ฝัง
- เผยแพร่เมื่อ 21 ก.ย. 2024
- A lot of Singaporeans are looking at Singapore Property as a stable investment opportunity, and this has rubbed itself into the young generation as well. With retirement as the goal, they have set themselves on a path of high leverage to buy condominiums. The Alternative could be an investment path thru the CPF, S&P500 & Nasdaq (Stock Market).
In this video, Loo would like to give his 2 cents on the topic.
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Actually nowadays youngsters have no fear of not able to pay up their BTOs or condos. They have a backup plan if unable to pay off the loan - just get money from parents. That’s why I have been saying youngsters only think for themselves, as it never strike on them that their parents also need money to retire. And the fun fact was, some youngsters were offended when I said that 😅
How do u think they are able to spend 70k-100k+ on home Reno and 700-800k on resale flats ??
After borrowing $$ from parents , it will become $$ that’s “given “
When it comes to their parents retirement, they will come up with all sorts of excuses to avoid taking care of them 😢
If they buy a private property in the outskirts it is almost same price as an HDB flat in prime area, so it's not so much of a problem.
This is not a recent phenomenon. It is happening since 1990s hence the govt’s introduction of EC, DBSS etc. Agree that one should not over-leverage on housing. Many may not see the risks of over-leverage now but during 1990s and until 2008/2009, there were periods where property prices dipped significantly, leading to many bankruptcies..
Good points and good advice for the young. Never over leverage and need to have holding power or contingency plan for black swan.
TDSR is at 55%. New EC even worse at 30% MSR. It is already a cooling measure to ensure financial prudence amongst buyers. How to over stretch with this measure in place?
Amazing audio quality! New format is more professional looking…and sounding. Anyway yes Loo…These young people are gonna get stuck 😂
Much appreciated!
With all the gov property curbs in decade long, I don't think anyone can over-leverage now. If those young people can afford, likely they could.
Yes agree. Those who can't pay downpayment and with low salary (that parents can't pledge $1mio to enable mortgage) are not buying. If they can qualify, no one needs to worry for them. It's parents choice. Loo must relac.
Yes. Totally agree. They will be heavily in debt. Not to mention the monthly condo maintenance is at $400 to $500 and higher property taxes. When in debt, a person has to suck up all the crap at work with no options out.
Parents are afraid that by the time their children are going to get their own house,they will have to pay like $3000psf. Might as well help them get one 1st now.
Those young buyer's whose parents can help, they should take the leap since property prices in Singapore have always been on the rising trend. If they don't buy early they will need to fork out much more later. However, this only applies to those lucky younger people with parents who has that ready cash from their retirement, CPF, downgraders selling their bigger properties, etc etc. Five or ten years later, condo PSF may be reaching the range of $2,500 to $3,000. Isn't even far more unaffordable later? Imagine S$3 million for a one thousand square feet condo ten years in the future. When I bought my first property 14 years ago, I had complained about the high price ($900 psf) too.... But, I do not have rich parents helping me to pay the down-payment so I used my OA and savings from my miserable monthly salaries lo :)
Most young people are keen to invest in local property. Start young is the best. In a way its forced savings. If not they may be spending on wants & luxuries. Even there is a slight drop in prices or losing their jobs. Property can be sold and withdraw proceeds as savings.
Mr Loo may have missed an important observation - The bank of Mom and Dad. A large downpayment of 20%-30% or more of the mortgage is being financed by boomer parents.
So even if one is temporarily unemployed - in come mom and dad to the rescue - at least till your next job.
What we are witnessing is a transfer of generational wealth.
Mr. Loo your time and my time are the sandwich generation. we got elderly parents to support for their rest of their life.
and now a days our generation don't expect children to fund our retirement. Better still many parent leave some money for children to buy house.
So I think they have better position than us to aim for their condo dream if they are eligible for loan go for it.
it may be a motivation for them to work even harder.
As I always agree with u to live below means.
So our view for next generation may seen as outdated.
I am not worried. they can take the beating and grow even stronger if really something goes against them.
