GO UP

Don't rush into buying property. Consider these 7 factors first.

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As property sentiment goes bullish, pundits say there’s no better time to enter the market. In addition to considering location, future resale value and the timing of your purchase, it is important to survey your needs, finance plans, and long-term objectives before making a commitment.

BACKGROUND CHECK “A good starting point is URA’s website, where you can search for the condo you’re interested in and have a look at the price a similar unit has sold for over the past three years.” — Mr Willie Ooi, 52, real estate agent, C&H Properties Pte Ltd

FOOLS RUSH IN… “Most people buy under pressure or with a push from agents. It is important for buyers and sellers to know the market situation — past, current and future projections — to better facilitate their decision making. Get statistics to back up claims made by agents. A common mistake people make is emotional buying rather than rational buying, and doing enough research.” — Ms Tina Lee, division director, ERA Realty Network

THINK LONG-TERM “Before I bought my first condo, I studied the market for two years. Long-term planning is important if you want to get the best deal — consider how long you intend to live there, your family members’ changing needs, and whether your district will be undergoing further development. It’s important to assess how large a loan to take — across the years, no more than 40 per cent of your monthly income should go into serving your loan.” — Mr Shu Hua Xi, 55, property investor with 23 years’ experience

IS IT RIGHT FOR ME? “Figure out what you can’t do without and what are nice-to-haves. It’s important to work out if you are able to afford the monthly payments including all the extras. Don’t be afraid to ask questions and definitely shop around for the right apartment. I needed to educate myself on the financial and legal aspects of buying a property, how mortgages are structured and the different types of loans.” — Ms Clara Chua, consultant with NTUC LearningHub

INFO DEVELOPERS HAVE TO PROVIDE:

■ The condominium’s scaled location plan, site plan, and unit floor plan

■ Breakdown in strata area for strata-titled properties (e.g. area of bedroom, balcony, airconditioner ledge and void area)

■ Conditions and restrictions imposed by the authorities

■ Amendments to the Sale and Purchase Agreement

■ Specifications of the building

HOW MUCH SHOULD YOU BORROW?

■ Rough equation: Total budgeted monthly repayment = [Total household income] - [fixed expenses eg. bills and taxes] - [family commitments eg. costs of raising a child, taking care of elderly.] - [amount set aside for savings.]

■ Make calculations based on your age. If you’re in your 30s, you can roughly expect monthly repayments for the next 30 years. If you’re in your 50s, you can expect monthly repayments for the next 10 years

MONEY MATTERS: Knowing Estimated Breakdown of BASIC payment

Balance of purchase price (80%) - bank loan

Additional costs to consider: ■ Buyer Stamp Duty ■ Additional Buyer Stamp Duty ■ Legal Fee

Booking fee - option to purchase granted (5%) - cash

Balance down payment - After signing Sale and Purchase Agreement (15%) - cash/ CPF

This article was first published on The New Paper: Home Now.

TOPICS: property