Right time to commit to a property now?

[5wd]

Re: Right time to commit to a property now?

hey Bro,

hello.
i can't find any thread close enough to my topic so i will use this post for my quick question:

what are the potential pitfalls of buying a small condo development (< 20 units) ?
it's already completed and lived-in and freehold.
intending to buy for own-stay. just worried about mid/long-term pains...

thanks in advance for all inputs.

cheers
a

everyone tries to time the market but then when is really the right time? buy or commit if you can afford it. If this is your only property doesn't matter if it appreciates or not, u won't sell either way if u gotta stay in.

 

[golfgti]

Re: Right time to commit to a property now?

hey Bro,

hello.
i can't find any thread close enough to my topic so i will use this post for my quick question:

what are the potential pitfalls of buying a small condo development (< 20 units) ?
it's already completed and lived-in and freehold.
intending to buy for own-stay. just worried about mid/long-term pains...

thanks in advance for all inputs.

cheers
a

Main problem is higher maintenance cost compared to bigger condos. Also when rental, will get lower rent compares to full facility condo

 

[5wd]

Re: Right time to commit to a property now?

oh ya, i wasn't mindful of the lower rental bit.
small project, not full condo facilities this one. but for own stay, rental potential not gonna be the main concern.
more worried about track-record of developer/builder i.e. quality of materials used to last the mid/long-term.
else for sure in the future sinking fund will increase as building ages.

actually monthly maintenance fees nowadays also not any lower for mass-market type condos.
lately the new projects all quoting $300 and up.

there are exceptions e.g. Clover by the Park at < $300 i believe.

anyhow, thanks for quick heads-up. i'll go research more.

cheers
a

Main problem is higher maintenance cost compared to bigger condos. Also when rental, will get lower rent compares to full facility condo

 

[gfch14]

Re: Right time to commit to a property now?

oh ya, i wasn't mindful of the lower rental bit.
small project, not full condo facilities this one. but for own stay, rental potential not gonna be the main concern.
more worried about track-record of developer/builder i.e. quality of materials used to last the mid/long-term.
else for sure in the future sinking fund will increase as building ages.

actually monthly maintenance fees nowadays also not any lower for mass-market type condos.
lately the new projects all quoting $300 and up.

there are exceptions e.g. Clover by the Park at < $300 i believe.

anyhow, thanks for quick heads-up. i'll go research more.

cheers
a

Doesnt matter if rental yield is lower given you are occupying it. Main challenge I sense will be with smaller unit projects, when you choose to sell, the transaction records r few if not any, hence pricing the property may become alil tougher I feel. All said,buy what you can afford.. My opinion - Every property here inSgp will somehow see upsides, one way or another..

 

[5wd]

Re: Right time to commit to a property now?

word.
another good point re: reference transacted prices...

i suppose if the future neighbours aren't selling then the next point of reference would be nearby comparable properties.
better-still, wait for a nearby 99-leasehold project to launch at skyhigh price to help lift the valuation.

unfortunately, everyone is somehow angling for the next big sucker-fish to come along and take the bait.

but $9xx psf for city-fringe (well, make that fringe of the city-fringe!), FH, still can stomach. as long as i keep the loan to < 75 %
somehow, i have yet to come across a "to-die-for" unit that i am willing to cough out a premium yet. still in the search.

well, thanks for your input.
keep it coming guys!

Doesnt matter if rental yield is lower given you are occupying it. Main challenge I sense will be with smaller unit projects, when you choose to sell, the transaction records r few if not any, hence pricing the property may become alil tougher I feel. All said,buy what you can afford.. My opinion - Every property here inSgp will somehow see upsides, one way or another..

 

[wobbles]

Re: Right time to commit to a property now?

Sometimes, living in a small development can have it's benefits too - fewer dissenting voices come enbloc time being one possible benefit

But, if it's for own stay, I reckon any buy is a good buy as long as:

(a) you (and other half if applicable) like it
(b) the sums fit and you can afford it
(c) it isn't in the fcuking middle of a landfill or right next to a huge septic treatment plant or has a transformer/power generator plonked right next to it
(d) you're not being suckered into paying above and beyond present market price (check caveats lodged)
(e) has covered parking (this last bit is important to me personally - I hate bird shit on my cars!)

