Private Property Owners and 2-rm Flexi Scheme

[Kelonguni]

http://www.straitstimes.com/singapor...ment-lease-can

Private property owners finally get a bite of HDB! Only for 40 year or 15 year leases I think based on the table. Hope I am not mistaken though.

It's time for everybody to rejoice!

[Arcachon]

Don't know can give my father example when he buy a 3 room HDB for my grandmother.

[MrTan]

Aiya. Jus give lah. Jus say ur friend's father buy a 3 room hdb for ur friend's grandmother lah.

[Arcachon]

Good idea.

My friend father, 55 years old collect CPF.

He brought a 3 room HDB for his mother using her mother and one of the son name with SGD 25,000. Forget what is the purchase price then.

Years later, his mother passed away and the son sold it for SGD 240,000.

2-rm Flexi Scheme may sound good but without the resale value it is just like paying upfront the rent.

Once you buy can kiss goodbye to anymore appreciation, just like buying a car, if fact worst then a car.

[teddybear]

Buying leasehold properties are just like buying derivatives, both have expiry date, and you get the option to go for a "ride" only (not something I would call "ownership" of the property because you don't owned it, you just RENT for 99 years anyway)...........

But in this case as you said, buying a 2-rm flexi HDB flat is more like buying a car, ZERO capital appreciation you can "ride" on (only depreciation and writing off as time goes by)...............

Good idea.

My friend father, 55 years old collect CPF.

He brought a 3 room HDB for his mother using her mother and one of the son name with SGD 25,000. Forget what is the purchase price then.

Years later, his mother passed away and the son sold it for SGD 240,000.

2-rm Flexi Scheme may sound good but without the resale value it is just like paying upfront the rent.

Once you buy can kiss goodbye to anymore appreciation, just like buying a car, if fact worst then a car.

[Kelonguni]

But what if 60 years old living in private housing with 25 years lease left? Low in cash. Children all grown up just want to retire? Makes sense?

Good idea.

My friend father, 55 years old collect CPF.

He brought a 3 room HDB for his mother using her mother and one of the son name with SGD 25,000. Forget what is the purchase price then.

Years later, his mother passed away and the son sold it for SGD 240,000.

2-rm Flexi Scheme may sound good but without the resale value it is just like paying upfront the rent.

Once you buy can kiss goodbye to anymore appreciation, just like buying a car, if fact worst then a car.

[Kelonguni]

Buying leasehold properties are just like buying derivatives, both have expiry date, and you get the option to go for a "ride" only (not something I would call "ownership" of the property because you don't owned it, you just RENT for 99 years anyway)...........

But in this case as you said, buying a 2-rm flexi HDB flat is more like buying a car, ZERO capital appreciation you can "ride" on (only depreciation and writing off as time goes by)...............

Go ahead and buy an OLD freehold car at 20% higher price than a new 99-year leasehold car ok? People already changed a few cars using new technology, you are still stuck in time using parts no longer in production. Financially shiok feeling maybe, but whether wise or not, depends on lots of other factors. Parts spoilt still gotta repair like crazy.

[Arcachon]

I think Freehold property not equal to OLD freehold car.

Sorry If I confuse Car and property. Not a good example.

[Kelonguni]

I think Freehold property not equal to OLD freehold car.

Sorry If I confuse Car and property. Not a good example.

They can be treated similarly in financial terms if you treat them as rental car. Derivation of utility value also can be treated similarly.

Imagine a Freehold COE vs 10 year Leasehold COEs sure got diehard supporter even if they pay ten times more.

[teddybear]

What "freehold" car? Your car only has 10 years COE, and you get hit with all kind of additional taxes after 10 years even if you renew COE (maciam like extend land lease, even if you are allowed to)............... So, your car only 10-year leasehold lah!
Some times, you may make money selling your car when COE surges (just like when 99-year leasehold property price surges), but you will OUT OF LUCK if you can't sell at a good price before the lease expires (true for both car and 99-years leasehold properties)............

Go ahead and buy an OLD freehold car at 20% higher price than a new 99-year leasehold car ok? People already changed a few cars using new technology, you are still stuck in time using parts no longer in production. Financially shiok feeling maybe, but whether wise or not, depends on lots of other factors. Parts spoilt still gotta repair like crazy.

[Kelonguni]

What "freehold" car? Your car only has 10 years COE, and you get hit with all kind of additional taxes after 10 years even if you renew COE (maciam like extend land lease, even if you are allowed to)............... So, your car only 10-year leasehold lah!
Some times, you may make money selling your car when COE surges (just like when 99-year leasehold property price surges), but you will OUT OF LUCK if you can't sell at a good price before the lease expires (true for both car and 99-years leasehold properties)............

The 100 year old mansion also faces all kinds of maintenance issues after 30 years, not to mention the initial opportunity costs lost in extra financing. Higher loan, higher risk, more interests paid. Much harder to clear tdsr already makes it irrelevant.

