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Singapore Private Property prices still up or down? Part III


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https://www.99.co/blog/singapore/sale-of-older-hdb-flats-up-40-from-last-year/

Sale of Older HDB Flats Up 40% From Last Year

 

More Older Flat Sold in Q2 2019

 

According to the Business Times, 564 flats that are aged 40 years or above were sold between May to June this year. This is 40 per cent higher than the same time last year (403 transactions). There was also a 10.4 per cent increase in transactions for resale flats between 30 to 40 years old, with 1,219 units changing hands.

 

To put things in context, this wasn’t just an isolated rush for older flats. The volume of resale transactions also spiked almost 30 per cent between Q1 and Q2 of this year (6,726 transactions). The volume of older flats – 40 years or above – account for only about eight per cent of the transactions.

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https://blog.moneysmart.sg/property/hdb-homeowners-resale-first-property/

My Resale Flat Journey: First Property is a 30-Year Old Resale Flat

 

About The Flat

 

Location Jurong West

Flat Price $335,000 (after $40,000 housing grants)

Year of Purchase 2018

Flat Type & Size 5-room flat/ 121 sqm

Remaining Length of Lease 69 years (as of May 2019)

Monthly Mortgage Amount & Loan Tenure About $1,600 18 years

Renovation Cost About $35,000

 

MS: We understand that your flat is about 30 years old. Was its age a concern for you?

 

One reason why I bought a resale flat is that it is more spacious for my family. This flat is about 120 sqm and the kids have more space to run around. Sometimes my parents or my wife’s parents will visit. So it’s better to have more space.

 

We still have 69 years left on the lease which is good enough for us. Our children and future generations are likely to buy their own homes anyway, so we don’t need to worry about leaving this flat for them. As we are planning to use this flat as a home, I think it’s good enough. For the next generation, you don’t need to bother as the kids will buy their own homes.

 

Although this is an old estate, the area is well taken care of by the Town Council and HDB alao carries out upgrading of the flats.

 

 

MS: Do you see your flat as an investment?

 

When we were weighing the pros and cons of buying a 30-year-old flat compared to a newer one, we did think about this issue. However, we feel that a house is for the long-term and one that would see us through our old age. Instead of hoping to make a profit from moving houses, we would rather stay in one flat and finish paying our housing loan sooner, so that we can free up our finances for other things.

 

Edited by Mercs
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Turbocharged

MS: Do you see your flat as an investment?

 

When we were weighing the pros and cons of buying a 30-year-old flat compared to a newer one, we did think about this issue. However, we feel that a house is for the long-term and one that would see us through our old age. Instead of hoping to make a profit from moving houses, we would rather stay in one flat and finish paying our housing loan sooner, so that we can free up our finances for other things.

 

 

I know a lot of people have the same mentality as above. When they are in their  early 30s, they look at their current finances and think that if they want to enjoy a spacious flat, then they have to go for an old flat because that's what their affordability level is.

 

Problem is when pple reach their 40s, they would have grown their income and savings.  And human has tendency for greed in wealth. When they grow wealthier, they want even more money, and  it become painful when their biggest investment is either not making money or may even be depreciating.  They will not be thinking the same like when they were in their 30s.  To add fuel to fire, their friends in their 40s, may have already make some good profit in their property investment, but it is not working out for them. 

 

In my daily business, it become very clear to me that property investment, like anything else in life, is either you "suffer" first in the beginning and enjoy later in the future years or you take a comfortable path in the beginning and then you "suffer" later in the future years. There is simply no escape from this....whether it is career, marriage, education, investments, etc.....it is the same. 

Edited by Icedbs
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there are 7000 buyers in the market with a total of smelly smelly $20B ... buy buy buy ... MTL!

post-7984-0-07757100-1565208734_thumb.jpeg

Edited by Wt_know
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I know a lot of people have the same mentality as above. When they are in their early 30s, they look at their current finances and think that if they want to enjoy a spacious flat, then they have to go for an old flat because that's what their affordability level is.

 

Problem is when pple reach their 40s, they would have grown their income and savings. And human has tendency for greed in wealth. When they grow wealthier, they want even more money, and it become painful when their biggest investment is either not making money or may even be depreciating. They will not be thinking the same like when they were in their 30s. To add fuel to fire, their friends in their 40s, may have already make some good profit in their property investment, but it is not working out for them.

 

In my daily business, it become very clear to me that property investment, like anything else in life, is either you "suffer" first in the beginning and enjoy later in the future years or you take a comfortable path in the beginning and then you "suffer" later in the future years. There is simply no escape from this....whether it is career, marriage, education, investments, etc.....it is the same.

For some, the upbringing and culture makes them unwilling to view their home as investment.

 

Nothing wrong, especially if they are concerned about job stability and can use the current site for their work purposes.

 

They are also “guaranteed” of a new comparable site (unknown BTO pricing) 20 or 30 years down the road.

 

There are still some pros. Although I personally would stretch for a private, not everyone agrees.

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I know a lot of people have the same mentality as above. When they are in their early 30s, they look at their current finances and think that if they want to enjoy a spacious flat, then they have to go for an old flat because that's what their affordability level is.

 

Problem is when pple reach their 40s, they would have grown their income and savings. And human has tendency for greed in wealth. When they grow wealthier, they want even more money, and it become painful when their biggest investment is either not making money or may even be depreciating. They will not be thinking the same like when they were in their 30s. To add fuel to fire, their friends in their 40s, may have already make some good profit in their property investment, but it is not working out for them.

