The majority of the population in Singapore lives in HDB flats. Many owners dream of owning and living in a condo or house instead, but think they cannot afford it. In some cases that is true, but in others it is not so – why not find out for yourself? There are two major reasons why you should consider upgrading:
- -Better lifestyle with more privacy and better facilities
- -HDB flats are meant for two generations only. Once they age they become a liability and losing value rapidly
Whether you can upgrade to a private property of course depends on your individual situation and financials, so please do not attempt to do this yourself. This page briefly highlights some of the different types of properties you can consider and compares them to each other. Schedule your no obligations, free consultation or attend our next event. Please do not try to use these strategies yourself though without the advise and guidance of a professional (see also: Disclaimer)
In this type of property more than 80% of the Singapore population reside in. The concept of HDB has been around even before Singapore became independent and HDB are celebrating their 60th anniversary this year. The HDB website says:
“Established on 1 February 1960 during our nation’s housing crisis, we were tasked with providing sanitary living conditions to replace the prevalent unhygienic slums and crowded squatter settlements. We delivered, and built 21,000 flats in less than 3 years. By 1965, within a decade of our formation, we had built 54,000 flats. Singapore’s public housing has housed an entire nation – today, more than 1 million flats have been completed in 23 towns and 3 estates across the island.”
While HDB or BTO (Built To Order, a more customized version of the standard HDB flats) are naturally the first choice of home for many people, there are also some downsides as well, especially as they age. HDB flats were originally meant for two generations only and are therefore a leasehold period of 99 years. As they age they become a liability rather than an asset and the price starts to decline and as they age, there are issues with CPF usage and eventually the banks won’t loan against it any more. At the end of the lease they will have to be returned to the state. This is the issue many owners are facing today.
So isn’t it time to consider whether and when to sell your HDB/BTO flat? Whether you can upgrade to a private property of course depends on your individual situation and financials, so please do not attempt to do this yourself. Else of course you can simply buy a newer HDB/BTO flat instead. Schedule your no obligations, free consultation to find out more and to do an affordability calculation for you.
Key Advantages: Affordability; Lot of supply; Potential subsidies/grants by the government
Key Disadvantages: 99 years leasehold; Restrictive policies (e.g. rental, re-sale levy etc.); No land ownership; Cannot buy for investment
Executive Condominiums (EC’s)
Executive Condominiums are somewhat a ‘hybrid’ between HDB and private property. When they are launched and built, they fall under the HDB policies, which means that there are certain eligibility restrictions and not everybody can receive a grant (depends on circumstances). After 5 years an EC owner can resell it to another eligible Singapore citizen or SC/PR couple and after 10 years it becomes a private property and can be resold to anybody including foreigners.
There is limited launches of ECs though (e.g. in 2019 there was only a single one). In terms of pricing they are somewhere in between HDB and Private Property prices (of course the price depends on many more factors like location, unit size and others, this is just a general guideline). Schedule your no obligations, free consultation to find out more and help you do an affordability calculation.
Key Advantages: Lifestyle with full facilities; After 10 years becomes private property; Potential subsidies/grants by the government
Key Disadvantages: 99 years leasehold; Restrictive policies (e.g. rental, re-sale levy etc.); Limited supply/locations; No land ownership
Many Singaporeans and PR’s aspire to own a private property. At the moment less than 20% of the population have fulfilled this dream – but perhaps you could be the next one? Many people don’t even know that they in fact could afford one (see also the Financial Strategies page).
Apart from a better status, private property enjoys many advantages, especially when it is Freehold (or 999 years leasehold), avoiding the scenario above and instead holding and increasing it’s value over time instead. As an owner of a freehold property you also own a (small) piece of Singapore as it comes with land ownership (full for landed, partial/shared for condo strata).
All this depends on your individual situation and financials, so please do not attempt to do this yourself. Schedule your no obligations, free consultation to find out more.
Key Advantages: Freehold or 999 years lease available; Wide selection of sizes, locations; Lifestyle with facilities (condo) or more privacy (landed); Land ownership; No restrictions for selling; Ability to do equity release
Key Disadvantages: Higher price; Potentially higher maintenance fee
New Launch or Resale?
When buying a private property (incl. some landed projects) you have the choice to either buy a newly launched project or a resale unit. Which one is better? The answer is simple: it depends. There is no absolute right or wrong. Both have their own set of advantages and disadvantages and it depends on how you weigh those for your own circumstances.
For resale property you can negotiate the price and will be ready to move in or rent out after a short period (of conveyancing) and you can see the actual product and it’s condition (esp. important if a bit older). Some of the down-sides could be that the capital appreciation expectations are not as high as for new launches, maybe the unit and/or facilities are worn out or you have to spend money for renovation, there are only selected/limited units available (for owners who wish to sell at this time) and you have to make the full payment.
For new launches you probably have a higher capital appreciation expectation and enjoy progressive payment over the construction period and beyond (up to CSC, approx 6-9 months after TOP). You have a choice of many units (at the launch) and once ready get a brand new property with new facilities at likely lower maintenance costs. However you have to wait longer until you can move in or rent out.
These are important considerations that we’ll be able to help you answer, specific to your own individual situation to make the right choice, so schedule your no obligations, free consultation now
Factors To Consider When Buying Property
A property purchase is a big ticket item, so you better get it right the first time. There are many factors to consider before making such a decision – but we are there to help. These factors include (but are not limited to) for example the property’s location, condition, developer, surroundings and more. If you consider an overseas property investment there are additional ones such as for example currency and political risks, the economy and infrastructure of the country, it’s property related laws and taxation, the local property market, financing costs to name but a few. So it is best you get help to make this easy for you.
Crucial is also to do a proper due diligence. This might include the title deed of the property, the seller/developer, condition, rentability (if for investment), sell-ability and so on. Lastly you need to ensure that it suits your investment objective and strategy and risk tolerance and to take action. Nobody makes money from ‘thinking about it’.
We all don’t have a crystal ball to exactly predict the future, but at least we can help you to make solid and sound decisions. Schedule your no obligations, free consultation to find out more.
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