The rise of the public flat as an asset

[chialc88]

most money is made by buying directly from HDB (which our next gen would continue the best practices).

For resale, if you had managed to clear/clean up your CPF, then likely your purchase it many years ago should be ok to sell and make good profits.

Moving forward, price appreciation will still happen in high demand area (as usual).

And, you're right for most resales HDB, the writing is already on the wall...

Love Compassion


(credit: hdb.gov.sg)

[funman168]

SGP Property is one of the best investment that youngster shld get in.
This serves as a form of forced savings.
Nowadays too much temptation to overspend beyond one's means.
Peer pressure to spend n impress other is greatly magnify by social media

opmi,
Definitely. I am quite sure you benefited from this too.
(directly or indirectly)

For us, we had jumped over...
Now, it's just the next generation...
Whether they have the right attitude and mindset to be resilience...

Lets pray for them...

Love Compassion


A Life not Reflected is a Life not Worth Living.

Yes. Hope that the young (aka fresh meat) is wise enough NOT to play an overplayed strategy. They are the ones that dont have the savings or capital gains (not the parents') to buffer any mistakes.

[grubb]

Moving forward, price appreciation will still happen in high demand area (as usual).

I'm afraid that I have to disagree on this, especially for the old flats in Bedok, tpy and amk. I think we are more or less at the limit where price appreciation has defied lease depreciation. In 10 years, will a sensible buyer still pay >400k for a 50 yr lease HDB?

[pianist]

that why the govt should do away with the fixed 99 leasehold concept, brick & mortar is made to last a few centuries, skip the 99leasehold concept, and make it like those system in noridc countries - govt owns all houses/flats and once a buyer purchases a flat , it gives a perpetual rights for the buyer to stay in it perpetually until he sell it

btw there is largely no such freehold/999/99/60 leasehold concept in Sweden. property is built to last even after 99years.

[grubb]

Since the government has boldly declared HDB to be a nest egg, I will be very interested to find out how they intend to deal with the older flats.

The oldest flats right now have remaining lease of 60-70 years. Going forward the depreciation is expected to accelerate. For the resale buyer who cleans out his CPF, I think that not only will he not get a satisfactory return on his money, he is likely to lose a significant amount too. Retirement will be very tough.

Govt already has in place policy to ensure people dont outlive their property tenure for CPF mortgage payment. Especially the younger one. See calculator below.

http://www.cpf.gov.sg/cpf_info/Calculato...P_Calc.asp

In a few years time, older L99 condos will see lesser buyers using CPF due to this limit.

Hi opmi,

Thanks for providing the calculator. I didn't know this existed. However, this still does not address the problem of depreciation due to the lease. I don't see how older flats can continue to be a store of value (or even grow).

[funman168]

SERS n upgrading

Since the government has boldly declared HDB to be a nest egg, I will be very interested to find out how they intend to deal with the older flats.

The oldest flats right now have remaining lease of 60-70 years. Going forward the depreciation is expected to accelerate. For the resale buyer who cleans out his CPF, I think that not only will he not get a satisfactory return on his money, he is likely to lose a significant amount too. Retirement will be very tough.

Govt already has in place policy to ensure people dont outlive their property tenure for CPF mortgage payment. Especially the younger one. See calculator below.

http://www.cpf.gov.sg/cpf_info/Calculato...P_Calc.asp

In a few years time, older L99 condos will see lesser buyers using CPF due to this limit.

Hi opmi,

Thanks for providing the calculator. I didn't know this existed. However, this still does not address the problem of depreciation due to the lease. I don't see how older flats can continue to be a store of value (or even grow).

[corydorus]

It makes no sense for perpetual holding in land limited Singapore. We also need to constantly renew to optimize our lands, and challenge our young to be competitive. The current concept of 99 or even 75 is enough for lifetime use.

[opmi]

SERS n upgrading

Since the government has boldly declared HDB to be a nest egg, I will be very interested to find out how they intend to deal with the older flats.

The oldest flats right now have remaining lease of 60-70 years. Going forward the depreciation is expected to accelerate. For the resale buyer who cleans out his CPF, I think that not only will he not get a satisfactory return on his money, he is likely to lose a significant amount too. Retirement will be very tough.

Govt already has in place policy to ensure people dont outlive their property tenure for CPF mortgage payment. Especially the younger one. See calculator below.

http://www.cpf.gov.sg/cpf_info/Calculato...P_Calc.asp

In a few years time, older L99 condos will see lesser buyers using CPF due to this limit.

Hi opmi,

Thanks for providing the calculator. I didn't know this existed. However, this still does not address the problem of depreciation due to the lease. I don't see how older flats can continue to be a store of value (or even grow).

the limit is to minimize the damage. L99 lease not going to change. Govt cannot sell Freehold land. Heard that it is in the Constitution. But too lazy to verify.

[opmi]

It makes no sense for perpetual holding in land limited Singapore. We also need to constantly renew to optimize our lands, and challenge our young to be competitive. The current concept of 99 or even 75 is enough for lifetime use.

Why only the young need to be challenged? Middle age and old folks no need..hahaha...

A lot of middle aged folks failed to realise that they are at or over the threshold of career stagnation and corporate deadwood in the middle mgt. Thats something that is inevitable. As seen in the baby boomers in SG and USA. STILL they want to whack more properties with the assumption of continued job security.