If you knew me well enough, you would know i have a keen interest in properties.
My personal goal right now is to own a property before i hit 30.
I guess it was my dad who jump started it.
He educated me quite a bit when i was growing up.
In fact, i would say he is a very knowledgeable man.
He seems to know just about everything!
Maybe not in detail, but good enough to impress.
Although i've set my aim for some time already...
I always thought it would be almost impossible to achieve given the conditions.
We cant buy any cheap government properties cause of our private house.
Im not going to get married and apply for a flat since im really quite gay.
The regulations only allows singles above the age of 35 to do so.
But my dad always remind and encourage me to dream about it.
Just like how he dreamt of owning a Mercedes, and having 3 daughters.
I wonder if he was humouring me about the daughters part though.
Looks like i will never know. o_o
Recently, my business-minded friend enlightened me a little bit.
Even if we were able to apply for a HDB or something, it wouldn't be that worth it as an investment.
Yes it's the cheapest right now, and their values increase rapidly as HDB owners try to play with the market right now.
But is it really worth it for investment?
The good ones are going for like 500k or more for maybe 4 rooms.
A private apartment can go for like 800k or so for probably 1 to 2 rooms.
Yup there's the room, space and price difference going against the private apartment.
Then again, if you look deeper...
You may need to wait for about 1 to 3 years for the HDB to be done since application is for new builts.
And you can't rent out HDB until 5 years later, that's a regulation.
So that sets you back for about 7 to 8 years in wait time till it can be truely considered as an investment.
To live in, yes.
To invest in, probably got to think twice.
Being a HDB owner also locks you up in a way cause you are not allowed to buy any other properties.
If you do, you would have to sell the current one.
It's a lot of trouble, and a lot of waiting time here and there.
Anyway, i've always been thinking how to go about the system and such to attain my goal.
Or how i need to work hard and move around for a long period of time to accumulate sufficient funds.
It sort of always brings me to a dead end.
And 35 years old, being 10 years later is a long time!
Who knows what would happen by then right?
Yet i have to be realistic and not jump into things in a risky manner.
Im not a risk taker to begin with anyway.
So now that all 3 of us have grown up and are self-sufficient, it feels like a lot of financial burden is lifted.
I got to really thank my parents for all their hard wok over the years.
For bringing all of us up with good values and not allowing us to waste our life away.
We could have been drop outs, gangsters, etc.
But here we are, all graduates with proper sufficient jobs.
My younger sis and i still owe my parents our school fees.
Which i am hoping to clear by next year.
I hope she clears fast too.
But aside to that, my family is financially quite comfortable.
We have a fully paid landed property which we live in.
The Merc which still has 3 years in it is fully paid a couple of months ago.
The only loan we have is the Honda Jazz which has 3 years in it.
Thats about 600plus in installment, quite manageable.
We have no other loans at all, which is one of the most important factor in my opinion!
There is a lump sum of money, not big but not too small, locked up in an account for rainy days.
Not going to touch it, cause it is for rainy days.
So there.
It suddenly seems to us that there is a space for us to create opportunities for ourselves. :)
We're still trying to figure it out.
But here's the plan we've thought of so far.
Given our current lifestyle and needs, we dont really need this house.
The house has 5 bedrooms and 7 whooping toilets.
There's 2 family areas which are not utilized at all.
A pond which only my dad fancies.
Fact is, we only really need 4 decent rooms, 1 decent living room, 1 decent dining area, 1 humble kitchen since we dont even cook at home anyway.
We dont mind sharing toilets and all of us except my dad doesnt want a pond.
We just need a simple house with all these which is simple and easy to maintain.
So right now we're thinking of selling this house and getting something smaller and simpler.
We're still looking for a private landed house at serangoon gardens or somewhere nearby.
It has got to be freehold.
Now this is so important, which many do not realise.
There is a huge difference in having a house which is freehold and having one which is 99 years.
Freehold means you own the property and the land which sits on it.
Nobody can take that away from you, ever.
99 years just mean that you are renting the property from the government for that period.
I know, we most likely wont live that long.
But if you talk business-wise, your property depreciates along with time.
You cant sell it at better prices than freehold.
And if you want to pass it on to your kids and such, what you pass onto them is going to be worth lesser and lesser as time passes.
Imagine this, i buy a 99 year lease landed property.
I live in it for say 10 to 20 years, pass it onto my kids with its remaining 79 to 89 years.
They live in it for 10 to 20 years, remain 60 odd years?
Even if you change hands here and there, the remaining years is going to be lesser and lesser each time.
People are going to cut your prices cause of the number of years left.
I wouldn't pay much for a 50 year remainder property cause hey, i'm not going to be able to sell it at a higher price when i want to move.
How much do you think it'll fetch when it reaches its last few remaining years of say 10 to 20 years?
And after all the 99 years, the government takes back the land without needing to give the current owner anything.
I never quite understood why people buy 99 years landed property to live in.
The price is no doubt, slightly cheaper than freehold.
