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Buy a private condo and wage slaves we become?

Monday, September 10, 2018

Over the years, quite a number of male readers have asked me if they should upgrade from HDB flats to private condos.

For some reason, it is always the wife's desire for an upgrade.

I wonder if the husbands were being honest with me.


I wonder also if there is some truth in the saying that it is easier to sell luxury goods to females than males?



Did some (female) readers throw shoes at me?


Wait, I see some branded ones.

Maybe, I can sell these later.

OK, yes, I know.

Bad AK! Bad AK!

Well, these readers should know that, easily, on a per square foot basis, a condo is going to cost 3x to 4x more than a HDB flat.

Just getting something that is the same size as their current HDB flat would be quite a big deal.

So, it is not surprising that many who upgraded from HDB flats ended up downsizing.

A home is probably the biggest purchase we will make in life especially with home prices being what they are in Singapore.

If we want to upgrade, be sure that we can pull it off comfortably and this should also be in the unfortunate event if we should lose our job (or if we cannot continue working for some reason).

That is the ultimate stress test.

We should also bear in mind any other financial objectives which we might have and how this upgrade in housing could impact our ability to meet those objectives.

Even if we can afford the upgrade, remember that it is not just about affordability.

In order to upgrade our housing, if we have to become wage slaves, the price, to me, is way too high.

Not overstretching will allow us to stay financially resilient in good and bad times.

Of course, if you are financially a "jin satki" (very capable) person, please ignore this blog.

Related posts:


Laurence said...

Make more women throw shoes at you. Better still, make them throw their Birkin and LV bags for good measure.
While you laugh all the way to your bank to deposit their donations. Lol.

AK71 said...

Jack James says...
Let’s not forget many also bought S$2 million condo , stayed and enjoyed for 10+ years and sold and walked away with S$4 millions price tag sold . Many such cases . Just make sure what product you are buying , and be the successful case .
I have read many such transactions . Of course , many also sold at loss . That’s why I repeat , be the successful one !

AK says...
Those who think that property prices will double in the next 10 years like it did in the last 10 years will probably be disappointed.
Anyway, the point of this blog post is not about investment, consumption or speculation which I addressed in an earlier blog.
It is about being financially prudent and staying financially resilient.

AK71 said...

Jack James says...
I do like the idea of staying in a place for 10-20 years and walk away with fat gain . No problem of choosing such place / location . Will it repeat the next 10-20 years ? Well , if the location is good ( defensive location ) , why not ? I am bullish . LOL .
For example : Clementi .

AK says...
If you have the financial muscle to take a punt, why not? ;)
Why you mention Clementi har? You stay there, right? :p

AK71 said...

Hi Laurence,

Yes, only the really branded ones, please. ;p

AK71 said...

Alan Yap says...
Not looking at double. How about just 50% e.g bought 1 mil and sell 1.5mil 10 years later? 😍😍😍

Jack James says...
Alan Yap , why not ?

AK says...
When we speculate, we must have the financial muscle to do so especially when it is a big ticket item like property.
There is nothing wrong with taking a punt if we know what we are doing. ;)

AK71 said...

Yeekee Hoo says...
I read that too and saw quite a few examples when owners bought during the crisis when prices are cheap.

AK says...
Crises are the best times to buy.
Be greedy when Mr. Market is fearful.
Beware of buying during market euphoria.

Yeekee Hoo says...
Yes agree.
That’s when ROI is the highest!

AK says...
I bought my first condo during SARS.
So, I know this to be true.
There is danger in being optimistic when everyone else is feeling optimistic.
Not a hint of fear in the air, that is when we should be fearful.

AK71 said...

Jack James says...
Let’s talk facts .
S$24 billion en-bloc owners will receive their payout really soon ( that’s en-bloc last year and this year ) , all these bloody rich owners will have to go back to Singapore real estate market again . Okay , you can say not all , can we say 80% ?
Singapore real estate market will be supported well , AT LEAST 2-3 years .

AK says...
Your optimism is a source of energy. Good on you! :D

Jack James says...
I talk facts . No speculation .

AK says...
When you make a guess, you are speculating.
"can we say 80%"
"AT LEAST 2-3 years."

Jack James says...
My facts are referring to S$24 billion and many more en bloc cash waiting to pour in . 😎
As in how much will pour in , how would anyone know ? Haha

AK says...
Which is why it is speculation ;)

Jack James says...
But a smart guess is 80% and at least support in 2-3 years . That’s a very smart guess , I shall say .

AK says...
A guess is a guess. :)

AK71 said...

Jack James says...
Why freehold or leasehold doesn’t matter . Told you already , you won’t stay in the old house forever and ever . Even this freehold built in head 1970 also asking for enbloc , so leave legacy to next generation , leave what ?
Doesn’t matter one la , so long the location is solid , title not so important . Both also can en bloc , both also can laugh all the way to the bank .

AK says...
Gong xi gong xi!
Just have to hope that 99 year leasehold condo you bought does not suffer the same fate like the one near Adam Road. Application for lease extension rejected and en-bloc failed.

Jack James says...
I will not wait until that moment . It will be sold by then in the market . I won’t keep it until that long. No way .

AK says...
Good strategy. ;)

AK71 said...

Reader says...
Why you so sarcastic? LOL

AK says...
Why you like that say? ;p
Sometimes, not saying something is better than saying something. :p

Ben said...

Hi AK,

I agree with you. That is why there is a phrase called "Silence Is Golden".


AK71 said...

Hi Ben,

Yes, one day, I will be silent. ;p

Unknown said...

Hi AK,

Sorry to comment on old blog post but this is latest property post I have found.
I am past 35 and not eligible to buy new HDB direct from govt (not married and income cap).
However, am looking for a place to live in.

1) If you were in such situation, with property as consumption item, would you advice resale HDB, private property or rental?

2) If purchase, with mortgage rate now near CPF OA rate, would you use CPF or cash to pay / service mortgage?

Thanks again for sharing your knowledge so freely!


AK71 said...

Hi NJ,

Read my blog on the Rule of 15 if you have not done so.

However, do not treat it as the Gospel truth.

The idea is to try to go for an option that you enjoy and yet is as low cost as possible since it is not an investment but consumption item.

Rule of 15.

As for using CPF or cash to pay for your home, things have changed but you might want to read this:

Use CPF or cash to pay for flat?

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