Upgrade to EC

[Soya]

my hdb is a POT of gold leh ... PM says one ... don't play play ... lol

but i don't feel i got 1 pot leh ... not even a tiny scoop ... how?

 

 

 

 

leaseback lor. maciam every month tio 4D liddat.

[Yaloryalor]

buy $300k, fully paid up at $425k (at least)

 

so, should use $300k or $425k to calculate the yield?

I think generally ppl calculate without include the interest. But I do agree interest is relatively big portion for few hundreds K over 10 over years.

[Kangadrool]

If use cpf, the interest will continue to accumulate even though loan has been fully settled?

 

I think generally ppl calculate without include the interest. But I do agree interest is relatively big portion for few hundreds K over 10 over years.

 

[Wt_know]

just login into cpf and see my statement > $$ used for property

whatever the sum is ... that sum earns interest every year until you pay back all the sum + accrued interest

it does not matter you fully settled or not

unless you mean you pay back all the sum + accrued interest back to cpf

 

If use cpf, the interest will continue to accumulate even though loan has been fully settled?

 

 

 

Edited August 20, 2014 by Wt_know

[Kangadrool]

Liddat I lugi liao 'cos I redeem my loan. LOL....

 

This looks simple but deceptively complicated leh.

 

just login into cpf and see my statement > $$ used for property

whatever the sum is ... that sum earns interest every year until you pay back all the sum + accrued interest

it does not matter you fully settled or not

unless you mean you pay back all the sum + accrued interest back to cpf

 

 

 

[Coltplussport]

buy $300k, fully paid up at $425k (at least)

 

so, should use $300k or $425k to calculate the yield?

 

 

Just use the monthly rental minus the monthly interest and divided by $300k. Then you get the yield.

[Wt_know]

you redeem your loan but you have not paid the "interest" that the lump sum you taken out from cpf that should earn interest every day if you "have not" use that lump sum. beside, your monthly contribution if have not been used to service loan, it should have earned interest too.

 

nothing to do with loan redemption

 

like i said ... must change the perception that why i pay interest to use "my money" to pay for "my property"

 

cpf money is a fund (by policy) ...

govt use govt pay interest into cpf ...

you use you pay interest into cpf ...

straight apple-to-apple comparison

as simple as that

 

Liddat I lugi liao 'cos I redeem my loan. LOL....

 

This looks simple but deceptively complicated leh.

 

 

 

Edited August 20, 2014 by Wt_know

[Soya]

like i said ... must change the perception that why i pay interest to use "my money" to pay for "my property"

 

cpf money is a fund (by policy) ...

govt use govt pay interest into cpf ...

you use you pay interest into cpf ...

straight apple-to-apple comparison

as simple as that

 

 

 

Ya. Esp now when loan interest is lower than CPF rate, best to leave the $$ inside. Ah gong will pay me 2.5% interest. If take out to use, i hv to pay myself 2.5% interest. I know who i rather earn the interest from......

[Mockngbrd]

Poor fella wanto upgrade to ec kenna soot up down left right

[Wt_know]

hahaha ... that's good what ... thorough debate fee of charge somemore

if only want to hear good thing ... easy what ... just pick up the phone and call property agent

 

Poor fella wanto upgrade to ec kenna soot up down left right

 

Edited August 20, 2014 by Wt_know

[nazerath]

Like that good, can get to learn people's experience. Agents dunno what to say......

[Enye]

Liddat I lugi liao 'cos I redeem my loan. LOL....

 

This looks simple but deceptively complicated leh.

 

 

 

don't worry about the accumulated interest lah

 

if you don't sell, when you turn 55, only the min sum is transferred to RA. the rest you can withdraw

 

if you sell, the full sum can be taken out again for your next property purchase

 

[Piyopico]

A bit pointless asking whether to buy EC or not whether discussing the point of doing it.

 

Nobody can predict the property market 10 years down the road. However TS's aim seem to be earning 500K from the EC.

Just do it if your risk appetite is good and you can afford the extra monthly loan. Calculated risk. Calculate your sums and see if the risks is worth it according to your risk profile.

 

If "upgrading" to EC is because of the upgrade in living, then this is open for debate. Of course EC nicer than HDB. The distance of this particular EC however is 5 bus stops away from the MRT. If your current HDB is a short walk away, then this is downgrade.