Ultimately, it will still depreciate to its land value for en bloc. Admittedly, if land value rises, there may still be good value. But the financing side balances this discrepancy.

Depends also on when govt needs the land too.

OK would you buy a FH COE for 40% more price than a 90 year COE, assuming the former costs 1 million and the latter costs 60,000?

[Kelonguni]

Sorry I meant this:

OK would you buy a FH COE for 40% more price than a 90 year COE, assuming the former costs 1 million and the latter costs 600,000?

Similarly, FH land for 40% more price than a 90 year land, assuming the former costs 1 million and the latter costs 600,000? All other factors, size, location etc equal.

[teddybear]

From your question, I now know that you don't even know what is "investment"...........
Can't imagine people can compare COE to land.............. It is like comparing printed apple on paper to real apple........

The fact that FH land is not priced to perpetual compared to 99-years leasehold indicates significant market distortion and possibly intentional manipulation, otherwise how to encourage people to buy 99-years leasehold properties?????

The fact is, there are abundant of 99-years leasehold properties in Singapore (vs ever shrinking amount of FH land and properties)............. The government will continue to sell lots and lots of 99-years leasehold land and hence properties in Singapore..................

Sorry I meant this:

OK would you buy a FH COE for 40% more price than a 90 year COE, assuming the former costs 1 million and the latter costs 600,000?

Similarly, FH land for 40% more price than a 90 year land, assuming the former costs 1 million and the latter costs 600,000? All other factors, size, location etc equal.

[Kelonguni]

Brother, why not you answer the question directly and I clarify the full logic behind the numbers using real examples? Then you can go on to shoot that I have no idea what is investment. You can choose to use land if you think it's more appropriate - the calculations are the same. As discussed before previously, I hold both FH and LH units. You choose, I clarify. Else, no point.

From your question, I now know that you don't even know what is "investment"...........
Can't imagine people can compare COE to land.............. It is like comparing printed apple on paper to real apple........

The fact that FH land is not priced to perpetual compared to 99-years leasehold indicates significant market distortion and possibly intentional manipulation, otherwise how to encourage people to buy 99-years leasehold properties?????

The fact is, there are abundant of 99-years leasehold properties in Singapore (vs ever shrinking amount of FH land and properties)............. The government will continue to sell lots and lots of 99-years leasehold land and hence properties in Singapore..................

[onglai]

"Like studio apartments, these shorter lease flats will be available to private property owners or those who have previously enjoyed housing subsidies. Flats with shorter leases cannot be sublet or sold on the open market."

so if the owner today buy tomorrow die, sell back to hdb?

[Arcachon]

HDB return the balance of the lease.

[irisng]

"Like studio apartments, these shorter lease flats will be available to private property owners or those who have previously enjoyed housing subsidies. Flats with shorter leases cannot be sublet or sold on the open market."

so if the owner today buy tomorrow die, sell back to hdb?

Private owners can buy the HDB 2-Flexi flat but I think they need to sell their condo within 6 months after collecting the keys, if I'm not wrong.

How is the progress payment like if want to buy HDB 2-flexi flat?

[Arcachon]

Cash, no loan.

[Kelonguni]

Cash, no loan.

CPF showhand?

[Arcachon]

Yes, time on Earth expiring soon for these group of people, call shelf life expire.

Show hand.

[mcmlxxvi]

Private owners can buy the HDB 2-Flexi flat but I think they need to sell their condo within 6 months after collecting the keys, if I'm not wrong.

Yes, you are right. It is stated in the Annex pdf.

It is quite misleading for them to say that 'private propery owners' are also eligible. It is the same for buying resale isn't it, provided they dispose of the HDB within 6 months.

"Private property owners who buy a non-subsidised HDB flat* must now dispose of their private residential property within six months from the date of flat purchase."

*Resale flat bought without CPF housing grant.

[irisng]

Yes, you are right. It is stated in the Annex pdf.

It is quite misleading for them to say that 'private propery owners' are also eligible. It is the same for buying resale isn't it, provided they dispose of the HDB within 6 months.

"Private property owners who buy a non-subsidised HDB flat* must now dispose of their private residential property within six months from the date of flat purchase."

*Resale flat bought without CPF housing grant.

Yup, at first I thought that I'm eligible to buy so that I can stay in HDB and rent out my private ppty for extra income during my retirement. BUT disappointed after knowing that need to sell off my private ppty within 6 months of collecting the key. Did you all think that there seems to have some problem with this ruling? You sell all your "properties", collect the cash, use it to buy an HDB flat that "don't really" belong to you (no wonder someone did mention that HDB is not an asset) because not only the lease is short and it can only sell back to HDB. BTW, can it be passed down to our children? It seems to me that the retired couple can only stay in this "small" flat without income, daily expenses need to depend on their children or CPF Life or their hard-earn savings. With this small amount of money collect every month, just wonder how their life will be in this expensive economy (I don't mean living in luxury life but at least some "sensible" life). Can presume that they might have to be very thrifty with their spending instead of enjoying their retirement age. It will still be fine for those who know how to save their money after selling their property but how about those who do not know how to make use of their money and instead spend all, isn't they are left with nothing on their retirement days except the "so-called" HDB flat. I know of someone, living in a 3-room HDB flat, low income earner, took out his CPF money and buy a car for his son.