Good comment....Another problem that we the baby boomer folks face, what u going to do with your money? Give to Nasdaq or Fund Managers? Smarter?
Hand to heart. It is the parents who r chasing.
Remember, we can't bring up 5cts when one goes. So there is no need to beat up so much. Allocate fund smartly in time with calculated risk.
If the Buyers can't qualify the buy, they can't.
Always good advice.
No worry, if you are young (< 35) age is your advantage to leverage from bank. 80% of property price usually doubled in 15-20 yrs the worse.
Thank you Mr Loo for pointing out the risks, potential consequences and sharing on other safer ways to grow wealth 😊 its useful for younger people to hear from more experienced folks who have seen the ups and downs in the market and other real life situations.
What is over-leverage? For some, it is 55% of their income, for some, it is 10% of their income, there i no end to this argument because we're merely using different yardsticks. But Kudos to Mr Loo on trying to define this with being able to do it without extreme stress. But again, I'd sleep better with property investment vs having $500K in stocks. Imagine if economy is so bad that your investment property price goes down by 25-30%, what is likely to happen to the $500K in stocks...
Question is: if not now, when . Still need a roof.. young people may be worried that they might not have a home in a country they call home.. esp singles
It’s a no brainer to buy any property in Singapore be it hdb or condo, Sg is unique with regards to property,land is scarce, stable government, lots of overseas buyers hence price is always going up. If young couples can afford to buy condo,buy it n build up the equity. If parents r rich , give them their inheritance now to buy, why wait till u die! , prices by then will b much higher.
Agree 101%. Loo ..
By all means let them buy. Just as long as they are NOT allowed to own HDB at the same time. As long as this major property loophole is not closed, future generations will suffer trying to secure a HOME.
I'm not sure if it's possible to learn from someone whom got burnt in property to share?
Singaporeans buy private condos because
1) takes years to get bto!
2) too many restrictions!
3) 99 years leasehold private condos still provide good return when enblocked!
My parents have no means to help me with my hdb flat. My younger cousins, each has a condo before they got married because deposit was paid by parents. I totally agree with what Mr loo said about losing job, losing health or running into situations where we had to hold on to a job we don't like. For me, hdb suffice. I would not want to be a slave of a property
This is the trend now. Thanks for admitting. Parents pay deposit for condo, children 'buy'. Its what has been happening in China for the last decade. The parasitic 'virus' is spreading.
Many years ago, a young staff of mine bought a Mitsubishi EVO. I know how much he is drawing. So I was surprised he could afford it. When I asked him about it, he said looking 'sad'.... 'my dad sold his car and paid the down payment for this. Now I have to pay monthly mortgage and send him to work'.
I was at a loss for words. Where is the sense of guilt? Instead he thinks he is doing his parents a favor!
@@marvelcomiks8078 maybe that is what dad want. to see his son everyday alone to talk.
Look at the comments here. Dun just blame the young gen, it is the parents' own doing. See the conventional thinking: Give them headstart in life (tuition, enrichment, downpayment for car, house, financial support etc) , and ya, this headstart has actually become lifetime handicap. What's next? Next gen who are so self entitled will then want to keep all the goodies for themselves, they will not want children to add on burden to their lifestyle. Whose fault? Easy to just live in denial and blame today's society, economy, government, school, tuition centre etc but no parents has ever reflect to blame their own doing.
The Bible says borrower is slave to the lender.
When there’s a wave of retrenchment, a lot of people will go under or will be over-leverage.
Good advise !👍👍👍
Very good article. Dr Thomas Stanley, Dave Ramsey and
Mr Loo echo the same msg. Either u want to look rich of you want to be rich.
My BmW fren pick me up.Worried to park near tekka centre cos parking $0.60 more go park further away and end up we both walk damn far. I told him his fuel cost plus waste of time take up more than $0.60. lol
This same fellow told his wife can we move b to HDB cos expenses to high as everything on loan. Wife told him want like that better to divorce. U go your way I go mine. They no kids. Got maid though. Wife say must have maid all the way.
