Getting a condo. Objective advice appreciated

[MrCoconut]

Was planning to upgrade from my 5 room HDB at hougang to a condo. Worked for 7 years, saved quite a bit, and thought I was ready. Instead, I was surprised and disappointed to be actually priced out of getting one.

Downpayment too much, have to pay ABSD first also. Actually, I have fine remaining at current place. But of course the Singaporean dream. Worked hard saved hard to aspire for a lifestyle upgrade, but in the end, actually it is still out of reach.

On the other hand, I cannot get around the fact paying 3 times more for a place half the size of my current place. The stamp duty, agent fee, lawyer fees etc. I feel money can be better spent elsewhere.

What are your thoughts?

What are some of the reasons you guys upgraded from HDB to condo?

 

[Forever84]

Well you can downsize abit so it's more affordable.

Honest opinion, I prefer smaller home because the lack of space makes me think twice about buying stuff. Stuff which I probably don't need.

 

[bolster]

Sad to say, 90% of the millionaires in Singapore are related to property.

But again, most of the bankruptcy related to business.

What are you waiting for? Invest or work?

 

[SBC]

Hougang is one of the cheaper HDB estate. To upgrade from HDB at Hougang is 1 thing. To compare its delta to condo will be v high.

Consider to look out private in secondary market.

 

[Passerboy]

I think you should look at your comfort level.

A home is primarily a sanctuary for stay, before investment. If you do not feel comfortable with the down payment, then perhaps the time may not be now.

 

[MrCoconut]

I think out of reach for me as investment as I definitely cannot afford the ABSD. Not even downpayment.

The time may not be now. But when my earning power increases, a 2bedder will then cost 1.5million. so it seems I will always be playing catch up.

If I change from a 5 room HDB to a 2 bedder condo, I don't really see that as an upgrade :/

 

[Fattyboiboi]

5rm hdb size how to compare to condo size. Unless u take 5rm hdb size compare to 4/5br condo size if not in terms of size, no 2br condo can ever match your current place.

I think out of reach for me as investment as I definitely cannot afford the ABSD. Not even downpayment.

The time may not be now. But when my earning power increases, a 2bedder will then cost 1.5million. so it seems I will always be playing catch up.

If I change from a 5 room HDB to a 2 bedder condo, I don't really see that as an upgrade :/

 

[NiShiZhu]

Recently, I noticed that the valuation for HDB has dropped significantly. This happens to my cousin’s place when she intend to sell her HDB to upgrade to condo. Buyer decided to forfeit the deal after discovering need to top up the cov by a big sum. I suggest u rather stay put first because currently, the disparity between PC and hdb price seems to have widened by a lot.

Keeping your hdb and buy a condo is also not a smart move due to ABSD.

 

[1993newbie]

Disparity between HDB & PC has widened by quite a lot. Paying ABSD is totally not worth it in my opinion.

Valuation for HDB has dropped over time too.

My parents flat for example,Bukit Panjang, same level 5 room selling at $320k in sept 2019 sales of balance. It’s a repossessed unit btw.
Just next door a 5 room was sold at $375k just last year. My parents has no intention to sell their 4room flat.

 

[ralphlauren]

I’m in the midst of selling my hdb first then slowly shop around for condo just to siam the absd which I think super bohua. Cash proceeds after selling off my current 3 bedrooms hdb is abt 100k. Also quite concern about monthly repayment (cash portion after cpf) if getting a PC for about 1.5mil.

 

[NiShiZhu]

I’m in the midst of selling my hdb first then slowly shop around for condo just to siam the absd which I think super bohua. Cash proceeds after selling off my current 3 bedrooms hdb is abt 100k. Also quite concern about monthly repayment (cash portion after cpf) if getting a PC for about 1.5mil.

How much cash u need to pay monthly after cpf deduction if u buy the 1.5mil PC?
My guess is if u take 30 years loan, at interest rate 1.86%, your monthly installment is about 4.1k. This is excluding the maintenance fee.

