PFF Panel 2
Seedly PFF 2019
Asked on 02 Mar 2019
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.
HDB - Resale, or BTO?
A Resale flat makes less financial sense, especially older ones,
because it is generally more expensive
because it may already start to depreciate
you're absolutely right, it will be returned back to the government
However, if you are looking to at least make a profit from staying in a HDB flat, a BTO would make more financial sense because of the potential capital appreciation after 5 years MOP period. Owners in Buangkok Vale easily make over 100K in profits, for example.
Of course, at the end of the day, it makes sense to upgrade to a condo because of land ownership rights, which in turn lead to possible en bloc in future. In this case, you are not returning the land to developers, but selling it to them. And as seen for the past 2 years, sellers aim to reap high profits.
With that being said, if a condo does not go en bloc (which has not really happened before), it will also go back to the government after the end of its lease, just like a HDB.
Yes definitely you should buy HDB! U can use it as an investment. Imagine you purchase the house for around maybe $170-$290k After 5 years, you can sell it off for around $350-$550 depending on the number of rooms you bought and the renovations done.
Property in Singapore is forever a liabilities I agree but at the same time a good investment.
I would like to know as well! I bought a private freehold property as my first property investment, because I had no plans of getting married then and as such couldn't avail any subsidies in any case!
Back in the old days, buying HDB as your first home (for 1st time buyer) is definitely a good choice. But now, this is not the way anymore. If you are young and with strong monthly income, buying pte property will be a better choice for you.
Treat HDB as a long term rental to live in instead of an investment. It is good for new buyer due to various subsidies. Singapore have limited lands after all.