But if you can afford a landed property at all, you definitely can afford a freehold.
Maybe it wouldnt be as nicely decorated, maybe it wouldnt be as new since new developments are 99 years now adays.
But really, think about it, is it worth it in the long run?
Don't get me wrong, HDBs are sort of 99 years if i didn't remember wrongly.
It's not the same though, cause it's a government property.
The government wouldn't allow it to reach its end of 99 years.
Either they'll buy it back from you or rebuild it, something like that.
HDB prices generally appreciates with time, even though the lease period decreases.
So the 99 years thing don't really apply there.
Anyway back to planning.
Values here are estimated and will differ depending on the market and events along the way.
But yeah, just plugging in some values for a general idea.
We are hoping to be able to sell our current house for say... 2.5 to 3 million.
And get a smaller simpler house to live in for about... 2 million.
If it works, we would have about 0.5 to 1 million to spare.
From there, we can scout and invest in an apartment or condominium.
Im still looking at freehold here, or a good 99 year one if we cant find a suitable freehold one.
Not too particular about the tenure since it is solely for investment purposes.
But still, preferably freehold at a good location.
Maybe a 2 bedroom one?
Im thinking below 1.3 million, and if its really worth it, maybe stretch to 1.5 million.
We would most likely need a bank loan unless we are so lucky that everything falls into place nicely.
The landed house would be fully paid, we dont really like risks so thats definite.
Having one fully paid place to live in gives us the assurance that if anything happens at least we still have the house.
We would dump whatever CPF we have into the condominium, plus the extras from the sale of our
current home.
Leaving CPF lying around is pretty much useless anyway.
Then the remainder of say less than 0.5 million we would get a bank loan.
Now here is the possible "playing" part.
Private housing loans are generally high in interest.
A "playing" method is to use the access big sum of cash of say 0.3 million or slightly more to open an account with a reputable bank.
This allows us to be Premium customers cause of the lump sum of cash.
One of the perks of being premium customers is that we can get bank loans at much lower interest rates.
So open the premium account, get the low interest loan, then dump the cash into the apartment.
The next step would be to direct all CPF contributions to repay the loan.
Apart from those already existing in our accounts, it would include monthly contributions since we are working.
That's like mum, elder sis, younger sis and i.
The apartment would also be immediately rented out.
I'm hoping that all our CPF contributions plus the rental profits would be sufficient to finance the loan's monthly installment and the apartment's monthly maintenance fee.
This would mean the apartment is self-financing, we don't have to fork out a single cent.
But if it doesn't, i don't mind each of us forking out a little bit of cash monthly too.
Of course, it has to be manageable and practical so a lot of initial calculations have to be done.
So yeah, that's basically the plan i have in mind.
It's a lot of small hurdles which we have to pass a little at a time.
The selling of our house, the buying of our new house, the excess cash to get premium membership at a bank, the buying of investment apartment, the dumping of all current CPF into the apartment, the loaning of remainder with premium interest rate, the cashing out of the account to minimize the loan, the directing of all monthly CPF contributions to the loan, the renting out of the apartment, the plus minus of additional cash needed to finance the loan installments and apartment monthly maintenance.
Once everything is in place... Its just the beginning.
If this works, which we will have to make it work somehow, we would give ourselves the opportunity for something bigger.
Depending on the amount and period of loan, once it is fully paid up or reasonably paid, we can look into something more.
I'm thinking probably 2 to 3 years?
We could use the apartment as collateral to buy another apartment and repeat almost the same feat.
Or we could sell the apartment and buy 2 reasonably priced ones, and repeat.
Something like that.
I'm hoping to achieve a property for each of us within 5 years.
Do i sound absurd?
Well, it's got to start somewhere right?
And if you think about it, there's really nothing much to lose, even if all else fails.
We still have a place to live in, we still have jobs, we still live like how most people are living.
I would rather push and take a step forward than to wait for something to happen.
Having the idea and plans mentioned above is already a step forward.
The next step, is to meet a property agent who has the knowledge and knows how to go about this.
We found one already.
My elder sis friend is a property agent who does property for our area.
I heard he's pretty good, being a director of his own team or something like that.
Plus knowing him personally seems to be more reliable than just getting a stranger.
He initially suggested us selling the house and getting 3 apartments one shot.
The investment progress, no doubt, would be much faster.
But we don't want to risk too much, so we prefer going at a slower pace.
He sort of have a rough idea of what we intend to do so he's drawing up a plan for us.
Our next step forward, would be at the end of this month when we meet up with him to see what he has in store for us.
And i'm really quite excited about it. :)
I am actually excited about this whole thing more than anything else thats going on.
For a period of time i was actually feeling that everything was starting to be monotonous and boring.
Felt like i was... Aimless.
I was just working, training, didn't seem like there was something i was really looking forward to.
But this! it's a different kind of feeling, i don't know why.
Maybe it's the thrill of trying to create something?
Maybe it's the uncertainty of whether it would succeed that fills me with anticipation, wondering if it's going to work?
It feels... nice.
