No clients are identical. Their budget or the objective to achieve in every transaction is different. But most share something in common – ASPIRE TO OWN A 2nd PROPERTY FOR INVESTMENT (Qns: Must it be Singapore property?) With different measures in places such as Total Debt Servicing Ratio (TDSR), Additional Buyer Stamp Duty (ABSD) and Seller Stamp Duty (SSD), many people find it challenging to achieve their dream to own a 2nd property. Taking CPF accrued interest into consideration, many found out that it is IMPOSSIBLE to achieve their dream.
Case Study 1
Couple in their late 40s, who are professionals in their own arena owns a fully paid landed house they bought more than 20 years ago. Given the stability in their income and lifestyle, they are looking to invest in a 2nd property. They managed to purchase a 2nd property at $1million, however, they had to dip into their savings to pay the first 5% of the investment, and on top of that, they had to pay ABSD of 7%.
Case Study 2
Couple in their 30s, both earning a comfortable income and currently owns a partially paid up 4 room HDB flat. They were initially looking to upgrade to a private condominium but were concern that most of their sales proceeds from the HDB flat and savings will be used for the new condominium and they will be left with nothing for rainy day. After a few rounds of discussion, and understanding more about the couple, they agreed to purchase a condominium each (without incurring ABSD), one for own stay, one for rental income and still have some excess cash for rainy days.
Things to ponder…
Why is the first couple, who is more financially stable struggling to purchase a 2nd home, but the second couple made it look all too easy to achieve the dream? What made their situation so different?
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