 

If the new EC is smaller in size than the HDB, this is also downgrade.

 

If you move to EC and have jiaklat neighbours. Then this is super downgrade. In my mind, good neighbours add 10% to my HDB value.

[TVT]

A bit pointless asking whether to buy EC or not whether discussing the point of doing it.

 

Nobody can predict the property market 10 years down the road. However TS's aim seem to be earning 500K from the EC.

Just do it if your risk appetite is good and you can afford the extra monthly loan. Calculated risk. Calculate your sums and see if the risks is worth it according to your risk profile.

 

If "upgrading" to EC is because of the upgrade in living, then this is open for debate. Of course EC nicer than HDB. The distance of this particular EC however is 5 bus stops away from the MRT. If your current HDB is a short walk away, then this is downgrade.

 

If the new EC is smaller in size than the HDB, this is also downgrade.

 

If you move to EC and have jiaklat neighbours. Then this is super downgrade. In my mind, good neighbours add 10% to my HDB value.

 

But stay in EC got swimming pool, gym, tennis court at your doorstep. And security too, so no ah long to bother you. That is an upgrade from HDB.

[Coltplussport]

 

 

Just use the monthly rental minus the monthly interest and divided by $300k. Then you get the yield.

 

Think I got it wrong. Yield should be annual rental divided by the purchase price. So if bought for $300k , with month rental of $2.5k, then the yield should be 10%. That's why I don't think that buying EC is a good idea because rental yield from hdb is good.

 

Should instead get a private condo, use the hdb rental to help cover installment. For don't know what reasons, why the government allow private properties owners to own Hdb flat.

[Joseph22]

Some quick and simple maths.

 

Assume you take up a loan of S$500,000 for 20 years to buy that EC.

 

Interests payment at the end of 10 years will be around S$100,000. I assume 3.5% interest ...... this is not exactly the most prudent.

 

Monthly payment to service loan about S$3000.

 

 

So after 10 years and you managed to sell at S$1.5M, you will earn about $400,000 after deducting interest. Maybe S$350,000 if factor in renovation etc.

 

Potential gain S$350,000. Monthly payment S$3000.

 

The gain attractive or not? Can tahan another S$3000 loan a month for next 10 years or not?

 

BIGGER QUESTION. When you sell for S$1.5M you cannot but HDB for 30 months. You gotto pay rent for somewhere to stay even if you intend to move back into resale HDB. Rental at S$2500 for 30 months means expense of S$75,000. So your net gain not even S$300,000.

 

If you intend to upgrade again, the price of another private property that is not EC type sure higher. Can afford?

 

Buy back HDB 5 room 13 years later........... also uncertain. That HDB you sold at S$500,000 may now be higher too.

 

 

BUT if staying in private very important to you .............. then what the heck. Just buy la. Nobody here can tell you for what will happen in 10 years time.

 

 

 

 

 

 

Cannot buy from HDB or take grant for 30 months right?? Buy Resales without subsidary still can right?

[Kusje]

Think I got it wrong. Yield should be annual rental divided by the purchase price. So if bought for $300k , with month rental of $2.5k, then the yield should be 10%. That's why I don't think that buying EC is a good idea because rental yield from hdb is good.

 

Should instead get a private condo, use the hdb rental to help cover installment. For don't know what reasons, why the government allow private properties owners to own Hdb flat.

 

Yield should be based on market price (i.e. the price you can get if you sell the flat).

 

Eg, If someone bought apple stock at 50$ and it is now 600$. Apple give 30$ dividend doesn't mean the yield is 60% right? You should count your 30$ dividend against the current stock price.

[Chucky2007]

Every time I told my wife.. See, those people so rich, their life must be unhappy bec they have to work so hard.

 

My wife reply" how u know they are unhappy? How u know they have to work harder than you? And now you are really so happy with this income? And u don't have to work hard now? And your life and income now is more secure now than them?

 

Then she shuts me up by... Be thankful but don't be sour grape.. Always assuming that there is a unhappy family for every rich family.. "

 

Which is damn true la.. I have my shares of rich clients who are so loaded n happy, and also many of them rich n unhappy.. But also a lot of not so happy average people n a lot of happy average people.