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Jim Tay

Jim is a real estate professional focused on advisory and consumer empowerment. Creator of the Property Upgrading Blueprint.

Jim Tay

Director at Jimtay.com

About

Jim is a real estate professional focused on advisory and consumer empowerment. Creator of the Property Upgrading Blueprint.

Credentials

Director at Jimtay.com

Jim Tay

Director at Jimtay.com

  • Answers (10)
  • Questions (0)
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Property

CPF

Loans

If I contribute more in both AD-HOC CPF and cash payments to the HDB loan, do I get back the same share I contributed when I sell my flat, or is it based on the 50-50 ownership with my spouse?
Jim Tay
Jim Tay, Director at Jimtay.com
Level 3. Wonderkid
Updated on 07 Jun 2019
Hey! When you sell your flat the amount of CPF you need to return is based on the amount used + accrued interest in each of your respective accounts. For cash payments, best to work out an internal arrangement between you and your spouse on how to split the proceeds depending on contribution or something :)
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PFF Panel 1

Seedly PFF 2019

CPF

Would you recommend to delay HDB loan payback (30 yrs vs. 20 yrs), so that the money in CPF OA can have a longer time to compound?
Jim Tay
Jim Tay, Director at Jimtay.com
Level 3. Wonderkid
Answered on 05 Mar 2019
If you are using CPF to pay off your loan, then it's a big NO! Because you are also compounding the amount of CPF you need to return to your account when you sell your flat in future.
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PFF Panel 1

CPF

Seedly PFF 2019

With all the talks about CPF and it's compounding interest, am I right to forgo the possibility of a BTO in a mature estate and buy a BTO in a non mature estate to maximise my grant and reduce OA usage?
Jim Tay
Jim Tay
Level 3. Wonderkid
Answered on 05 Mar 2019
It's a complex question with no straightforward answer. The upsides of having a house in a mature estate is possibly much more than the costs of the additional CPF interest. I would advise to most importantly not overstretch your finances especially for a first home. Upgrade later as necessary.
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PFF Panel 1

Seedly PFF 2019

CPF

Loans

Property

Savings Accounts

If I were to have cash on hand ($30k) and cpf-oa @ 2.5% ($30k) and am taking up a bank loan at 1.5%, would it be advisable for me to clear my housing loan or let the cpf remain in OA or invest in ?
Jim Tay
Jim Tay, Director at Jimtay.com
Level 3. Wonderkid
Answered on 05 Mar 2019
Your bank interest rate is still low. Leave your CPF in your OA, and take the cash to invest :) Using your CPF to pay off your bank loan is not advisable, unless you are really cash tight.
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PFF Panel 2

Property

Seedly PFF 2019

If BTO is not an option, and SBF/ROF is out of reach (failed multiple times), the only option left is resale flat. Is buying an old flat (above 40y) more viable or a relative new flat (Less than 10y)?
Jim Tay
Jim Tay, Director at Jimtay.com
Level 3. Wonderkid
Answered on 05 Mar 2019
Hey! When buying an older flat, I second Zuhdy that you have to be sure that you won't need to sell either to cash out for retirement, or to upgrade to a new one. Make sure that you don't outlive the remaining lease of your flat too! Reason is because a HDB flat with a short lease depreciates very fast and is going to be very difficult to resell again. A newer flat however, can still retain it's value well. I would recommend not overstretching yourself though, if it's your first property. Go smaller, and upgrade later when the need comes.
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Property

Loans

Should I use Cash of CPF fund for my housing loan partial prepayment?
Jim Tay
Jim Tay, Director at Jimtay.com
Level 3. Wonderkid
Answered on 05 Mar 2019
Considering that you have spare cash sitting around, best to use it to pay off your debts and reduce interest. And I second mic mic, that using it to pay off the CPF owed is better, as the cost of using your CPF is higher vs the bank loan interest rate, even at 2.4%. There's a separate working for that which is hard to explain here. For the topping back of CPF, the form is available on their website: https://www.cpf.gov.sg/Assets/members/Documents/FORM_HSDVR.pdf
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Investments

Property

Anyone here come across the recent industrial property investor, a girl 29 age own 34 property with high rental yield? anyone attended their course and really making profit here?
Jim Tay
Jim Tay, Director at Jimtay.com
Level 3. Wonderkid
Answered on 05 Mar 2019
Heard about them and went for their introductory seminar. Actually what they are doing is nothing new. It has been around for a while now, ever since the government first introduced ABSD as a cooling measure for residential properties in 2011. Never felt keen enough to sign up though, so I wont say much about the course per se, just that I feel that when it comes to industrial property, it is sunset, with high yields balanced by short leases on the property.
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Property

PFF Panel 2

Seedly PFF 2019

Should I use cash or CPT to service my housing loan if I'm confident of achieving >2.6% returns? (Assuming I take a HDB loan)?
Jim Tay
Jim Tay, Director at Jimtay.com
Level 3. Wonderkid
Answered on 05 Mar 2019
Putting it in the simplest terms, the cost of using your CPF funds is 2.5% per annum. (compounded, and ignoring the additional 1% on the first $20k) So, if you can make more than 2.5% compounded returns on your cash, then use your CPF for mortgage. Otherwise, use your cash.
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PFF Panel 3

Property

Seedly PFF 2019

What are the financial considerations to make in wanting to upgrade from a 4-room BTO to an EC/condo after 5 years. Approx how much savings does one need and the joint household income level. ?
Jim Tay
Jim Tay, Director at Jimtay.com
Level 3. Wonderkid
Answered on 05 Mar 2019
Hey! It's hard to advise for your question without understanding your specific financial position. However, when it comes to property affordability, consider the 3-3-5 rule and you will be very safe. 3 - Your monthly mortgage should not exceed 30% of your monthly income 3 - Your initial capital should be at least 30% of the purchase price 5 - Purchase price should not exceed 5 times of annual income I have created a property upgrading blueprint which would be useful for owners just like you who are getting started. If you'd like one, you can get it for FREE here.
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PFF Panel 2

Property

Seedly PFF 2019

Is buying HDB a good first choice for new buyer? At the end of the day we return the flat to the govt.. Makes no financial sense to me
Jim Tay
Jim Tay, Director at Jimtay.com
Level 3. Wonderkid
Answered on 05 Mar 2019
Hey! Whether a HDB is a good first choice for a new buyer is a question of affordability. You are right that at the end of the day you return it to the govt. However, because of the generally lower quantum compared to private properties, it is usually where first time buyers start their real estate asset journey. If you can afford a private property right away as a new buyer, why not? Less restrictions and greater investment potential. Cheers.
šŸ‘ 1
Level 3. Wonderkid
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