colleague went to see NV. Her Hdb MOP is not yet 5 years so cannot buy anyway. But she commented that NV is good and cheap and she is really very tempted to get one 2+1 unit at $700K+ quantum. She said if not for her MOP, she will submit the cheque liao.
seriously ...
did she think it was CHEAP ? and GOOD ?
or simply is it becos thats the one that she can afford ?
My colleague went to see NV. Her Hdb MOP is not yet 5 years so cannot buy anyway. But she commented that NV is good and cheap and she is really very tempted to get one 2+1 unit at $700K+ quantum. She said if not for her MOP, she will submit the cheque liao.
why is it good? :confused:
devilplate
16-09-10, 00:00
700k for a 2bedder wor....cheap mah:p
My colleague went to see NV. Her Hdb MOP is not yet 5 years so cannot buy anyway. But she commented that NV is good and cheap and she is really very tempted to get one 2+1 unit at $700K+ quantum. She said if not for her MOP, she will submit the cheque liao.
can always ask her to que for the next EC or get a resale EC. Buying for self stay right?
If too much money, can ask her mother to buy for her with her money and transfer it to her later, say upon TOP time. Be ready with the risks associated.
If you are buying for own stay and you work around there, I agree that it is value for $. But condos at this location could be harder to sell 10 years later. Higher transportation costs and hassle (e.g. bursting MRT and distance-based fares, petrol, satellite ERP, forever jammed up CTE, ridiculous 70km/h KPE and increasing traffic) are deterrents.
Many HDBs, condos and commercial buildings are getting old near the city center, I guess in 10 years some are likely to be torn down and the land resold to developers. Then everybody will go for these new units rather than those in the far corners of Singapore.
So investment wise I don't really recommend this area. I'm quite sure the additional 1.5 mil FT would prefer somewhere further south.
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