Does it make sense to commit a 99-years lease private condo?

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Does it make sense to commit a 99-years lease private condo?

Postby mel2sg » Tue Jul 24, 2012 8:26 am

Hi

Currently, we are staying in HDB, and considering a second property. Last weekend, after lunch we drove around few fully sold near-TOP private condos in the West, for a gauge of how the property market like. There was this property agent who noticed our car & approached us. Briefly telling us the approx psf & price. As we have 2 kids, I asked him for the price of 3-rooms.......my god quoting me $1.1m :scared: somemore it is 99- years lease.

Does it really make sense to buy a 99-years lease apartment - esp when after 20 - 30 years & with the remaining years, do you think still can offload in above purchase price? Or is it considered a depreciating asset in the long term?

Appreciate your comment as I have neither the knowledge nor experience in this area, thanks.

mel2sg
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Re: Does it make sense to commit a 99-years lease private co

Postby dolphinsiah » Tue Jul 24, 2012 9:34 am

I also do not understand the current Singapore property trend.

But Singapore Housing Price to me is too high.....

A 99 year 4-5 room (1000sqft -1200sqft) HDB can fetch around 500k-700k...
A 99 year Condo also about 1200sqft is around 1million
A 999 year Condo 1300sqft is about 1.2million

I spoke to a Bank Housing Loan Officer , why a 99 year old Condo can fetch so high price compare to a 999 year old Condo....

The Bank Officer told me for a brand new 99 year old Condo , to obtain a loan as a first owner is easy but when the Condo is less than 30 years from 99 years it would be difficult to obtain a loan....

Yes, now housing loan interest is very low, but can you imagine to be in debt for the next 30 years....if you buy a 1 million Condo....

This the scenario of a typical Singapore family :

a)Housing Loan : SGD300k(HDB)
b)2 schooling kids : SGD600k(until University)
c)A saloon car: SGD100k (10years)

Not forgetting , we must save for our old age....

My mom also criticise me for being a Spoiler.....always prevent people from "Getting Rich"....

This is how I feel , unless you have extra extra money ...then invest in properties/stocks.....

Anyway , I am now working towards my retirement.....hopefully I aged healthy , have 1-2K per month to spend during my old age.. :xedfingers:

Which means I need 300-400k :moneyflies: when I retire by 62?? :skeptical:

dolphinsiah
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Re: Does it make sense to commit a 99-years lease private co

Postby AC_Power » Tue Jul 24, 2012 11:05 am

As what all property agent will tell you, when looking at private property, only factor that matter is the location.

A 99-year leasehold near MRT station, good school, amenities will always be in much higher demand that one which is 999-year leasehold or freehold which is not easily accessible, without much amenities and located at one far end of Singapore.

If the location is good, you can be sure that developers will be pushing your condo management to accept their en-bloc offer before 30 years is up.

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Re: Does it make sense to commit a 99-years lease private co

Postby verykiasu2010 » Tue Jul 24, 2012 11:22 am

if it is of 99-yrs leasehold condo, I won't touch it if it is not in D 9, 10, 11.

however, I will consider a 99-yr leasehold if it is HDB, a few minutes walk from MRT station, amenities around, good schools nearby, good facing, high floor

honestly for 99-yrs leasehold condo in outlying districts - there isn't much diff with an EC or HDB. so why pay premium to be eroded ?

just my personal opinion and personal preference. everyone else is free to disagree
verykiasu2010
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Re: Does it make sense to commit a 99-years lease private co

Postby AC_Power » Tue Jul 24, 2012 11:34 am

99-yr condo at outlying districts with the right amenities around can have their values held and appreciated, not necessarily eroded.

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Re: Does it make sense to commit a 99-years lease private co

Postby Guest » Tue Jul 24, 2012 11:39 am

verykiasu2010 wrote:if it is of 99-yrs leasehold condo, I won't touch it if it is not in D 9, 10, 11.

however, I will consider a 99-yr leasehold if it is HDB, a few minutes walk from MRT station, amenities around, good schools nearby, good facing, high floor

honestly for 99-yrs leasehold condo in outlying districts - there isn't much diff with an EC or HDB. so why pay premium to be eroded ?

just my personal opinion and personal preference. everyone else is free to disagree


I agree! :hi5: But maybe extend 9,10,11 to include Bishan....the soil there like very fertile. :evil:
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Re: Does it make sense to commit a 99-years lease private co

Postby fightingmom » Tue Jul 24, 2012 11:42 am

I look it in another way:

If you are going to buy a condo to rent out, a 99year property is ok because it will definitely fetch a better rental yield compared to a freehold property.

You paid much more for a freehold property compared to a leasehold property but the rental amount could be the same.

A potential tenant will not take into consideration whether the property is a leasehold or freehold. They would be more concerned with amenities, condition of the house and locality, etc.

Of course, location and accessiblity is most important.

JMHO

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Re: Does it make sense to commit a 99-years lease private co

Postby Busymom » Tue Jul 24, 2012 11:50 am

fightingmom wrote:I look it in another way:

If you are going to buy a condo to rent out, a 99year property is ok because it will definitely fetch a better rental yield compared to a freehold property.

You paid much more for a freehold property compared to a leasehold property but the rental amount could be the same.

A potential tenant will not take into consideration whether the property is a leasehold or freehold. They would be more concerned with amenities, condition of the house and locality, etc.

Of course, location and accessiblity is most important.

JMHO

I agree with fightingmom on the consideration for investment properties. Besides that, one should have holding power if want to invest in a L/H. In a bearish market, the price for L/H will fall more than a F/H.

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Re: Does it make sense to commit a 99-years lease private co

Postby Busymom » Tue Jul 24, 2012 11:57 am

AC_Power wrote:
A 99-year leasehold near MRT station, good school, amenities will always be in much higher demand that one which is 999-year leasehold or freehold which is not easily accessible, without much amenities and located at one far end of Singapore.



This is very true. Has seen a L/H ppty in district 8 (next to MRT) appreciating faster than a F/H in district 11 (MRT still under construction).

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Re: Does it make sense to commit a 99-years lease private co

Postby TheAnswer » Sun May 10, 2015 11:46 pm

mel2sg wrote:Hi

Currently, we are staying in HDB, and considering a second property. Last weekend, after lunch we drove around few fully sold near-TOP private condos in the West, for a gauge of how the property market like. There was this property agent who noticed our car & approached us. Briefly telling us the approx psf & price. As we have 2 kids, I asked him for the price of 3-rooms.......my god quoting me $1.1m :scared: somemore it is 99- years lease.

Does it really make sense to buy a 99-years lease apartment - esp when after 20 - 30 years & with the remaining years, do you think still can offload in above purchase price? Or is it considered a depreciating asset in the long term?

Appreciate your comment as I have neither the knowledge nor experience in this area, thanks.


Will anyone consider buying 99 year lease condo which is around 13 years old this year? If yes, why? If no, why?
We have no issues with the condo and the nearby amenities.. just a bit concerned with the remaining lease.. Any property experts around?

TheAnswer
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