We Make $11k Per Month And Own A Newly-MOP Clementi HDB: Should We Upgrade To A Bigger Condo Or Buy 2 For Investment?

Dear Ryan

I’ve been an avid follower of Stackedhomes and really enjoy the concise content dished out by you guys, please keep up the great work. 

Currently I have a dilemma, my current details are as follows.

We are currently residing in Clementi and our 4-room flat reached MOP last year in 2023. My wife currently draws an income of $4,450 in her new job. We’re both in our early 40s.

For myself I am drawing a fixed salary of $11,580 per month including allowances and we plan to have kids soon.

We are looking to sell our MOP 4-room flat to upgrade and are caught in 2 minds if we should sell 1 HDB and buy 2 condo or just focus all our resources in 1 homestay with a preference for 3 bedder or a 3 + 1 bedder within district 5/district 21. Projects we like include Clavon/Clement Canopy/Parc Clematis/The Trilinq/Ki Residences.

Our balance housing loan is around 330k. 

Hope to seek your advice on our next steps. 

Note: some financial and personal details are redacted for privacy reasons

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Hi there,

Thank you for your kind words!

Whether you should sell your HDB to buy two private properties individually or combine your funds to purchase a larger unit for your residence depends on your objectives and whether the available options meet your living needs, as you will be residing in one of the properties.

If your primary goal is investment, buying two separate properties could potentially offer greater flexibility and diversification. You could rent out one property for additional income while living in the other. This approach could also provide an opportunity for capital appreciation from both properties, potentially increasing your overall return on investment if the right developments are chosen. 

On the other hand, combining your funds to purchase a larger unit for your own stay may offer a more comfortable living space for your family. 

That said, we’ll run through some numbers and see if these two options make sense. Let’s start by assessing your affordability. 

Affordability

These are some of the recent 4-room transactions for units above #30 in your development:

Date	Block	Level	Size (sqm) and unit model	Price
May 2024	30	37 to 39	93.00 Model A	$1,005,000
Apr 2024	30	37 to 39	93.00 Model A	$992,000
Apr 2024	33	31 to 33	93.00 Model A	$1,170,000

Looking at units above #30 sold over the last 6 months, the average price is at $1,025,833. For calculation purposes, we will assume this to be the selling price for your unit. 

Selling price	$1,025,833
Outstanding loan	$330,000
CPF used plus accrued interest to be returned to OA	$317,971
Cash proceeds	$377,862

Now let’s take a look at your individual and combined affordability. 

Husband (buying a private property)

Do note that we did not consider your bonuses when calculating your loan. It will be best to consult a mortgage banker for a more accurate figure.

Maximum loan with a fixed monthly income of $11,580, at a 4.8% interest	$1,134,010 (26-year tenure)
CPF funds*	$211,527
Cash**	$200,000
Total loan + CPF + cash	$1,545,537
BSD based on $1,545,537	$46,876
Estimated affordability	$1,498,661

*Includes CPF refunded after the sale of your HDB

**This is using $100K from your cash investment and $100K from your HDB cash proceeds

Wife (buying a private property)

Maximum loan with a fixed monthly income of $4,450, at a 4.8% interest	$427,140 (25-year tenure)
CPF funds*	$129,944
Cash**	$277,862
Total loan + CPF + cash	$834,946
BSD based on $834,946	$19,648
Estimated affordability	$815,298

*Includes CPF refunded after the sale of your HDB

**This is the remainder of your HDB cash proceeds after deducting $100K

Combined (buying a private property)

Maximum loan with a fixed monthly income of $16,030, at a 4.8% interest	$1,538,664 (25-year tenure)
CPF funds*	$341,471
Cash	$477,862
Total loan + CPF + cash	$2,357,997
BSD based on $2,357,997	$87,499
Estimated affordability	$2,270,498

Do note that our calculations did not include your CPF investments. So whether you purchase two properties individually or buy one together, you will be able to secure a unit in your preferred districts. With nearly $1.5M, you can get a 2-bedder for your own stay in your desired location and an additional 1-bedder elsewhere for investment at around $800K. 

That said, this may not be the most comfortable living situation if you have kids and/or a helper. With a combined affordability of $2.27M, you could purchase a 3-bedder in District 5 or 21.

Next, we will crunch some numbers and examine the potential costs involved in these two pathways.

