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Upgrading from 4 room flat to executive condominium.

Saturday, April 29, 2017

Hi AK, I have been scouring your blog and other cpf articles but need your advice.

I currently have about 67k in my cpf OA (I refunded my OA with cash for my hdb installments which I previously paid using OA, thus considered cash payment for my hdb) And 63k in my SA (due to yearly top up).

I am turning 30 this year. I started using cash to continue paying for my hdb installments which is slightly less than $1k a month-4 room hdb.

My question is this. I am thinking of doing additional transfer from OA- SA to make it 100k in my SA. 

What is holding me back is that I plan to buy a executive condo in the next 5 years. Proceeds from my flat can cover more than the downpayment.

Can you talk to yourself to see what would you do?

AK talks to himself:
Eh. If you have enough cash, don't use your CPF-OA money to pay for new place.
If no choice, then, use the CPF-OA money. Don't transfer to SA.

I intend to keep a lump sum in OA worth at least 2 years of installments in case of emergency. I calculated if I continue paying cash for my hdb, by the time I get the condo, my OA will still be able to cover 2 years worth of installments.

The reader sounds like a prudent fellow.

Of course, we should remember that our home is a consumption item. If we could lower our cost of housing, we should probably give it some serious consideration.

Related posts:
1. Should I do CPF-OA to SA transfer?
2. Options for CPF-OA with flat on the way.
3. How to stop accrued interest from growing?


AK71 said...

Daryl Lee:
"we should remember that our home is a consumption item"
Not too sure if I agree with you on this.
If you own your house, most likely when you sell it down the road, you'll get back the cost of purchase and more. More like Free Stay. Whatever mortage installment you paid is like going into a FD that can only be withdraw when you sell.
If you don't, all rental you paid is gone forever..Down the drain.. kaput....

Raymond Ng:
Yes, I somewhat agree with you... I sold my condo and make 20% net profit (after deduct interest & legal cost) after staying for 10 years. 10yrs FOC rental, except maint fee.
However, we have to be mindful that our 99 lease hold property will become ZERO when expire. So, if your property is less than 30 years old, you may likely be "in the money".

Daryl Lee:
That's why gotta talk to the right person, or at least listen to the right person who talk to himself.  
Like stock portfolio, it's not buy and don't care. Gotta monitor and make adjustment from time to time.
Unless pitching tent at beach (don't think can do long term now), you'll still need a place to stay. Either you pay someone else, or pay youself to do that. Take a pick. :D

Raymond Ng:
"we should remember that our home is a consumption item"
This statement is also true because it guide us to spend within your mean and buy at low price.

"Unless pitching tent at beach (don't think can do long term now), you'll still need a place to stay. "
I never say don't own your own home wor...
Remember don't ask a barber if you need a haircut. ;)

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