Analysis

How ABSD Deadlines Can Negate Your New Launch Discounts

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Ryan J

A seasoned content strategist with over 17 years in the real estate and financial journalism sectors, Ryan has built a reputation for transforming complex industry jargon into accessible knowledge. With a track record of writing and editing for leading financial platforms and publications, Ryan’s expertise has been recognised across various media outlets. His role as a former content editor for 99.co and a co-host for CNA 938’s Open House programme underscores his commitment to providing valuable insights into the property market.

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Rani Govin
Rani Govin
2 years ago

Thanks for the great article Ryan, very useful in educating buyers like me as well as informing us of the options in securing the best deal possible. I am actually torn between buying an older resale HDB unit with little to none loan taken or a new launch with a longer loan repayment but possibility of growing capital investment. I am 46 years old and I have a steady income ($10K a month). I recently sold my condo at a negative sales and while all the proceedings were returned to my CPF, i actually bled cash due to the 2% commission paid to the property agent which was all paid in cash. So now, I have a choice of buying a resale HDB fully paid with CPF and cash (the good ones come with a hefty COV) or buy a new launch with again a big loan to my name. While my inclination is to go with the former, I am also not closed to the option of exploring newer launches or even resale condo (as mentioned above) with good potential or discounted due to the ABSD deadline. I am just worried about carrying a big loan as I am planning to take it easy and slow down with work.

Do you have any advice for me? I have about $500K in CPF and about $50K in cash that I can use for home right now.

Rani

Stacked Homes
Admin
2 years ago
Reply to  Rani Govin

Hey Rani! Thank you for sharing your detailed thoughts with us. While it’s hard to advise you here simply based off what was said, I do think that the general advice would apply to most people in your situation. I think it boils down to what is the quality of life you’re looking for, and not something we can say is right or wrong for you. HDBs are generally bigger and more comfortable in terms of living space, but it lacks facilities – so if that’s important for you, then we’d be leaning towards condos. There’s also monthly cash outlay for having these facilities too, so do be aware that on top of the loan, you’ll have to pay for the maintenance fees on top of the loan interest rates each month. That being said, a 10K monthly income is okay, but if you’re the only person with this income to sustain the loan, then it can be quite dangerous because if this source of income is lost, then you may be in a position to sell your property quickly which would not be good. If you do have 6-8 months of living expenses + mortgage payments, then this is still acceptable. So ultimately it just boils down to what kind of quality of life you’re looking for, and whether you have the financial power to purchase a condo without putting yourself in a potentially distressing situation. Hope this helps!

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