Potential costs

You will likely need to maximise your budget for both if you intend to purchase a unit in one of the developments you’ve listed for your own residence. For calculation purposes, we will use a 10-year holding period.

Buying 2 properties individually 

Own stay property under husband’s name

Purchase price	$1,490,000
BSD	$44,200
CPF + cash	$411,527
Loan required	$1,122,673

Costs involved

Interest expenses (assuming 4% interest with a 26-year tenure)	$393,172
BSD	$44,200
Maintenance fee (assuming $280/month)	$33,600
Property tax	$19,500
Total costs	$490,472

Investment property under wife’s name

We will presume that the property is rented out at a conservative yield of 3%.

Purchase price	$810,000
BSD	$18,900
CPF + cash	$407,806
Loan required	$421,094

Costs involved

Interest expenses (assuming 4% interest with a 25-year tenure)	$146,119
BSD	$18,900
Maintenance fee (assuming $200/month)	$24,000
Property tax	$29,160
Rental income	$243,000
Agency fee (payable once every 2 years)	$11,035
Total gains	$13,786

Total costs if you were to take this pathway: $490,472 – $13,786 = $476,686

Buying 1 property together

Purchase price	$2,270,000
BSD	$83,100
CPF + cash	$819,333
Loan required	$1,533,767

Costs involved

Interest expenses (assuming 4% interest with a 25-year tenure)	$532,214
BSD	$83,100
Maintenance fee (assuming $350/month)	$42,000
Property tax	$48,140
Total costs	$705,454

Total costs if you were to take this pathway: $705,454

Naturally, with the higher loan amount, interest expenses will be increased. Additionally, without rental income from a second property to offset some of the expenses, purchasing one property together will result in higher overall costs. 

However, as mentioned earlier, a 3-bedder will provide a more comfortable living space for your family. So it is important to note that we are only considering costs here and have not factored in the potential appreciation of the properties.

Now, let’s take a look at the developments you are considering.

Developments under consideration

Considering their relatively young age, all of the developments have shown decent growth over the past 5 years:

Project	2019	2020	2021	2022	2023	2024	Growth (2020 – 2024)
Clavon		$1,646	$1,637	$1,696	$1,904	$2,002	22%
Clement Canopy	$1,544	$1,487	$1,631	$1,731	$1,836	$1,881	27%
Ki Residences		$1,781	$1,815	$2,001	$2,166	$2,152	21%
Parc Clematis	$1,615	$1,628	$1,694	$1,789	$1,988	$2,053	26%
The Trilinq	$1,375	$1,443	$1,520	$1,591	$1,667	$1,726	20%

In this case, it’s safe to say that given their young age and decent growth recently, all the developments shortlisted should serve as a good hedge against the real estate market growth.

Here’s a quick look at each development’s location as well as recent transactions:

Parc Clematis and The Trilinq

Since both developments are adjacent, they share the same amenities and conveniences. Both are within a 15-minute walk to Clementi MRT station, which is next to a shopping mall, wet market, and food centre. They are also within a 1 km radius of the popular Nan Hua Primary School, which is a huge draw for families with children. Additionally, they are close to the Ulu Pandan Park connector that leads to the Rail Corridor. However, the projects are situated along busy roads (AYE and the intersection of Clementi Ave 6 and Commonwealth Ave West), meaning certain units may experience road noise, especially during peak hours.

Parc Clematis is a mega-development featuring 1,450 condo units and 18 strata-landed houses. It offers a balanced mix of units, ranging from 1 to 5-bedrooms, catering to both homeowners and investors. The project is on a sizeable land plot of 58,898 sqm, with well-spaced blocks. It has a 99-year lease starting in 2019 and obtained its Temporary Occupation Permit (TOP) in 2023.