Real story.
Thank you for the anecdote!
Horror story. If wife like that say then wife’s suggestion may be a good idea.
Singapore in the next 4 to 5 yrs time, the job will not be as many as now mainly because of the uprising of india and vietnam. Job will move to there. Look at china is a good example but we are not even as big as china with no resources, The high price in rent , property, wages and even food is not an attraction to business even though we have efficient government. Everyone say after cny job cuts will start so hopefully they will wake up some if not most to revalue their buy item.
Parents helping them thats why - generational wealth
The median income from the stats includes cpf excludes tax. Its not take home pay. They could be using cpf OA to pay mortgages and underfunding their retirements. Also the couple might have other loans for example cars. When kids comes one spause usually have to take a step back in their career.
Chasing the recency effect blinds many because they buy into these giant condos of 2000 over units. Who is going to buy that from you? There’s easily a few hundred units trying to sell with you. Don’t get blinded by the spin that agents push you. When you are looking at the condo, is it something you’d want to live in for a long time?
Condos that are like hub precincts are a nightmare.
Well said!
There is nothing wrong when parents can fund the downpayment. After 4 years when TOP, the kids can fund. If not get in now, it can be hard to get one especially when they want to get marry (and cannot apply for HDB).
For youngsters who earn above 15k, they can take position themselves buy getting a small unit.
Anyway, do u know when u buy BUC, u pay according to stages of completion. That's how many build their cash. Many way to invest, strategically with fallback.
Mr Loo, jut noticed your microphone. Sound quality is fantastic now.
Ha ha… I finally caught up with technology
Many of them get money from their parents especially for the upfront deposits. I used to visit showrooms and have heard multiple times of youngsters telling their father/mother 'daddy! I want this!', and the father keeps quiet. The kid then says 'you only pay the down payment, don't geow, the rest I pay leh!' I watched them in amazement. Firstly, these kid(s) have no shame, secondly the parents are horribly dumb. Ultimately when they cannot afford the mortgage payments, they will just sell the house for cheap and go stay with their parents again. By then, the parents would have no retirement funds and still have to feed their parasitic children.
It seems this is the case now that kids are living off parents
Lol.. that’s like less than 1%. I bought my condo as my first house last year with zero parental support
If have parasite kids, the parents have failed bringing them up. Unlikely they will have extra money, if have, then donate to stock markets before go go.
@@juniorjr5328 Very easy to calculate. If you are under 25 and yet able to afford a condo on your own it only means 3 things. Either you are 0.0001% of the population and a genius or strike lottery, or you are over paid or your family helped you reach this point. There is no other way.
Chances are you are not that 0.0001% of the population. So you are either foolishly over paid by some silly company or you are denying the truth that you family had helped. Imagine your parents don't exist, you grow up in an orphanage. You THINK you can afford to buy a condo? No way.
Mr Loo, u r only half right in your calculations. The interest rate can't be always at 3.5%. It may not be low like the past but it won't be 3.5% after 2024
Personally wrt CPF, I believe one needs to be convinced that "CPF is money cannot touch, better unlock" and all those other street talk.
Once tt is cleared up and leveraging the power of letting the SG Gov do the heavy lifting for u in investing, i think its a no brainer whether to use it or not.
It’s so true, over investing in assets is taking away from other areas of live. The recent chase after this asset has been unhealthy.
I have $100+k in my OA ready to be deployed to private property for part of down payment.
steady! pom P p...your dad + mum back u up..to fire the shots?
Too little, stay away first.
It is not suprising that the young are the biggest buyers of condos. The parents are the ones putting the downpayment for them. Mr Loo, you can also talk about people chasing car price.
Why worry for them if they have very rich parents with excess cash to support them? They won't even be able to pay for down-payment and qualfy for loan if they dont have the financial capability with TDSR in place.
Problem is the article says they mostly paid for the house without parental help
Many hope to sell after receiving the keys, renovate and sell at a high price making a huge profit. Not many wants to stay long term. Always have new neighbours for those condo owners.😅
Young people have time on their side to put the banks' money to work.
