Buying Tips

Advantages of buying versus renting Pros: Security - Owning a property to stay in provides protection, stability and assurance as it's not subject to rental fluctuations and lease terms set by the Landlords. Investment - Property in Singapore will appreciate over time due to limited land usage. Property can also be used to hedge high inflation where cost of living goes up with real income. Forced Savings - Repayments of mortgage loans are a type of forced savings strategy. It helps to instill proper money management and discipline through forced savings. Investment returns - Renovating a rented place is a sunk cost as the property will be returned to the Landlord when the lease ends. However, owning a property and renovating it would increase the value of the property and thus increases the investment returns. Succession Planning - Owning a property(Freehold) can be passed on to future generations as compared to renting a place and returning the property to the Landlord when the lease ends. Cons: Deposit / Downpayment - It takes time to accumulate deposit/downpayment to purchase a property thus it can take years of prudent spending and changing of lifestyle to save up on the deposit. High Costs - Owning a property can be more expensive than renting because of high maintenance fees, repairs of the property, house insurance and property tax etc. If the mortgage loan amount is high, the monthly repayment might be more than half of the income which might pose a huge financial strain on the owner. Price Depreciation -  Property market moves in cycles. Any investment will carry a certain amount of risks. Thus, if  there is a downturn in the market, the property value will depreciate. If the owner is unable to service the mortgage loan, the banks [...]

Plan Before You Buy Setting short term goals for long term targets. Plan for something that you can afford and make some compromises on the lifestyle  for a sound financial start. Setting a budget It is important to set a budget. Do an Approval-In-Principle (AIP) from banks to understand how much you can borrow before starting to look for a house. The loan amount will be limited by your income earning capacity, assets and existing debts, credit card limits, study loans and car loans etc. Set aside another sum of cash for mortgage/house insurance, stamp duty, legal fees, renovations and maintenance fees etc. Set aside 6 months of income for emergency.  Important to buy a home that you can comfortably afford to repay over the long term with the goal of being debt free in the shortest possible time. Focus on your preferred area Near to work place Near to parents house so that your parents can take care of the babies easily Near to public transportation (MRT, LRT and buses) Lifestyle Favourite District

After choosing your ideal home, it's important to get the correct mortgage for your property. By choosing the right mortgage loan, thousands of dollars can be saved over the long run. There are plenty of products from banks with different interests rates ,features and fees being offered to the public. Below are some ways to narrow down which loan is suitable for you. Purpose and requirements of the loan Consider the purpose of the loan. If you are a purchaser planning to stay in your property, you would require a home loan while investors would look more at a residential investment loan. Next step is to decide what type of loan would be best to suit your needs - Fixed or Variable rate ? Flexibility to pay off more than your scheduled payments or offset your mortgage against your income earnings monthly thus save on interest expense. Plan how long do you intend to repay the loan. Loan Features Understand the features of several loan products. Bearing in mind that many banks will also allow you to split your loan amount over more than one type of loan to meet your needs. Walk in to a few banks (OCBC, DBS, UOB, Standard Chartered, HSBC, etc) and talk to the mortgage bankers to find out more about the mortgage loans packages. Long term expenses Prioritize your preferred features in a loan and calculate the long term costs of the options that you have considered. Will you save more if you choose a Fixed over a Variable loan even though fixed interest rate is slightly higher? It all depends on how well disciplined you are with budgeting, family lifestyle and future plans. Plan well ahead in order to forecast as accurately [...]

Your Ideal Home It's useful to engage a professional real estate agent to do house hunting together as the agent has a wide network of database, information and knowledge. Make a list of your needs and wants in a house and study the property market in the areas that you prefer. During house viewing, bring along a notepad and write down everything that you "likes" and "dislikes" about the house. It's useful to prepare a checklist of criteria beforehand so that you can compare the properties that you have viewed. Things to consider : Investment perspective: What is the rental yield if you plan to rent out? Will it continue to increase in value based on surrounding development? Require high maintenance costs? Family's lifestyle: Easily accessible public transportation to and from work, parents' place and children schools? Any local amenities and eateries within walking distance or a short drive away? House with a view, any empty plot of land in front that might potentially block out the view in future development? Closely build houses, sufficient privacy away from your neighboring blocks? The aspect and block: Any West sun during the afternoon? Any preferred facing of the sun? North and North-East facing houses usually give better energy efficiency. Is the house situated on a high ground? Does the block faces noisy road, expressway or train tracks? Special features: Nice, unblock view? Designer Decoration of the house? Charming courtyard or unique design? A house that stands out in some way from the rest may give it the edge over other houses on offer and is likely to have better resell value if the feature is an integral part of the house. Renovations: Does the renovated house match your tastes or suit [...]

Attend Open Houses By attending open houses, buyers can understand the actual condition of homes in the market. Keep the handouts given at open houses and then monitor the property around the area. Do research on the sales prices around the area/neighbourhood. Find Home Sales Prices Look at website, newspaper advertisements to get a feel for the average asking prices of homes. However, usually the asking prices of homes are often inflated for negotiation on the prices. Main focus should be on the sales prices of similar homes that have been sold recently. Search for records around the area are available online or ask your real estate agent from his company database or research. Use the information to understand where the prices of  roperty is heading now, however don't make the mistake of  putting in an offer on the amount that the seller has paid for a property-- usually it doesn't work because no sellers would want to sell at the price he/she bought and the additional cost of interest on the mortgage that the seller has incurred . Buying a property/home is a forecast of future value. Valuation Report It's useful to have a valuation report before making an offer and also understand how different banks value the property on sale. Ensure the results are kept confidential and bear in mind that the opinions of different valuers often vary. Putting in a Low vs. High Offer Putting in a LOW offer would show insincerity of the purchase - "Testing water". This would put off the seller and would potentially create problems in future negotiations if the seller interprets the low offer as a personal insult. However, if the property is over-priced and the offer is the maximum you [...]

There are two ways when purchasing a property. Either by searching online/newspaper and arrange to view the properties on your own or engaging a real estate professional to do the sourcing/screening and accompany you for the viewings. The OWN approach (PROS) Saves time Less hassle The OWN approach (CONS) Do not know what important questions to ask or what to look out for/take note of (inexperienced buyers). Do not know the criteria when searching for investment properties versus properties for own accommodation. Do not have neutral feedback from an experienced real estate professional who will bring valuable opinions and thoughts to the purchase. Purchasing a home/property is very often an emotional decision. Thus, one could be influenced by the sales pitch and ended up buying something that is not suitable for stay or investment. Engaging a Professional Real Estate Agent Get a real estate professional to assist you in your search. He will help you to prevent most of the problems faced by the OWN approach method. Usually for private property, the buyer does not have to pay any commission to the real estate professional who is representing him unless the price of the property is low. Therefore, as a buyer, why not make full use of this value added services since it's free?