Views on 2nd property

[ytppdnoces81]

Hello all, is keeping existing hdb still worth? Waiting for Top of our 2nd ppty bout 1 to 2 years later. Still undecided
whether to keep existing hdb(fully paid) for rental. Based on current market of my area, the rental is about 2.2k. Paid about 200k of absd so in simple terms, it takes about 7.5 years to breakeven. And thats excluding property tax, income tax, etc.. Views and opinions greatly appreciated!

 

[CaptainSGP]

Hello all, is keeping existing hdb still worth? Waiting for Top of our 2nd ppty bout 1 to 2 years later. Still undecided
whether to keep existing hdb(fully paid) for rental. Based on current market of my area, the rental is about 2.2k. Paid about 200k of absd so in simple terms, it takes about 7.5 years to breakeven. And thats excluding property tax, income tax, etc.. Views and opinions greatly appreciated!

I think you would be better off selling your HDB & putting the money in a well managed REIT. Assuming u can get back the ABSD remission. Not investment advice.

 

[ytppdnoces81]

I think you would be better off selling your HDB & putting the money in a well managed REIT. Assuming u can get back the ABSD remission. Not investment advice.

already verified, if sell within 6 months upon TOP, absd can do remission. (Was like thinking long term after breakeven). However, Including all, i think actual breakeven may be like more than 10 years, say i take this 200k (so the interest lost) and put else where or rather repay the condo loan.

 

[CargoSQ]

If the rental is only 2k+ and takes more than 7 years maybe better to get absd back

 

[Lmao0101]

Fully paid HDB, just get rid of it. Not worth keeping given the ABSD

 

[dareaper]

Consider cost in renting out your 2nd property such as property tax, additional income tax, maintenance fees, interest fees payable on your loan (vs using proceeds from hdb sale to paydown loan amount), agent fees for renting the unit out, these will offset against your revenue (rental).

You can do the math and see how long it takes to offset your ABSD... during this period your yield is 0% on the down payment + principal payments against the loan, and can only bank on capital appreciation for your profit. If your 2nd property is only on 1 name, then can consider the sell-one-buy-two option later on to avoid ABSD...

 

[rlskyline]

I rather take back the 200k remission and invest the money. if invest well, can become 300 or 400k.

 

[NiShiZhu]

I always thought this is the most straight forward and sensible way of doing. Didn’t expect still got pple toying the idea of paying 17% absd by keeping hdb.
With such conviction and confidence in property, looks like property won’t die so easily in Singapore.

 

[tkdboi]

Hello all, is keeping existing hdb still worth? Waiting for Top of our 2nd ppty bout 1 to 2 years later. Still undecided
whether to keep existing hdb(fully paid) for rental. Based on current market of my area, the rental is about 2.2k. Paid about 200k of absd so in simple terms, it takes about 7.5 years to breakeven. And thats excluding property tax, income tax, etc.. Views and opinions greatly appreciated!

I was in a similar position but if u take the actual profit per month from rental (offset the mortgage and interest payments), it should take even longer say about 15 years just to earn back the ABSD.

hence I decided to just sell off the HDB


Read HWZ Forum Rules!

 

[SeafoodGuy]

Hello all, is keeping existing hdb still worth? Waiting for Top of our 2nd ppty bout 1 to 2 years later. Still undecided
whether to keep existing hdb(fully paid) for rental. Based on current market of my area, the rental is about 2.2k. Paid about 200k of absd so in simple terms, it takes about 7.5 years to breakeven. And thats excluding property tax, income tax, etc.. Views and opinions greatly appreciated!

I am curious, do you have a free place to stay after you sell off?

 

[ytppdnoces81]

Yup, did rough calculation, 10+ plus years.. Was thinking after breakeven.

 

[ytppdnoces81]

Same situation

 

[ytppdnoces81]

I am curious, do you have a free place to stay after you sell off?

Have, the new ppty that we bought

 

[ytppdnoces81]

I always thought this is the most straight forward and sensible way of doing. Didn’t expect still got pple toying the idea of paying 17% absd by keeping hdb.
With such conviction and confidence in property, looks like property won’t die so easily in Singapore.

Ours b4 CM. Just wanna hear views ma. Mai suan leh...

 

[wlcling]

I wud never ever consider paying an absd of $200k just to hold a $500k-$800k property (hdb)

It just doesnt feel right

 

[NiShiZhu]

Ours b4 CM. Just wanna hear views ma. Mai suan leh...

haha no Suan la. Just feel quite impressed by the conviction of buyers nowadays, who r willing to go the extra miles just to own 2 properties. Like that property price how to not spike?
Even paying 12% is totally not worth it.
To be honest, even if absd is just 7%, I also don’t believe worth paying. Afterall, it’s still a 6 figure tax paid to govt just to keep an existing hdb.
Must take so long to breakeven (through rental)? where got time

 

[bolster]

haha no Suan la. Just feel quite impressed by the conviction of buyers nowadays, who r willing to go the extra miles just to own 2 properties. Like that property price how to not spike?
Even paying 12% is totally not worth it.
To be honest, even if absd is just 7%, I also don’t believe worth paying. Afterall, it’s still a 6 figure tax paid to govt just to keep an existing hdb.
Must take so long to breakeven (through rental)? where got time

well, different perspective. If the seller selling 10% or more below market price, I guess still can tahan to pay with ABSD.

 

[sazanami]

do take into account inflation / discounting / opportunity cost. put in cpf is already 2.5% x 10 years.

your breakeven is even further. can u wait that long? think of other things like children education, whether u will be locked to this arragement for next 10 years.

 

[runforyourlife]

No one talking about hard truth here.

How stable is your and spouse job? Forever one? If forever then keep upgrading .

Else the answer is clear.

 

[NiShiZhu]

well, different perspective. If the seller selling 10% or more below market price, I guess still can tahan to pay with ABSD.

Seller’s market if got sellers selling below 10% or more below market price then it’s not called seller’s market already.
It’s called fire sales market.