TBH, I really dunno how they can afford? Btw should ask gov to have a breakdown of the youngsters buy condo. Are they PR or locals?
Usually parents help with 300-500k for downpay.. some help 80% or fully pay for them
risk can take, but must have back up plans, and continuously managed and not on autopilot mode.
Parents support la.....they always have some money for deposite and such deposite not little ...sure they have some backup behind .
Some pple are just lucky. Buy what win what. Some buy what lose what. But always dont over commit
think for 1.5m loan need to make 200k yearly leh.
Else, can cash pledge $1mio, to secure mortgage.
If you want to be rich and achieve financial independence, you should start your own business. Relying on housing properties to attain financial independence in Singapore no longer works.
I like your statement boss, peers, subordinates can backstab you. Why local don't support local?
why worry for them ? they are their own making.
Most have their parents support. I have a few colleagues doing likewise for their kids.
Many young doing part time jobs like teaching tuition.. can earn $1k+ additional per month..
They have the money, their choice then just let them do it Lo.
These younger generation always depend on their rich parents for assistance buying properties. They have not gone through hardship and financial crisis.
@@choonhockong8215as far as I know, many a times, the parents are hunting and asking kids to use their names. We must not always think the kids r the suckers.
We parents should know, good kids dun need u, bad ones dun give them. So, it is all our doing to ride now, no one to blame :)
not sure if you check the background of these young people. Most of them are new citizens, with loads of cash from their parents. you can see many of them showing off on chinese social platform. Not the local people here.
The article mentioned the new home owners are mostly self funded
ya self funded from their parents from china ma@@1m65
U need to chk the stats published first.
I said "new citizen" right. new "pink IC"
@@leanne2330
Those who went through the phase seeing ECs selling at 700psf will find 1700psf ECs ridiculous.
If they buy to rent out still ok else they could have been using daddy or mummy's money like the recent report on an insurance agent borrowing from Mum when he was already making $20k? If out of pocket, then slave to the job.
Their parents are willing to help them financially.
Thats evidence its not about young salaries not being sufficient....
They r complaining abt not able to chase luxuries
I think the downpayment and even part of their mortgages are paid by their parents…best of both worlds
I bought my first freehold condo when i was 31 & that was 18 years ago
Some say they ‘duoa dhah’ (gutsy)…
Good advice. Mr Loo, what course are you sending your son to?
Technical analysis.
@1m65 Thank you Mr Loo
Great such courses, ive identified a triple bottom in China equities, we r seeing trend reversal.😊
Why the rich remain poor. True story.
BKS abbreviation "Bo Kia Xi" Very creative. Loving it. lol
I appreciate your sense of humour! Thank you for enjoying the video!
tbh must thank mommy and daddy for downpayment, this is not entirely due to merit if below 30-35 generally
Some parents buying under kids name
@@fool1124 yeah, ultimately they will need to discuss on more than just the name on paper. such as who gets the rent money if rented out etc.
Actually it is more than that. To buy a $1.5mio home, if u r low salary, u need cash pledge $1mio with bank to secure a loan for the youngster.
U talk about cpf 10years ago , hope that u don’t be right 10 years later for property
How ah. I bought condo as my first house as single
Bbq
Unless you bought a super lak gu (popular) condo, I wonder how much money one can make after deducting bank interest, MCST fees (especially you don't drive and use the facilities regularly)... etc
The banks wont give such high mortgage anyway. They dont want bad loans too.
They do
Nope. These are collateralized loans (backed by the property). They wouldn't mind a less than fully paid up loan. Worth the risk to bank to lend for property purchase.
Not true. HDB loan offered me 500-600k max. Bank loan offered me 1.7 mil. Diff is big
If banks are confident. So be it.
@@1m65not without cash/asset pledge.
Wipe jialat jialat
Parents Ang Bao to them
Financial literacy is weak generally for most public... can't be help.
Better be humble