 

[5wd]

Re: Right time to commit to a property now?

a) checked, well almost. need to pass the MIL test who will be staying with us.

b) checked, i reckon it's gonna be a +/- 100k negotiation off the asking price and eventually settling at +/- 50k

c) er... the transformer thing is further down the road next to some other condo! i dunno where the cesspool may be though. how to know man?
masterplan 2008 tells me its currently next to the zoned landed housing area.
i am wondering why this particular plot with say two 5-storey developments and maybe 2 rows of terraced hse isn't zoned in as well.
only good thing is plot ratio at 1.4 limits the immediate surrounding to 5 storeys. possible to get a valley view of them bung-a-lohs in the horizon for a long long time unless next-door terraces gets enbloc'd and goes highrise.

d) lets be real, i dun mind the seller making a nice profit in present day but will not want to be the robert on the chopping board lar. 25% - 33% profit in the pocket for the seller (he says he first owner, any way for me to check?) is about right, i think. much depends on seller's attitude and of course agent's attitude. we are not in a hurry to buy but by far this one ranks high.

e) not too critical for us as long as not like big condos need to walk a mile to some multi-storey block to get car. but yeh, it's covered, but at ground level so a heavy downpour with number-9 type wind will still get things wet.

anyhow, so good so far. more + than - from what i gathered.
and if the market does come down AFTER the purchase (which happens alot to me whenever i buy stuff), i will get leveraged and grab that D14 FH on the cheap and rent out to ktv sweeties!

well, lets see how the cookie crumble.

thanks for feedback bro.
i always enjoyed reading your posts.

cheers
a

Sometimes, living in a small development can have it's benefits too - fewer dissenting voices come enbloc time being one possible benefit

But, if it's for own stay, I reckon any buy is a good buy as long as:

(a) you (and other half if applicable) like it
(b) the sums fit and you can afford it
(c) it isn't in the fcuking middle of a landfill or right next to a huge septic treatment plant or has a transformer/power generator plonked right next to it
(d) you're not being suckered into paying above and beyond present market price (check caveats lodged)
(e) has covered parking (this last bit is important to me personally - I hate bird shit on my cars!)

 

[wobbles]

Re: Right time to commit to a property now?

a) checked, well almost. need to pass the MIL test who will be staying with us.

WOW. Bro, you are a man with testicles of TITANIUM

MIL staying with you... I gotta do the worship thing again:

The last time MIL planted herself like an acorn tree at our house (and that was only for a fortnight) I felt like rearing termites... hehehehe, OK, so I jest. But you're still a braver man than I!

Good luck on the house hunting decision - and keep us posted!

 

[5wd]

Re: Right time to commit to a property now?

dude,

it's not impossible lar.
helps if my folks and my MIL (who is alone) got on well and most definitely meet up more often than the average inlaws in this country.

our friends had expressed disbelieve when we mentioned the inlaws (including siblings' inlaws) get together outside of the usual muah gek and wedding do's.

so, i am having it alot easier than some of the bros on this island. for that, i considered myself a lucky basturd!

i must have been naughty in my previous life and maybe just a little bit still in this, so take it as my karma or character-building if you put a +spin on things. anyhow, them parents did alot for their kids. it's only right to maintain the kinship. if you don't who else would? not my politicians for sure (uh-oh, govt IB sedi~~~~~a!).

i am not getting any younger, so some things cannot wait.
within this couple of years, things have got to start moving more faster-er.

for now, i gotta dekit and scrap car (there's a WTS post somewhere out there : P) then i gotta go buy a home
then i gotta try to fire my boss/company (er... maybe that's too extreme, but i like to take a sabbatical).

i just need a trigger event. passed the stage for the normal mid-life crisis which i never really had. maybe it's delayed. haha.

methinks this house thing is gonna be the trigger for things to come. i pray it's not gonna be an expensive life's lesson.
wish me lucky bro.

meantime, i'll hang ard here more.
i like it that opinions are wide and varied. helps me cover some blind spots.

thanks again my man.

cheers
a

WOW. Bro, you are a man with testicles of TITANIUM

MIL staying with you... I gotta do the worship thing again:

The last time MIL planted herself like an acorn tree at our house (and that was only for a fortnight) I felt like rearing termites... hehehehe, OK, so I jest. But you're still a braver man than I!

Good luck on the house hunting decision - and keep us posted!

