Posts
Hi AK,
I chanced upon your blog recently while searching for landed property and found your blog very interesting.
I would like to have your opinion on my property search.
I am in my late 40s and owns 2 condos in the OCR with my wife.
One of the property is fully paid off and rented out. The other property where we live in, still have a loan of $800k for 20 years.
I am confidence of paying off the loan when I reach 55 because of the rental and we have a combine income of more than $20k per month.
We are considering selling off our 2 condos and purchasing a landed property. I did my sum and conclude that we still can have the similar loan of $800k if we purchase a landed home at $2.2 mil.
Now my Questions
1) Does it make economic sense to swap 2 condo for 1 landed if everything remain the same or similar? interest rate, loan tenure and amount etc.
2) Although with the landed, I will have no more rental income. But I will still be able to reduce the loan significant when I reach 55 with my CPF withdrawal.
3) Any pitfall that I need to consider seriously? Like is it realistic to have a $2.2mil landed?
Thanks in advance for any advice (professional or unprofessional) :-)
Best Regards
B
Hi B,
Welcome to my blog. :)
Financially, I believe that you are in a comfortable position now and buying that $2.2 million landed property doesn't seem like a demanding thing. It is affordable.
However, you did not mention how much you have in your emergency fund or what are your plans to help fund your retirement if you were to purchase the landed property.
Like you said, buying the landed property would mean giving up your rental income and it could also mean drawing upon your CPF money (which is really meant for retirement funding) to reduce the loan for the landed property at age 55.
I am just raising some pertinent questions and you don't have to tell me anything else if you don't feel comfortable to do so.
In closing, I just want to say that it is probably OK to up our consumption level if we have certainty we will avoid financial hardship later down the road.
Best wishes,
AK
Related posts:
1. Do I need a bigger home?
2. 2015 passive income all gone.
Bloggy Award