Apply HDB New Flat Income > $8,000, Can Appeal?

[watmekiasu]

I think for a couple, the major expense comes when they have a child. Think preschool fees, enrichment classes like music, swimming etc , social activities for kids like zoo, science centre, children’s theatre, family holidays etc.

[schellen]

And gahment still expects us to have many kids.

[winth]

titank:

So if a couple maximum combined income $8000, assuming each of them earn $4.000/mth. Say thier age is below 30 years old.


Can they really afford the $700,000 HDB flat said in Bukit Merah, Central, Queenstown area? Everyday have to makan instant noodles, no life no entertainment?

To tell you the truth, the people who have come with an offer for my flat are all middle-age (at least 38 and above) families with teenage children. I don't think they are earning only 8K combined income.

One newly wed came, liked my place, but said very upfront to me that my asking COV is too high and they cannot afford.

But hor, if it was during the early part of 09, this place is still reasonable. 4room here was going approx 500K.

[mrswongtuition]

qms:

titank:

$700K for Tanjong Pagar new flat? Combine income max $8,000 wonder how can they pay?

OK! Let's make some assumptions.

Assumptions:

1. Couple's total income = $8k
2. Price of flat = $700k
3. Couple's grant eligibility = $40k
4. Couple's CPF Ordinary Account (total) = $60k
5. Tenure of loan = 30 years
6. HDB Loan Rate of 2.6% will not change for the next 30 years

According to the financial calculator found in HDB website, the monthly instalment will be $2,471.00

Total CPF contribution per month (including employers' contribution) = $2,760.00.

The amount of cash payment/top-up per month will be dependent on the age group of the couple.

MONTHLY INSTALLMENT OF $2.5k!!!!!
Not many people can afford that with <$8k income!

I know my installment is less than $600/mth, no cash involved and we still do not have alot of entertainment/holidays. How do people survive if their installments are so high? If one day they both are jobless, how long can they last?

[titank]

insider:

I am a 'nomad'. Over the past about 20 years, I shifted to about 8 different houses. At any one time, I never give up my 'rights' to own a HDB flat since this is one of the 'benefits' I have as a taxpayer (not until my final dream house comes true, which is a two story penthouse in River Valley).


Over the buy and sell, estimated I have made more than half a million dollars. I got stuck with my first-hand HDB the longest for 5 years before I could sell. I sold when property market was at its peak and made a few hundred thousand dollars profit. Then I move to a rented apartment for about a year to wait for the property prices to come down before I moved in to buy another smaller one at a much lower price. In this way, my family moved in and out, out and in, and my kids are very used to house moving (they are actually expecting me to shift house on average every 2 to 3 years to have a new room / new environment). All at home, incl my maid, are 'trained packers' - give each some carton boxes and each will know how to pack / label / etc... (during house moving, each has to pack own stuff and I will not help except with my youngest son).

Maybe I am a 'gambler'. I am not so disturbed by those 20 years or 30 years loan coz I know I will shift when the 'lock-in' period of the bank loan is over or when I can find a HDB of a good price. When renting apartment, I will rent one of those units that I may buy, sort of 'trial stay' and if really comfortable, maybe can just buy a unit and stay or else will be 'next'...

I ever did my calculation. It is much profitable to invest in HDB than a condo. HDB is 'small $ makes big $' whereas condo is a bit like 'big money making small $' - % and not absolute value wise...

Insider,

Wow cool yeah where I believed you are the Pioneer where every shift house can earn $$$!!

Now HDB Flats still can shift & earn $$??
:?

[smurf]

MMM:

Assuming that the net cash is around $670, this is around 10% of their disposable income. I thot it seems pretty reasonable?

I don't agreed. there are many other cost involved too. stamp duty, agent fee, lawyer fee, renovation cost, interests, so its not only 700k. Interest rate is the hefty one. if loan is stretch over 25 yrs, one could be paying for a small HDB flat for nothing. :shock:

I dun think it's only just $670. currently, we are paying around $800 cash for a house which cost around 480k. imagine a 700k house??

also, I think CPF contribution are capped if your salary exceeds certain amount?

[qms]

smurf:

...there are many other cost involved too. stamp duty, agent fee, lawyer fee, renovation cost, interests, so its not only 700k. Interest rate is the hefty one.

Actually, the cost estimates above have already taken into consideration stamp duties, etc. Agent fee? There is no agent fee if you buy direct from HDB, right? Maybe I forgot to indicate this. The calculation was made assuming the couple bought the flat directly from HDB.

[jedamum]

smurf:

I dun think it's only just $670. currently, we are paying around $800 cash for a house which cost around 480k. imagine a 700k house??

also, I think CPF contribution are capped if your salary exceeds certain amount?

smurf,
$670 perhaps is for a longer loan period? or a smaller loan amount?

[winth]

Agreed with Insider!


HDB flat is govt’s way of giving money to the citizens. The yield of your first HDB property is usually the highest cos they give subsidized EVERYTHING.

We bought a more than 20 year old flat at a high premium. It was announced for SERs, my ILs made the loudest noise cos it was 45K COV for that run-down place. We did it up to our taste and enjoyed our 3 years there. After that, govt moved us to our current home and we bought it real cheap for a 5 room for this location, plus subsidized loan somemore.

Now, the value has doubled. Everyone was :!:. My current agent even asked how we get ourselves such a good deal. Problem is: nobody agreed with our decision then when we felt it was a good buy. It was on hindsight. So we made by going against the tide.

With the haywire property prices, we refused to buy, so we rented and held on to this current house.

Everything voices down to your first property and the bet you place on it.

The gamble is always there, but you need to take the courage to make that first step. Oh, have you guys read about someone who bought an Orchard property for 14mil, sold for 8 or 9 mil? That’s the losing part if bet on the wrong timing lar…

[qms]

smurf:

I dun think it's only just $670. currently, we are paying around $800 cash for a house which cost around 480k. imagine a 700k house??

Hi smurf!

$670 is just an estimate. The actual amount depends on the age group of the couple, because the age group determines how many percentage of the 34.5% CPF contribution goes towards Ordinary/Special/Medisave accounts.

Like what jedamum said, the final amount is also dependent on the loan amount and tenure. If I am not wrong, you are not taking up a 30-year loan, right?