Sunday, 11 January 2015

Will 2015 be the year you are waiting for?

It has been a while since I share my thoughts on real estate.

Recently I tried to repriced my loan as it has been more than 3 years and the "so called" best rate has reverted to the usual rate. The mortgage loan that I am pegged on is base rate plus SIBOR. 


As you can see in the article today, luckily I pegged it to SIBOR and not SOR. lol. But in any case, the SIBOR has also been creeping up steadily. I am not in a rush to convert to a fixed rate loan yet as my current terms are pretty flexible. 

I have to admit that I pay a pretty low interest rate on the house in which I am living in. 

In fact, I find it difficult to use CPF to pay down my loan quickly because CPF OA is paying me a much higher rate.  Logically I should be using cash to pay down my loan but I always believe it keeping some cash as "war chest" for investing or I can use those cash to trade or punt IPOs. 

Just to be clear, there are no lock in or penalty for early repayment to my home loan and 2/3 of the cash I deposit into the bank account will earn the same rate as the mortgage loan. So effectively, I am paying down the loan due to the interest offset features. 

Tip: find a loan package that suits you best. If you have no alternative use for the cash, then it is advisable to pay down the loan as quickly as you can and the bank must not penalize you for doing that. However, if you know how to invest or trade and wants to keep some cash for war chest, then the interest offset feature will suit you better. The cash in your bank account earns an interest rate similar to the loan and you can use the cash when investment opportunities arise. HSBC and SCB offers such features previously but my information is pretty dated. My current home loan is with SCB and called MortgageOne. 

My mortgage loan is currently pegged at 1.1% plus SIBOR and I have gotten a preliminary offer to reprice it to 0.9% plus SIBOR but the documents required by the credit officer is such a pain that I will not bore you with my frustration and almost wanted to give up on the repricing. 

Tip: always ask your existing bank to reprice your loan to a better rate after the promotional period is over. 

Is the property crash coming?

Your guess is as good as mine but I believe I have previously blogged about 2015 being the year to watch out for. With volume drying up, it is actually the buyers' market now. 

HDB prices are coming down


With HDB being the source of "upgraders" to private housing, the pricing of HDB will indirectly have an impact on the private property market. A falling price will effectively means that they have "less cash" for the upgraders. 

However this is just a general trend and you can see flats at Pinnacle, Bishan and Redhill continuing to generate very decent capital gains for the home owners. 

Tip: location is of key importance to capital gains. If you can get a HDB flat directly, you can maximize your returns if the location is good. First time flat owners in Pinnacle at Duxton or the flats near Mountbatten Square made good capital gains when they sell after 5 years and the flats can command very decent rental yields too. 


Private Property Price Index

You can see a "rounding top" forming across the different types of properties. It seemed like private housing will continue the downtrend in 2015. However, what will cause the price to crash will be "fear and panic" in the market place and I haven't seen it yet but market conditions remain challenging given the current government policies. 

My property investment journey

If you are new to my blog, I have documented my property investment journey. The various links are here consolidated here.

Capital Gains or Rental Yields?

This is only applicable for readers who are hunting for their second property. What are you looking for if you are buying a second property? Is it for capital gains or rental yield. If you are looking for yield, you can start scouting around but if you are looking for capital gains, you will need to see a "real crash" and the interest rake hike must just be the catalyst you need. 

Happy waiting .... Patience is a virtue. 

Subsequent update. 

This article appeared in the papers the following day. Perhaps the crash of oil price is the catalyst for the crash....?







13 comments:

Unknown said...

Thanks for sharing this post! I'll definitely share this one to my friends. Most specially to my friend who is planning to get a lakeville condo singapore I hope that by this one I'll be able to help her.

Surelia Dev said...

Incredible Bali is a residential development by Incredible Lands and Farms. It has a thoughtful design and is well equipped with all the modern day amenities as well as basic facilities. The project offers various odd dimensional plots and villas.

Plot in Hyderabad

Land in Hyderabad

Helen Hohc said...

Thanks for posting this! I think it's about time to check how flexible we can be when it comes to investing whether it's property or other stuff. I'll absolutely share this one to my friend who plans to buy a hdb flat for sale in Jurong west

Anonymous said...

I definitely agree with this article, the best time to take up property investments is when the market is all dried up. There is no other direction after but going up. In Singapore upcoming new lunches are the best investments specially those near CBD areas like fernvale new condo launch.

elson cade said...

Investing In a wide array of Properties of Singapore Real Estate and get Singapore Property Listings with Overseas Properties For Sale and do Investment. We create the best opportunities for Singapore Real Estate, Singapore Property Listings, Overseas Properties For Sale, Investment in Singapore Real Estate, Property for Sale/Rent and Singapore properties guide.

Unknown said...

