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Asked on 11 Jan 2020

Buy HDB resale or condo?

For $800,00-$900,000, which would be more sound investment: a HDB resale or a condo? The goal is to stay in the apartment for a few years and then sell off.


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Hi anon,

Generally, private property would have a greater capacity to appreciate in price over time, but you are at risk of having to find an affordable and suitable property to stay in at the point of selling the current residence.

Also do consider that there is no guarantee that the value of the property will appreciate, so you might have to hold on if property prices enter a slump.

If you are comfortable with those risks, then I should think a condo would be better, although it won't be too big for a price of $800K.

Perhaps more seasoned property gurus could chime in.


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Lim Boon Tat
Lim Boon Tat, Mathematics at Cambridge University
Level 6. Master
Answered on 19 Jan 2020

With all the recent rules and extra stamp duties in place, i'm not sure if your strategy of buying a few years, and then selling off will work. Prices have dropped for some estates in the near term, and while you may save on the rental in the meantime, you incur buyers' duties and seller's duties, and these eat into your "returns".


👍 1
Mark Chan
Mark Chan, Business Manager at Amobee
Level 5. Genius
Answered on 12 Jan 2020

Hi Anon!

Generally, I would discourage anyone from having the mindset that the house that you live in is a form of investment for a number of reasons:

  1. It costs money to renovate the place you are moving into. (Unless you are thinking of living in it bare bones with minimal furniture etc)

  2. The interest payments for the housing loan (most people forget to account for this when calculating returns on property purchases)

  3. It costs money to move into the new place you are moving into (typically it would be an upgrade in terms of space)

  4. Property purchases normally come with a sizeable Government levy and taxes

  5. The most important point: Property prices, like any other free market, is dependent on the basic forces. Even if Supply were to grow at a normal rate, our population in Singapore is not growing at a fantastic rate. In addition, the supplementation of our population with non-locals has also slowed tremendously.

For these reasons, I would seriously urge you to reconsider thinking of your home as a form of investment. Instead, you can explore many other vehicles out there which may potentially give you better rates of return with lower hassle and risk ;)

Source: Google

Source: CNA​​​


👍 1
Teo See Hwa
Teo See Hwa, MArketing Associate at Propnex
Level 5. Genius
Answered on 19 Jan 2020

Depends on your income, age, family (children), parents.​​​


👍 0
Eileen Khoo
Level 3. Wonderkid
Answered on 17 Jan 2020

There are quite some factors to look at to gauge which would be a more sound investment; as in more directly, what are the key differences that you are looking at between HDB and a condo. We look at two aspects (investment point of view); the buying and the selling of the property.

When looking at below examples, it is assumed that all other factors are same for the sake of the comparison

1) Property Purchase price- the most important issue is whether the price of the property is accurately market priced. For example Getting a HDB for $800k would be a better investment if the other similar units around it are being last transacted at $1m and above if compared to a condo of $900k whose similar units have been transacted at $700k. Gauge the market price for the unit by looking enough similar units to form a more accurate average price estimate. Financial risks always look for similar scenarios for comparisons. Any Over priced investment may have lesser potential for higher returns.

Another one way to gauge the potential is to look at the rent of the property if available.

Another example could be the first time buyer hdb grants; if one qualifies for say $100k, that is a factor considering 5 years covers the minimum occupation period; and this should be carefully considered. The larger the amount of grant one qualifies for, the more advantages the HDB is seen as a 5 year investment vehicle. If for example one only qualifies for $30k then this makes the advantage less.

Cash in hand and total investment. The HDB allows for 90% loan to value while a condo require 75% ltv. This could mean a difference of $135k cash in hand or a capital fork out difference for a property of $900k.

Meaning a condo would require $225k down payment (capital) while a hdb $90.

If the sell off price is 5 years for the hdb makes a net profit of 100% from capital, $90k, the same percentage would require the condo to be sold at a profit of $225k. (Assuming the cash in hand for the hdb purchase more or less evens out the interest charges difference in the loan.). If one is purely looking at the nominal figure, then the condo in this instance would generate a higher nominal return.

2) Selling property price

Do take some time to look at the property’s selling off constraints and restrictions. For HDB there are probably more and these drive/keep the prices down compared to a typical condo as the demand is cut off from the total market.

a) Leasehold (HDB & Condo) vs Freehold (Condo); Any property that is approaching 60 years from the end of the leasehold tenure will look a far lesser “investment” vehicle compared to freehold. A condo with remaining leasehold of say 70 years would be deemed a riskier investment compared to a HDB of say remaining 90years. Most condos have no leasehold issues. Many HDBs have loan financing issues so the simple answer of condo being a better investment has to fulfil these specific conditions to be applicable.

b) Ethnicity quota restriction. SG/PR or Foreigner. The condo price would potentially be a better investment in most cases. However, there are many HDB units that could be comparable as to having enough demand to move it at a similar percentage in 5 years.

These are only comparisons being made for condos and hdbs assuming that the locations, amenities, Mrts, density, etc are the same. For example a $800k hdb is compared to a $800k to be a bear to each other as possible, location wise.


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