To RENT or BUY?? (Condo)

[RoxyRider]

So property prices have sunk to a good low now, we are planning to move. Is it better to rent or buy now? With the economy and interest rates, no one can be sure if property prices would continue to drop. However renting would be paying money to the landlord, not a wise choice at all.

We plan to live somewhere in the East Coast area, and have looked at some properties. With the upcoming MRT plans, it sure would be a good investment. We might not be in Singapore for the long-long term, could possibly relocate to another country after 5 years. Would it be good to have an investment property to hold on to even if we are here for 5 years at least? It all depends in a few years where the job takes us to. But meantime, is renting or buying a better choice? Would our condo near a new MRT fetch a good price / get good rental rates in the coming future? Or would property prices keep falling and renting would be a preferred option? Thanks

[Barnsley]

So property prices have sunk to a good low now, we are planning to move. Is it better to rent or buy now? With the economy and interest rates, no one can be sure if property prices would continue to drop. However renting would be paying money to the landlord, not a wise choice at all.

We plan to live somewhere in the East Coast area, and have looked at some properties. With the upcoming MRT plans, it sure would be a good investment. We might not be in Singapore for the long-long term, could possibly relocate to another country after 5 years. Would it be good to have an investment property to hold on to even if we are here for 5 years at least? It all depends in a few years where the job takes us to. But meantime, is renting or buying a better choice? Would our condo near a new MRT fetch a good price / get good rental rates in the coming future? Or would property prices keep falling and renting would be a preferred option? Thanks

If you are only here for 5 years , can you not get better returns investing the cash you are going to put into the property elsewhere?

As for rental , who knows , if the Govt doesnt "create/buy" jobs that will employ foreigners to come and rent your property then you are stuffed!!

[okonu]

Do you have PR/ SC or not? If you don't then paying an extra 15% stamp duty is a big hurdle to overcome vs other investments

[RoxyRider]

I am a SC and my husband is a foreigner. But i assume when we buy a condo its under both our names. He's also American, i assume theres some form of treaty about the stamp duty we avoid paying.

[RoxyRider]

So property prices have sunk to a good low now, we are planning to move. Is it better to rent or buy now? With the economy and interest rates, no one can be sure if property prices would continue to drop. However renting would be paying money to the landlord, not a wise choice at all.

We plan to live somewhere in the East Coast area, and have looked at some properties. With the upcoming MRT plans, it sure would be a good investment. We might not be in Singapore for the long-long term, could possibly relocate to another country after 5 years. Would it be good to have an investment property to hold on to even if we are here for 5 years at least? It all depends in a few years where the job takes us to. But meantime, is renting or buying a better choice? Would our condo near a new MRT fetch a good price / get good rental rates in the coming future? Or would property prices keep falling and renting would be a preferred option? Thanks

If you are only here for 5 years , can you not get better returns investing the cash you are going to put into the property elsewhere?

As for rental , who knows , if the Govt doesnt "create/buy" jobs that will employ foreigners to come and rent your property then you are stuffed!!

Thanks for your reply, yes we have investment in stocks too. For many condos we have seen, the mortgage monthly cost about the same as monthly rental... I'm confused.

[PNGMK]

I would say that if you can get a good ENTRY price (buy price) then you will be ok over 5 years given you are an SC and you can avoid ABSD with your US partner.

By entry price I mean you need to bargain hunt for a good buy price (< $900 / ft) and mortgage (rates are moving up already). This means don't buy new, don't buy fancy, don't buy in the expensive districts (10,11) but the urban fringe area. This will take time - it took me two years to find a place at a good price but the good ENTRY price meant I am not worried about my exit price. There's nothing worse than buying a condo only to realize you are negative already. Also remember the RE market here is almost illiquid - it moves very slow and it can take years to sell a place if you have a price issue..

[PNGMK]

As for mortgage cost = rental that's purely a function of supply and demand. When demand > supply it's well above the mortgage cost for rent.

[American]

By entry price I mean you need to bargain hunt for a good buy price (< $900 / ft) and mortgage (rates are moving up already). This means don't buy new, don't buy fancy, don't buy in the expensive districts (10,11) but the urban fringe area...

Interesting observation on how illiquid the market. it does seem many owners are just not willing to part with their holdings at a significantly lower price even in a down market. I see this market as a buy and hold one at this point. I haven't been here long enough to see how it was a few years back - was there a higher turnover and was there any bidding wars during the boom times? I imagine the market could be in a completely different place 5-10 years from now.

I disagree about leaving district 10 and 11 altogether. These are areas which seem to move the fastest especially with foreign investors. Also you completely ignore District 9? I place in River Valley or Orchard surely has more demand than a place in say Yishun? My strategy is to look for good value in these specific districts in this down market.

Finally there seems to be a lot of incentives with the newer developments with deferred payment, discounts, etc. at the end of the day a property is a lot more than just an investment, there is the emotional aspect and many prefer living in a new, just TOP'ed building compared to an older one.

[PNGMK]

I couldn't be bothered listing the districts exactly but you got my point I think.

When the recessions hit and interest rates rise / rents drop and the run to the door starts prices DO drop substantially. 2004/2005 was the last one. There were people with properties bought in the high period in the late 90's who only just got back into positive territory in the last few years I believe.

Liquidity has become a more serious issue with the new MSA mortgage rules but was always an issue. The volume of transactions is tiny.

[sundaymorningstaple]

As the Orchard Road area is rapidly becoming a ghost town and shopping centres in some area of downtown are half utilized, the "downtown" is disappearing at the express design of the government. They are planning on making three or four "downtowns" with the next one in the Woodland/Admiralty area (where the American School is now located (formerly in the south). This will tend to eventually spread the 'prime' real estate around the whole island instead of concentrating in 9 & 10 where it's crowded, noisy, and the roads and traffic leave a lot to be desired. But I reckon it's going to take another 10 years for that to start impacting more than a recession will do.

[RoxyRider]

Thank you folks for all the insight! What about any condo right next to an upcoming mrt? Its forecasted anything beside a train station will go up 10 -15% eventually. Any truth to that?

[PNGMK]

It doesn't need to be right next to an MRT - in fact that can lead to congestion and noise (why the hell do Singaporean's like condos right next to Freeways?). I'm 15 mins walk from an MRT which is fine for most people.

[RoxyRider]

underground mrt

[PNGMK]

underground mrt

with exits to the surface for the sheeple.

[RoxyRider]

Thats fine, but just wondering does the value of the property in general go up near a train station? The one right above Jurong Point far out in Boon Lay - I'm surprised per sq feet its more expensive than some other popular districts!