So Louise and myself decided to sell our resale HDB (government public housing) that we bought back in 2009; and now mulling and cracking my brain if we should
- buy a new HDB BTO/balance of sales flats OR
- upgrade to a freehold apartment
The challenges are
- HDB is wonderful with 1 main bugbear: 99 year lease decay. Freehold properties dont have this same issue – but of course the price is more than 250% more PSF wise which I’ll have to liquidate most of my investments to enter, which will take me out of baristaFIRE
- I dont want to wipe out my investments and liquidate them to upgrade to freehold apartment. Though the idea of freehold to preserve capital will be good, but that will possibly mean I have to retire later than 50 (aim for 45). I like the peace of mind and heart to make sound decisions and have more time with my loved ones
- I want to get my boy to try to enter St Andrews Junior in 2 years time. If we get in, then we’d be staying in potong pasir / woodleigh / bidadari area for a good 5+ years
I have 3 investments to spread out and stack my chances of increasing and growing value, but they will take time to grow tremendously with small chance of failure. At least 5 years to be conservative.
Current decision / conclusion
- continue renting until 18 months time when I find out if my boy can enter St Andrews Junior (Primary) or not, if yes I’ll be stuck within 1 KM of here ie potong pasir, toa payoh, woodleigh and bidadari area; if not we are free to move anywhere
- purchase a new HDB with 99 years lease after 5 years of Minimum Occupancy (MOP) period, we can either continue staying and let our investments continue to grow as portfolio; or sell HDB with capital gains if the investments do well later to purchase the freehold apartment and preserve the investment portfolio
Tomorrow I’m consulting one of my wealth manager to see if my conclusion is the best one, or if there is a better decision.
HDB or freehold apartment, depends on so many reasons – cash on hand, CPF, salary drawn, investment style/risk, preference for property etc.
You have to decide what suits you, and dont overstretch to purchase large properties and big mortgages if it means that it locks you into work and unable to enjoy it (cos you need to pay the mortgage) or retire early (which is important to enjoy your life, relationships, hobbies, travel etc).
If cash no issue, then no issue la ehehe. But if push comes to shove, I prefer simpler enjoyable life than to have to keep working to pay for something I dont need so big for.
I’m the founder and writer here at NigelChua.com; as well as serial entrepreneur, therapy business entrepreneur, digital entrepreneur, investor and also happy husband, father and Christian.
Started and sold off a business for 7-figures; built another 7-figure one and growing it further, plus building/investing into other businesses and investments as well as advisory works.
Nowadays I share and teach entrepreneurship, financial independence, retiring early as well as building and living a life you love.
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