Here are some of the recent transactions:

2-bedroom

Date	Size (sqft)	PSF	Price	Address
May 2024	710	$2,048	$1,455,000	8A Jalan Lempeng #03
May 2024	743	$2,087	$1,550,000	8F Jalan Lempeng #17
May 2024	689	$1,844	$1,270,000	8C Jalan Lempeng #05

3-bedroom

Date	Size (sqft)	PSF	Price	Address
May 2024	915	$2,120	$1,940,000	8F Jalan Lempeng #16
May 2024	1,044	$2,078	$2,170,000	8E Jalan Lempeng #04
May 2024	829	$2,123	$1,760,000	8B Jalan Lempeng #19
May 2024	893	$2,138	$1,910,000	8E Jalan Lempeng #22

As for The Trilinq, it is half the size of Parc Clematis, occupying a land plot of 24,448 sqm. Despite being smaller, it remains a substantial project with 755 units ranging from 1 to 4 bedrooms, offering a well-balanced mix. It has a 99-year lease starting in 2012 and obtained its TOP in 2017.

Here are some of the recent transactions:

2-bedroom

Date	Size (sqft)	PSF	Price	Address
Apr 2024	710	$1,729	$1,228,000	28A Jalan Lempeng #11
Apr 2024	710	$1,788	$1,270,000	28A Jalan Lempeng #33
Mar 2024	1,109	$1,466	$1,625,000	28A Jalan Lempeng #10

3-bedroom

Date	Size (sqft)	PSF	Price	Address
May 2024	1,044	$1,801	$1,880,000	28 Jalan Lempeng #07
May 2024	1,356	$1,615	$2,190,000	28 Jalan Lempeng #12
May 2024	1,346	$1,747	$2,350,000	28A Jalan Lempeng #26
Apr 2024	915	$1,858	$1,700,000	28B Jalan Lempeng #17

Examining recent transactions for both projects, Parc Clematis shows a higher price per square foot (PSF). This means that, for a similar price, you can get a larger unit in The Trilinq, although it is slightly older.

The Clement Canopy and Clavon

The Clement Canopy and Clavon are adjacent properties separated by a land plot that was sold in a Government Land Sale (GLS) last November.

This could bode well for both developments, considering its estimated breakeven price PSF stands at $2,156, which already surpasses the average PSF for both projects, excluding the developer’s profit margin. This factor might potentially support property prices in these developments.

Being in close proximity, both projects share similar amenities. They are within a 15-minute walk to Clementi MRT station, Clementi Mall, wet market, and food centre. Additionally, they are a short walk to West Coast Plaza, West Coast market and food centre, Clementi Woods Park, and within a slightly longer walk to West Coast Park, all reachable within 20 minutes. However, neither project falls within the 1 km radius of Nan Hua Primary School. Certain units face the AYE, potentially experiencing traffic noise.

The Clement Canopy is situated on a 13,038 sqm land area and is a mid-sized development comprising 505 units ranging from 2 to 4-bedroom layouts. With no 1-bedroom units available, the property may attract a higher ratio of homeowners compared to investors. It holds a 99-year lease that commenced in 2016, with its TOP obtained in 2019.

Here are some of the recent transactions:

2-bedroom

Date	Size (sqm)	PSF	Price	Address
May 2024	635	$1,937	$1,230,000	16 Clementi Avenue 1 #36
May 2024	710	$1,858	$1,320,000	18 Clementi Avenue 1 #13
May 2024	732	$1,674	$1,225,000	16 Clementi Avenue 1 #02

3-bedroom

Date	Size (sqm)	PSF	Price	Address
May 2024	1,109	$1,962	$2,175,000	18 Clementi Avenue 1 #26
Apr 2024	990	$1,929	$1,910,000	18 Clementi Avenue 1 #32
Jan 2024	1,109	$1,804	$2,000,000	18 Clementi Avenue 1 #06

Clavon, in contrast to The Clement Canopy, is a slightly larger mid-sized development featuring a diverse range of 1 to 5-bedroom units, totalling 640 units. It occupies a land plot spanning 16,543 sqm and holds a 99-year lease that commenced in 2019. The project is supposed to achieve its TOP in 2026 according to plans, but some homeowners have already collected their keys. 

Here are some of the recent transactions:

2-bedroom

Date	Size (sqm)	PSF	Price	Address
May 2024	764	$1,850	$1,414,000	6 Clementi Avenue 1 #04
May 2024	764	$1,963	$1,500,000	6 Clementi Avenue 1 #18
Mar 2024	764	$1,963	$1,500,000	6 Clementi Avenue 1 #12

3-bedroom

Date	Size (sqm)	PSF	Price	Address
May 2024	1,130	$2,062	$2,330,888	8 Clementi Avenue 1 #08
Jan 2024	958	$1,952	$1,870,000	8 Clementi Avenue 1 #14

Since Clavon has not yet obtained its TOP, the transactions mentioned above are sub-sale transactions. Currently, the average price PSF for both developments is relatively similar, but it remains uncertain if this trend will continue once Clavon obtains its TOP and has more transactions.