 

[weng]

Prudence/staying rational aside, I think there are ways to work around to fork out the initial commitment. If you have somewhere to bunk in for short term (ie. parent's place), can consider selling the flat first. Thereafter look for a resale unit (ideally you should already have somewhere in mind, or better still, have viewed, nego-ed, and mutually agreed a timeline). If nowhere to bunk, then probably set aside a sum for short term rental. Yes that will be additional expenses but I think is a trade-off for the sake of recouping all possible monies from the flat first + avoid paying ABSD upfront.

Of cuz, the risk is that if any deal falls through, you continue to be "homeless" until you finally secure a unit.

Resale also a viable choice cuz no need to wait few years, and 3 bedders in Hougang won't need 1.5mil.

 

[ralphlauren]

Erm... I also dunno how much cash I need to top up. I lookup the calculation at cpf website sibei confusing. So I agar 4.1k per month and half of it goes to cash.

How much cash u need to pay monthly after cpf deduction if u buy the 1.5mil PC?
My guess is if u take 30 years loan, at interest rate 1.86%, your monthly installment is about 4.1k. This is excluding the maintenance fee.

 

[MrCoconut]

I’m in the midst of selling my hdb first then slowly shop around for condo just to siam the absd which I think super bohua. Cash proceeds after selling off my current 3 bedrooms hdb is abt 100k. Also quite concern about monthly repayment (cash portion after cpf) if getting a PC for about 1.5mil.

I've done my calculations. 1.5mil will need at least 4k of repayment every month. I don't know how much you earn. But I wouldn't feel comfortable maxing out my CPF to pay for it. At most half CPF half cash. Then again u need to ensure you earn more than 4k (maybe 10k to be safe) up to the age of 65. I assuming here also.

Is it must sell of HDB then only can Siam ABSD? Can be MOP already, book unit without paying ABSD? Because definitely won't be able to afford the ABSD without the cash from HDB sale.

 

[weng]

I've done my calculations. 1.5mil will need at least 4k of repayment every month. I don't know how much you earn. But I wouldn't feel comfortable maxing out my CPF to pay for it. At most half CPF half cash. Then again u need to ensure you earn more than 4k (maybe 10k to be safe) up to the age of 65. I assuming here also.

Is it must sell of HDB then only can Siam ABSD? Can be MOP already, book unit without paying ABSD? Because definitely won't be able to afford the ABSD without the cash from HDB sale.

As long as the condo is your 2nd property, you have to pay ABSD. You can claim refund after selling your flat (such that the condo becomes your 1st property) within a certain period (iirc is 6mths).

If you want to totally siam ABSD, gotta sell flat first such that when you buy the condo, it is your 1st property (ie property count =1).

 

[MrCoconut]

As long as the condo is your 2nd property, you have to pay ABSD. You can claim refund after selling your flat (such that the condo becomes your 1st property) within a certain period (iirc is 6mths).

If you want to totally siam ABSD, gotta sell flat first such that when you buy the condo, it is your 1st property (ie property count =1).

must be officially hdb is sold? OTP granted can? i am anal, i wish to have a seamless transition rather than be "homeless" for the interval.

 

[runforyourlife]

I think out of reach for me as investment as I definitely cannot afford the ABSD. Not even downpayment.

The time may not be now. But when my earning power increases, a 2bedder will then cost 1.5million. so it seems I will always be playing catch up.

If I change from a 5 room HDB to a 2 bedder condo, I don't really see that as an upgrade :/

If u are looking for like for like, you’ll never be able to upgrade one unless u have 1M in savings.

 

[MrCoconut]

If u are looking for like for like, you’ll never be able to upgrade one unless u have 1M in savings.

realistic enough that i'm not looking for like for like. but just looking at space wise, giving up a 5 room space for a 2-3 br space. of course there are the facilities and amenities (how often will one use) and "prestige" (which can't feed me).

 

[Forever84]

How about slightly older resale unit? There are some which aren't bad.

 

[runforyourlife]

realistic enough that i'm not looking for like for like. but just looking at space wise, giving up a 5 room space for a 2-3 br space. of course there are the facilities and amenities (how often will one use) and "prestige" (which can't feed me).

In that case, you’re prob well suited in your 5 room flat or other hdb 5 rooms lo if all you need is the ‘room space’.