Call Us at+91-9872076706 for Property in Mohali-Plot, Apartment, Flat, Bungalow, Villa, Independent Floors, Commercial Office Space, Assured Rental around Chandigarh and Mohali

My Property Store

Unknown said...

Buy your dream home in ATS CASA ESPANA MOHALI, 3 & 4 BHK Luxury Apartments Project on Chandigarh Kharar Road Sector-121, Mohali.Call us at 09872076706 / 09501549100.

Teddy said...

Do you need a personal loan?
Do you need a loan to pay bills/finance your business?
Do you need a mortgage loan? email: stevenryanfinance@gmail.com or whatsapp : +971529615981

jones morris said...

Thank you so much for the post you do. I like your post and all you share with us is up to date and quite informative, i would like to bookmark the page so i can come here again to read you, as you have done a wonderful job. fyve derbyshire floorplan

Paul Delphine said...

Hello everyone, I'm Patricia Sherman in Oklahoma USA right now. I would like to share with you my experience of borrowing USD $185,000.00 to clear my bank draft and start a new business. It all started when I lost my house and I took my stuff because of the bank policy and I met some bills and some personal needs. So I became very desperate and started looking for funds in every way. Fortunately for me, a friend of mine, Linda told me about a credit company firm, I was intrigued by the fraud, but I was intrigued by my situation and had no choice but to get advice from my friend about this company. contacting them really doubted me because of my past experience with online lenders, did you know that little? '' Elegantloanfirm@hotmail.com This company has been very helpful to me and my colleague and today, thanks to this credit company, the proud owner of well-organized work and responsibilities, they smiled back at me. So if you really need to grow or start your own business, or if you really need to borrow money in any financial hardship, we recommend you find a financial development opportunity in your business today. {E-mail:} Elegantloanfirm@hotmail.com ... online for credit not a victim of scam. Thank you.

Unknown said...

DO YOU NEED A LOAN : TRUST ME WE CAN SOLVE YOUR FINANCE PROBLEM
Do you need Personal Loan?
Business Cash Loan?
Unsecured Loan
Fast and Simple Loan?
Quick Application Process?
Approvals within 24-72 Hours?
No Hidden Fees Loan?
Funding in less than 1 Week?
Get unsecured working capital?
Contact Us At : urbansuccessfundings@gmail.com

LOAN SERVICES AVAILABLE INCLUDE:

Commercial Loans.
Personal Loans.
Business Loans.
Investments Loans.
Development Loans.
Acquisition Loans .
Construction loans.
Credit Card Clearance Loan
Debt Consolidation Loan
Business Loans And many More Loan Opportunity:

LOAN APPLICATION FORM:
=================
Full Name:................
Loan Amount Needed:.
Purpose of loan:.......
Loan Duration:..
Gender:.............
Marital status:....
Location:..........
Home Address:..
City:............
Country:......
Phone:..........
Mobile / Cell:....
Occupation:......
Monthly Income:....

Contact Us At urbansuccessfundings@gmail.com

Phone number : +919069983539 (Whatsapp Only)

agent alex said...

Investment plansPROMO PACKAGE 🔊 BASIC Invest $70 earn $600 Invest $100 earn $1000  Invest $200 earn $2,000  Invest $300 earn $3,500  Invest $400 earn $4,500  Invest $500 earn $6,000 
🔊 PRO  Invest $1,000 earn $15,000  Invest $2,000 earn $25,000  Invest $3,000 earn $35,000  Invest $4,000 earn $45,000  Invest $5,000 earn $60,000  Invest $10,000 earn $100,000. 
🔊 PREMIUM  1BTC earn 5BTC  2BTC earn 10BTC  3BTC earn 16BTC  4BTC earn 22BTC  5BTC earn 30BTC. 
ALL RETURNS ARE SCHEDULE, FOR 12 HOURS, UPON CONFIRMATION OF PAYMENTS.
MODE OF PAYMENT. Any, Suitable For Investors, But Terms and Conditions Apply.
⭐️HURRY NOW!!! Refer a Friend or Family member to invest same time, and Receive an instant $50 Reward. 
To set up an INVESTMENT PLAN, Contact Admin: totalinvestmentcompany@gmail.com
WhatsApp: +1(929)390-8581
https://www.facebook.com/pg/Total-Investment-221964325813140/about/
View more on YouTube: https://www.youtube.com/channel/UC3KWT9dTpFLi0S0vJTWuCJg

FOSHAN GOYU INDUSTRIAL CO, .LTD, established in 1987, It is a professional furniture hardware manufacturer and supplier, specializes in developing, producing and marketing furniture fittings. said...

Interesting article! Thank you for sharing them! I hope you will continue to have similar posts to share with everyone.

Sliding Door Damper

Related Posts Plugin for WordPress, Blogger...

Google Analytics