Considering the upcoming new launch between these two projects, it is anticipated that prices for both developments will remain resilient and potentially continue to rise in the near future.

Ki Residences

In terms of location, Ki Residences currently stands as the least accessible among the other four projects. It is not within walking distance of an MRT station, nor are there bus services that go to the project at present. However, a new road, Brooksvale Lane, which will link to Clementi Road, is under construction and bus services may potentially be introduced in the future. To mitigate the current accessibility challenge, the developer plans to offer free shuttle services for the first year. 

Additionally, the upcoming Maju MRT station on the Cross-Island Line will be situated within 1 km of the project, requiring approximately 10-15 minutes by foot depending on walking speed. The Maju MRT station is expected to be completed by 2032.

Amenities near Ki Residences are more limited compared to the other developments. However, residing here offers a quieter and more serene environment. Within a 15-minute walk, there is a Cold Storage supermarket and a few cafes. A slightly longer walk, but still under 20 minutes, leads to more dining options within the Sunset Way HDB cluster.

Beyond accessibility, a significant distinction of Ki Residences from the other four projects is its 999-year tenure, appealing to buyers looking for long-term ownership. The development spans a land plot of 34,727 sqm and consists of 660 units, ranging from 2 to 5-bedroom types.

Here are some of the recent transactions:

2-bedroom

Date	Size (sqm)	PSF	Price	Address
Feb 2024	753	$2,214	$1,668,000	6 Brookvale Drive #08
Jan 2023	753	$2,123	$1,600,000	20 Brookvale Drive #06

3-bedroom

Date	Size (sqm)	PSF	Price	Address
May 2024	861	$2,125	$1,830,000	14 Brookvale Drive #03
Apr 2024	936	$2,275	$2,130,000	10 Brookvale Drive #06
Oct 2023	1,378	$1,727	$2,380,000	22 Brookvale Drive #12

Looking at this, a 2-bedder might be out of your budget but you could possibly get a smaller 3-bedroom unit under both your names.

Now considering its 999-year leasehold tenure, it is reasonable to expect that prices will maintain their value over the long term.

Furthermore, Ki Residences stands to gain from the upcoming development of the area. According to the URA Master Plan, The Maju Forest next to the project is designated for residential developments pending detailed planning. Adjacent to it is a reserve site marked in yellow, indicating that its future use is still undetermined.

While the timeline for the development of these plots remains unclear, their potential future development may enhance the area’s convenience if there are added amenities. Moreover, the introduction of new residential units in the vicinity has the potential to positively impact property values at Ki Residences.

With regards to which development you should pick, we’d like to look at it from both an analytical and personal standpoint. From a numbers perspective, we would consider the current prices relative to similar new launches in the area, and perhaps outside the district you prefer (if you’re open to it). We’ll also have to compare the different project’s stacks and facings alongside their price differences. For this, we would recommend having an in-depth consultation with us (link).

What should you do?

From a purely financial standpoint, opting to purchase two separate properties would be more advantageous. This strategy divides your risks, and the rental income from one property can help offset some of your expenses, thereby reducing your overall costs. 

However, considering you wish to start a family and your intention to reside in the property, the liveability of the space is ultimately still the most important factor. While it may be feasible for your young children to share a bedroom in a 2-bedroom unit initially, space constraints may become more apparent as they grow older. 

As such, squeezing into a 2-bedroom condo unit may prove more challenging than it seems as your budget does not allow you to purchase a larger 3-bedroom condo in your desired location. This is unless you’re willing to purchase an older leasehold development further out.

Therefore between the two options, we would recommend combining your funds to purchase a 3-bedder rather than buying two separate properties. Although the cost is likely to be higher, as shown in the calculations, it will undoubtedly provide a more comfortable living space for your family. Additionally, our calculations did not take the property’s potential appreciation into account.

Considering your wife’s affordability, there may be limited options available. If you eventually want to own two properties, you could consider doing so later. This would give you more time to accumulate funds and for your wife to potentially earn a higher salary as she gains more experience in her new job.