 

In my daily business, it become very clear to me that property investment, like anything else in life, is either you "suffer" first in the beginning and enjoy later in the future years or you take a comfortable path in the beginning and then you "suffer" later in the future years. There is simply no escape from this....whether it is career, marriage, education, investments, etc.....it is the same.

The other aspect of things is also happening in my circle. People in 30s chasing the elite lifestyle thinking their potential will keep increasing as they progress. When reach middle age, perspective of life change and grew out of chasing the high life. But since already committed and not so simple to just exit, what to do but to keep quiet and slog on.
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Hypersonic

I know a lot of people have the same mentality as above. When they are in their  early 30s, they look at their current finances and think that if they want to enjoy a spacious flat, then they have to go for an old flat because that's what their affordability level is.

 

Problem is when pple reach their 40s, they would have grown their income and savings.  And human has tendency for greed in wealth. When they grow wealthier, they want even more money, and  it become painful when their biggest investment is either not making money or may even be depreciating.  They will not be thinking the same like when they were in their 30s.  To add fuel to fire, their friends in their 40s, may have already make some good profit in their property investment, but it is not working out for them. 

 

In my daily business, it become very clear to me that property investment, like anything else in life, is either you "suffer" first in the beginning and enjoy later in the future years or you take a comfortable path in the beginning and then you "suffer" later in the future years. There is simply no escape from this....whether it is career, marriage, education, investments, etc.....it is the same. 

 

if i were a property agent, i would advise my clients to keep their home and property investments separate instead of "suffering".  a person should never be pressured into making investments as possibility of making mistake is high under such circumstance.

 

a fully paid up and comfortable albeit budget home for the family to build their lives gives one a peace of mind to undertake higher risk investments to build weath be it property, stocks, forex etc at his own pace.

 

the stability will also provide kids a good environment to develop and pursue their own dreams.

 

the upgrade game has gotten many families into trouble than necessary because not all will succeed given the risky nature

 

:D

Edited by Enye
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I have a friend who grew up in a modest environment

But she’s now used to servants, the good life etc. so much so that when we have gatherings there must be someone to fetch her over and there must be air conditioning

So when we eat hawker food, we eat it at a restaurant

Luckily the husband can support this lifestyle..

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this report say old hdb about 40yr age which is left 60yr tenure average transactions price at 330k

 

compare this to a brand new 5room bto which is price about 350k to 400k+ in ocr, would you want to save a meagre 50k to buy a resale 40yr old hdb?

 

if you compare to a resale of new unit just 5yr old, ie left 94yr. the resale is average 150k more than bto price

 

using the same example if a 5yr old 5room bought at ulu location at 350k from hdb in 2014 then resale at 500k today , from 94yr to 60yr is difference equal 500k - 330k =170k, ie 34yr difference is worth 170k, so per mth is $420, similar to the 69yr jurong west resale hdb example posted earlier

 

however this depreciation is true only for old hdb up to 40yr age

 

tiagong the older a lh99 gets, say above 60yr or 70yr, the depreciation may shoot up at a much sharper rate, but currently no past data to support such speculation

 

so now all waiting for the vers lifeline ð

Location matters bro

That’s something worth paying for

That’s one main factor to live in an older place

The savings is simply a bonus

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true lah, that's why old hdb in prime location no worry

but only afew selected prime locations

bulk of the hdbs not in prime locations

old hdb in ulu location keep depreciating

these owners worry leh, when will they receive the vers lifeline? or should they acknowledge that old hdb is keep depreciating to zero dollar in 99th year, and treat it as a rental house lo

Just curious. Are you living in a HDB?
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i personally know there is this 4S HDB near to Bishan centre, TOP was 1986 with $35k price and is closing at 545k now

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i personally know there is this 4S HDB near to Bishan centre, TOP was 1986 with $35k price and is closing at 545k now

 

Anything property bought in the 80s would have had some appreciation by now..  even the HDB leases

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This is absurd pricing.

I agree, but in a few months or years, this could be considered a bargain.. remember the AMK Hub? There was a 99 LH condo next to it, priced at 1000 psf, and many mocked the high price... now, 1000 psf can't even buy a place in Punggol...

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I agree, but in a few months or years, this could be considered a bargain.. remember the AMK Hub? There was a 99 LH condo next to it, priced at 1000 psf, and many mocked the high price... now, 1000 psf can't even buy a place in Punggol...

 

How true !   

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Turbocharged

if i were a property agent, i would advise my clients to keep their home and property investments separate instead of "suffering".  a person should never be pressured into making investments as possibility of making mistake is high under such circumstance.

 

 

 

Unfortunately, a lot of pple are not savvy in investment instruments. They know a bit about stocks, unit trust, REITs etc...but they don't have time to manage the portfolio themselves. As a result, most buy into unit trust or ILP where over time, the management fees erode their returns . Or they dwell into stocks, didn't monitor and then ended up with half of what they begin with. In the end, most average consumers conclude that either the fund managers are sneaky or other investments are simply too risky for them.

 

Hence the only viable investment most average pple have is their home. So my take is that if the home is your only possible investment, then please make it a sound one especially when one is still young. Like all investments, younger age is a big advantage because of the long investment horizon for compounding returns.  Work hard, take a bit more risk and don't settle for comfort when one is still young (early 30s). There is plenty of time for comfort and low risk investments when one is old.

 

This is not to say all young pple must stretch their budget for their home, but they can make sacrifices for sound property  investment principle. For example sacrifice space for better location. Or sacrifice space for a newer home where the chances of capital appreciation is higher. Property is the biggest investment for most pple, so whether they look at it as a roof over their head, or just a home to sleep at night, it is still their biggest spending so make it a sound one where it can grow over time.

Edited by Icedbs
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