[Kelonguni]

Yup, at first I thought that I'm eligible to buy so that I can stay in HDB and rent out my private ppty for extra income during my retirement. BUT disappointed after knowing that need to sell off my private ppty within 6 months of collecting the key. Did you all think that there seems to have some problem with this ruling? You sell all your "properties", collect the cash, use it to buy an HDB flat that "don't really" belong to you (no wonder someone did mention that HDB is not an asset) because not only the lease is short and it can only sell back to HDB. BTW, can it be passed down to our children? It seems to me that the retired couple can only stay in this "small" flat without income, daily expenses need to depend on their children or CPF Life or their hard-earn savings. With this small amount of money collect every month, just wonder how their life will be in this expensive economy (I don't mean living in luxury life but at least some "sensible" life). Can presume that they might have to be very thrifty with their spending instead of enjoying their retirement age. It will still be fine for those who know how to save their money after selling their property but how about those who do not know how to make use of their money and instead spend all, isn't they are left with nothing on their retirement days except the "so-called" HDB flat. I know of someone, living in a 3-room HDB flat, low income earner, took out his CPF money and buy a car for his son.

Wah you asking a lot leh...

Now is giving a chance to cash out private and retire in HDB. The funds returning can put inside SSB (100K) plus other purposes like retirement account and retirement plans. Quite a lot to cash out for a private unit as well - at least half a million.

If a person will anyhow spend, no matter how, will end up overspending. Just a few trips to the casinos alone can wipe out everything.

There is only so much the Govt can do I think.

[Cupcakes]

Forget it

[irisng]

Forget it

Yup, forget about it.

[newbie11]

Of cos hdb is an asset. Every asset has a lifespan. Is there any hdb that's worth a lot less compared with a private with the same remaining lease? Look at hdb landed vs those around rail mall with 30 year left.

[Arcachon]

Asset is one that give positive cash flow.

HDB is only an asset when you sell and have positive return after adjusted inflation otherwise it is not.

Our GDP start from a low base to high, the HDB is able to sell high but in future the story may not be the same.

1969 SGD 6,900 for 3 room HDB now SGD 300,000.

1988 SGD 83,000 for 4 room HDB sold SGD 285,000.

1995 SGD 250,000 5 room HDB value at SGD 640,000.

2006 PC SGD 535,000 now value SGD 1,500,000.

Now HDB ????????

[mcmlxxvi]

Pinnacle already sold 1mil

[mcmlxxvi]

Our physical 'asset's also got lifespan.

Otherwise human race wouldn't have invented tongkat ali, viagra, lipo, botox etc....

[mcmlxxvi]

Yup, at first I thought that I'm eligible to buy so that I can stay in HDB and rent out my private ppty for extra income during my retirement. BUT disappointed after knowing that need to sell off my private ppty within 6 months of collecting the key. Did you all think that there seems to have some problem with this ruling? You sell all your "properties", collect the cash, use it to buy an HDB flat that "don't really" belong to you (no wonder someone did mention that HDB is not an asset) because not only the lease is short and it can only sell back to HDB. BTW, can it be passed down to our children? It seems to me that the retired couple can only stay in this "small" flat without income, daily expenses need to depend on their children or CPF Life or their hard-earn savings. With this small amount of money collect every month, just wonder how their life will be in this expensive economy (I don't mean living in luxury life but at least some "sensible" life). Can presume that they might have to be very thrifty with their spending instead of enjoying their retirement age. It will still be fine for those who know how to save their money after selling their property but how about those who do not know how to make use of their money and instead spend all, isn't they are left with nothing on their retirement days except the "so-called" HDB flat. I know of someone, living in a 3-room HDB flat, low income earner, took out his CPF money and buy a car for his son.

It has been said ad nauseum but retirement - most people can do it after working 10-15 years, but at what quality of life? Can you get by on $10 a day... never able to afford overseas holidays? Maybe only 'overseas' to jb for quick shopping at discount for daily necessities risking your life getting poked and gunned down... if you can call that 'overseas'.

In my semi-retirement, I have collected a whole long list of things to keep you busy and healthy (not vice) and spend your free time, that are FREE... so you spend less time going over and over your excel sheet and living life - a real LIFE. A life where every day you learn new things and see new stuff and maybe even meet and get to know real people. SO perhaps $10 a day is indeed POSSIBLE to be a quality retirement lifestyle in SG.

If you need more than that for retirement, then we better jolly well make sure we continue to roll our assets (4-yr time frame now) until we can comfortably fully own one to stay and one to rent out....? By then maybe inflation until still kena only able to afford jb 'overseas' trip muahahahahaha. SGD says to you 'Catch me if you Can'...