 

[Zack45]

Re: Right time to commit to a property now?

You can do a transfer of property.Which involves land registry only and only pay a legal bill, though consent of your lender is normally sought and free. Though you remain legally responsible for the mortgage and its payments....

 

[5wd]

Re: Right time to commit to a property now?

okays.
updates...

we paid for the option to purchase a property, finally after numerous viewings and huddling to crunch numbers and all.

still, city-fringe's fringe.
fh, completed

 

[epong]

Re: Right time to commit to a property now?

i'm just trying to find some ways to partially hedge the impact of runaway sibor.
any ideas how to
a

Why would sibor run away? As per funding rates, there could be a few reasons for higher costs of funding in the interbank market. 1. Crisis resulting in the reluctance for bank to lend eg during Lehman. How would bluechip chips react? In a bear market like crisis, most things go south.

How else for rates to go up? Inflationary pressure where there is a demand to chase hard assets. Monetary policy influencing rates to go up results on higher lending rates. And in this case, your property actually is THE hedge.

There could also be policy risks which unfortunately Singapore ranks high as one. There could be government policies pushing rates to go up ie force a minimum floor for lending rates on property.

Would you like to enter in a interest rate swap where you can pay fixed to receive floating to hedge the runaway risks? That's assuming you have access to this market (BMW-sg guys are usually quite huat).

 

[5wd]

Re: Right time to commit to a property now?

Why would sibor run away? As per funding rates, there could be a few reasons for higher costs of funding in the interbank market. 1. Crisis resulting in the reluctance for bank to lend eg during Lehman. How would bluechip chips react? In a bear market like crisis, most things go south.

How else for rates to go up? Inflationary pressure where there is a demand to chase hard assets. Monetary policy influencing rates to go up results on higher lending rates. And in this case, your property actually is THE hedge.

There could also be policy risks which unfortunately Singapore ranks high as one. There could be government policies pushing rates to go up ie force a minimum floor for lending rates on property.

Would you like to enter in a interest rate swap where you can pay fixed to receive floating to hedge the runaway risks? That's assuming you have access to this market (BMW-sg guys are usually quite huat).

hmmm. so i guess if credit market tightens up suddenly due to some black swan thingy, i'm gotten by the balls with sibor-pegged loan rates, for the lock-in period at least (and possibly any re-pricing thereafter).

that means i'll risk losing my job, losing car and losing my pet goldfish as well.
ah, the financial meltdown trigger i was waiting for to grab that d14 condo on the cheap for rental to working girls!
but then, such dilemma, again...

jokes aside, i was thinking more likely is for lending rates to climb once the feds and whatnot actually starts allowing the rates to increase. not in the very near-term but eventually right. No ?

and the property in question can't be seen as the hedge as it is for own-stay and not likely to be offloaded if we can help it.

upping the stakes on local bluechip banks sort of covers off the mas policy changes unless the entire property market is so screwed up that an artificially low cap is placed on maximum ceiling rates instead. not likely right...

as for i.r. swaps, nah, i'm just retail uncle investor... but i'll like to know whats the most affordable way to get direct access to participate in japanese equities though.
any lobang ? : P


anyhow, thanks for your inputs epong.
i'll ponder.


cheers
a

 

[Red_Bean_Bun]

Re: Right time to commit to a property now?

MAS don't have a policy on lending rates including domestic husing rates or to address inflationary pressure.

I will be watching the job reports in the US as once it hits threshold - there will be upward adjustments in the fed rates to address other pressures.

Why would sibor run away? As per funding rates, there could be a few reasons for higher costs of funding in the interbank market. 1. Crisis resulting in the reluctance for bank to lend eg during Lehman. How would bluechip chips react? In a bear market like crisis, most things go south.

How else for rates to go up? Inflationary pressure where there is a demand to chase hard assets. Monetary policy influencing rates to go up results on higher lending rates. And in this case, your property actually is THE hedge.

There could also be policy risks which unfortunately Singapore ranks high as one. There could be government policies pushing rates to go up ie force a minimum floor for lending rates on property.

Would you like to enter in a interest rate swap where you can pay fixed to receive floating to hedge the runaway risks? That's assuming you have access to this market (BMW-sg guys are usually quite huat).

 

[golfgti]

Re: Right time to commit to a property now?

posted this awhile back...

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