Part 2 - Factors that a buyer will need to consider when purchasing a property

 

In Part 1 of this series, we listed some factors that will affect your affordability and needs serious consideration before you purchase a property. Part 2 will explore these factors in greater depth. The factors are:

 

  • Total Debt Servicing Ratio (TDSR)/Mortgage Servicing Ratio (MSR)
  • Buyer’s Stamp Duty and Additional Buyers Stamp Duty (ABSD)
  • CPF funds allowable for down payment, stamp duties and legal fees and cash reserves
  • Loan-To-Value (LTV) and Cash-Over-Valuation (COV)
  • Monthly mortgage repayment and loan tenure
  • Reserve fund for fluctuations in interest rates, loss of income, emergencies etc
  • Other miscellaneous expenses like property tax, maintenance/conservancy charges, fire and mortgage insurance, and renovation and repairs

 

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Part 1 - Factors that a buyer will need to consider when purchasing a property

 

In this article, we explore how much it takes to buy a HDB flat or a condo. What you can afford depends on your current income, debt obligations, expenses, savings and your loan eligibility amount. Here are several factors that you need to consider before taking on the purchase, which we will elaborate in Part 2:

 

  • Total Debt Servicing Ratio (TDSR)/Mortgage Servicing Ratio (MSR)
  • Buyer’s Stamp Duty and Additional Buyers Stamp Duty (ABSD)
  • CPF funds allowable for down payment, stamp duties and legal fees and cash reserves
  • Loan-To-Value (LTV) and Cash-Over-Valuation (COV)
  • Monthly mortgage repayment and loan tenure
  • Reserve fund for fluctuations in interest rates, loss of income, emergencies etc
  • Other miscellaneous expenses like property tax, maintenance/conservancy charges, fire and mortgage insurance, and renovation and repairs

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How can a Singaporean couple fund their 2nd and 3rd property?

 

Singaporean's first property is usually for home stay. Therefore, when we buy our first property, our consideration tends to be non-investment related as our main focus is to buy a home that we love to stay in rather than for its investment value. We may even buy a house above market value because investment value is the last thing on our mind at that stage of our life. Therefore, after putting money in that first property, how does a typical Singaporean couple fund their 2nd and 3rd property? If you are lucky and your first purchase meets that of an investment grade property (Good location, located in growth area, at or below market value etc), expanding your property portfolio would be an easier task. However, if your first property is located in a less ideal location with insufficient price increase potential, but you desire to increase your net worth by expanding your property portfolio, careful assessment and planning needs to be made.

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How Much Does It Cost to Buy a Condo in Singapore?

 

Many of us desire to own a private property, whether condominiums or landed housing. Before purchasing one, it is important to do your financials properly to make sure you have sufficient funds. If you are unsure, do approach an agent who can help you calculate.

In the illustration below, we assume that the buyer has zero property loans and is buying his first property with a 75% Loan To Value (LTV) loan tenure up to age 65. For other loan tenures, do check with our consultants HERE.

 

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What is the role of an agent when leasing a property?

 

There is often confusion about where an agent’s role ends when it comes to leasing out a property for a landlord or when serving a tenant. Sometimes, landlords are unhappy with their agents over a perceived lapse in duty. In this article, we clarify just exactly what falls under the duties of a real estate agent and what constitutes aftersales service.

 

SERVING LANDLORD

 

Under the Council for Estate Agencies (CEA), the official statement says:

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What is the payment timeline when buying resale property?

 

The process of buying a resale property is less complicated than a new launch property. You can read more about buying a new launch property HERE.

 

The following chart show the timeline after you have decided and put down a deposit for your new home:

 Resale Property Purchase Payment Timeline

 

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