Invest[property special] 2:

2nd article that caught my eye!
DONT LET YOUR HOME LOAN HAUNT YOU!

It teaches one to consider the interest rates and lock in period etc when consider a mortage package.

Francis Chan shares his story of when buying his first house... he is shocked when he received a letter from bank to say that '' due to the flutuaction of interest rate environment, his monthly installment would have to be increased.'' This is when he haven even unpack his stuff in the new house.

So... some important information in the article

WHAT BANKS ARE OFFERING

1. DBS

Sibor fixed rate (Sibor stands for Singapore Interbank Offered Rate)

Year 1- 1.99% Year 2-1.99% Year 3-1.99%

Thereafter 3- or 12-mths Sibor +1.75%

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2. UOB'

Floating rate

Year 1- 3.5% Year 2 - 3.75%

Thereafter 4%

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3.OCBC

Floating rate

Year 1- 1.6% Year 2 - 1.6% Year 3-1.6%

There after 3.75%

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4.Maybank

3year fixed rate

Year 1-1.6% Year 2 -2.2% Year 3-2.9%

Thereafter 3.75%

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5.StanChart

2 year fixed rate

Year 1-1.5% Year 2- 2.5%

Thereafter 3-mth sibor +1.25%

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Fixed rate means protected against the fluctuation of the market interest rate... Its good, thus you can see, no bank provide fixed rate throughout lo...

then the author also mentioned about locked in period. It refer to how long you are tied to the bank and allow it to penalise you if you decide to redeem your loan early.

Haha.. first time home owner, good luck!(haha, including me too!)

Invest[property special] 1: Current property RUN

After reading the Invest pages in Strait times 12th July, I am drawn to 2 articles. The first one, is the headline, the front page!



It starts with...

''Recession? What Recession? The residential property market is on a roll with owner-occupiers, speculators and investors...''

"Demand shot through the roof and prices are rising.'''



So, this article is about the increase in demand for private apartment...despite the so call recession, the property market is doing well



Property Correspondent Joyce Teo came out with some reasons. I shall summarise it here.



1. Suburban boom

As people missed the bull run after 2007, many are catching it now, having the thoughts that its at the bottom of the market.

The Caspian, 99year leasehold project in Jurong West sold 300 units over 3days. Then followed by other project. Thus, believe this spark the boom off.



2. Interest absorption.

Paying 20% of the purchase, and you will be the owner of the apartment!

More attractive, the Interest Absorption Scheme(IAS), requires you to take up a bank loan, but the developers absorbs the interest payments until the project has been finished!



3. Small is beautiful

Projects that offer smaller, affordable units



4. VIP previews

When one call to register interest, they will be invited to a special preview! Being among the first to buy and choose.. plus, preview price lower than launch one!



5. Where are the price now

Price have dropped but experts are saying it may not last long...



Being in Singapore, one very good news is that we are not very affected by the recession! I think most Singaporeans dont even care what period is this. As recently GSS(Great Singapore Sale), Mastercards purchases shot to highest among recent years. Hopefully, these are not unnecessary spending just due to the GSS.

Thus, I not very suprise by the article above . Also, for investors, it might really be a good time to go into property market! XD Before the demand shot so high and affect the pricing again.



Propery investment need be cautious as it involve large sum of money. Even if now is the best time, the bottom of the market, we need to consider some factors before jumping into it.

Factors to consider include(after study the market):

1. Location

2. Loans available

3. Interest rate

4. Ability to support the apartment if unable to resell



Cost to consider when buying a property:

-Mortage payment(<40%>

-Legal cost(<1.5%>

-Stamp duty (0.7% for first $180000 1.4% on next etc)

-Valuation report

-Insurance premium(life+fire)

-Property tax(ard 4% if owner occupied, 10% if rented)

-Maintanence and Operating expenses



People who are going to be first time home owner may be interested in the article I going to intro next:)