WEBVTT - Is owning a second property in Singapore worth the cost?

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<v Speaker 1>You're listening to a CNA podcast.

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<v Speaker 2>Hey, this is Andrea Heng and I'm back with the

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<v Speaker 2>Money Talks podcast where we specialize in talking about money.

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<v Speaker 2>More importantly, all the things you can do with it.

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<v Speaker 2>So in the previous episode, we looked at how to

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<v Speaker 2>add resilience to our investment portfolio, especially with a looming

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<v Speaker 2>recession that dreaded our word. Go check out that episode

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<v Speaker 2>on Spotify or Apple podcasts. Will you?

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<v Speaker 2>Now our episode today focuses on a bigger longer term investment,

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<v Speaker 2>owning a second property. It's especially appealing to couples, for example,

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<v Speaker 2>who can choose to take advantage of two income streams

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<v Speaker 2>and turn it into another income generator by owning two properties, right?

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<v Speaker 2>But decoupling has also become a bit of a hot

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<v Speaker 2>button issue, especially with the new A BS D. That's

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<v Speaker 2>the additional buyer stamp duty and

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<v Speaker 2>that was announced in April of 20% for Singaporeans buying

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<v Speaker 2>a second property. Now, some of you might be wondering

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<v Speaker 2>what's decoupling. We'll get into that later. Trust me. So

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<v Speaker 2>is two truly better than one, what should we consider

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<v Speaker 2>before taking the plunge? And should we start thinking of

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<v Speaker 2>a second property as a form of inheritance for kids.

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<v Speaker 2>Let's take a look at some of our options. Now

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<v Speaker 2>with Clive Cheng of Red Brick

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<v Speaker 2>Advisory. Thank you for joining us on the Money Talks podcast. Clive,

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<v Speaker 2>thank you for having me. So, Clive in your line

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<v Speaker 2>of work. How many people have you encountered owning a

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<v Speaker 2>second property? Actually quite a few out of 10 inquiries.

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<v Speaker 2>And with, I mean, private property owners, maybe you get

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<v Speaker 2>30 40% of them. Wow. Yeah, thinking about owning a

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<v Speaker 2>second property. So whenever someone has a cash or they've

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<v Speaker 2>gotten a windfall from,

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<v Speaker 2>from their work through bonuses, I mean, the immediate thing

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<v Speaker 2>they always think about is I want to own a

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<v Speaker 2>second property and be a land. Yeah, exactly. Ok. So

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<v Speaker 2>what then become their biggest financial concerns when they are

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<v Speaker 2>considering buying that second property, it's always a matter of

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<v Speaker 2>getting the proper financing and trying to avoid as much

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<v Speaker 2>tax as possible, you know, trying to make the purchase

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<v Speaker 2>as streamlined as possible. So when we're talking about buying

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<v Speaker 2>a second property

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<v Speaker 2>in Singapore today, obviously additional buyer stamp duty becomes a

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<v Speaker 2>large topic because like you mentioned earlier, it was revised

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<v Speaker 2>to 20%. So if you're purchasing a million dollar property

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<v Speaker 2>and you have to pay $200,000 of additional buyer stamp

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<v Speaker 2>duty that really burns a hole in your pocket. So

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<v Speaker 2>couples are always thinking of ways to try to make

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<v Speaker 2>their purchases more efficient and that's when you mentioned, rightly

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<v Speaker 2>where this thing called decoupling comes into the picture.

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<v Speaker 2>Perhaps, let me explain a little bit more about that. So,

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<v Speaker 2>decoupling is a process where for example, husband and wife

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<v Speaker 2>owns a private property and now they want to own

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<v Speaker 2>another one. So the husband purchases over the wife's share, right?

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<v Speaker 2>Or vice versa, leaving the wife property less. Right? So

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<v Speaker 2>now that you don't own a property, you purchase your

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<v Speaker 2>own private property,

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<v Speaker 2>you won't have to pay for additional buyer stamp duty. Right? Yeah.

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<v Speaker 2>So if you are Singaporean citizen and you're buying your

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<v Speaker 2>first property, there's no additional buyer stamp duty. Ok. And

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<v Speaker 2>do they tend to be married? Couples do singles do

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<v Speaker 2>this or I guess, parent and child? Yeah, it can

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<v Speaker 2>be in any form of configuration most commonly they usually

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<v Speaker 2>husband and wife. Yeah.

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<v Speaker 2>But yeah, I've seen quite a few cases as well

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<v Speaker 2>where it's a parent and a child or even between

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<v Speaker 2>two friends, there are no restrictions to who can be couple. Ok.

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<v Speaker 2>Before anything else, I believe there are questions that we

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<v Speaker 2>need to ask ourselves as usual as part of our homework.

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<v Speaker 2>When considering buying a second property, I think it's best

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<v Speaker 2>to think about it in three ways. Ok.

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<v Speaker 2>Intent and eligibility. So let's talk about the first one

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<v Speaker 2>and arguably it's the most important affordability, right? What aspects

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<v Speaker 2>of our financial health do we need to look at

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<v Speaker 2>to determine if we can in fact, afford a second

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<v Speaker 2>home basically also what should our financial threshold be, for example.

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<v Speaker 2>So mes and the banks have put in regulations to

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<v Speaker 2>prevent someone from over leveraging. Now on the topic of

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<v Speaker 2>affordability commitments are usually the biggest thing that we think about, right,

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<v Speaker 2>how much you spend on your credit cards, whether you

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<v Speaker 2>own a car or multiple cars, whether you have personal loans,

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<v Speaker 2>all these commitments greatly impact the amount of loan you

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<v Speaker 2>can actually obtain from the banks when you're looking to

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<v Speaker 2>purchase a property. So affordability, if you're looking to purchase

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<v Speaker 2>a property, you would want to always make sure that

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<v Speaker 2>you keep your commitments to, you know,

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<v Speaker 2>a low, right? Make sure that in check, make sure

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<v Speaker 2>there are no late payments. You don't default on any,

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<v Speaker 2>any payments because that's what you mean by low, not

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<v Speaker 2>necessarily volume but just making sure you pay your bills

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<v Speaker 2>on time. Yeah, I mean volume does come into play

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<v Speaker 2>as well because if I have a car and the

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<v Speaker 2>monthly installments on the car is like $3000 a month,

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<v Speaker 2>that is going to substantially bring down your loan eligibility, right?

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<v Speaker 2>And if you also make late payments that would show up.

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<v Speaker 2>So whenever the banks determine your loan eligibility, they would

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<v Speaker 2>always run a credit bureau search that basically gives an

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<v Speaker 2>indication to the bank of your repayment history. So if

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<v Speaker 2>you've been late

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<v Speaker 2>on certain credit cards for like 30 or 60 days

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<v Speaker 2>doesn't look too good. And because of that, they may

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<v Speaker 2>impose some stricter conditions, like, instead of being able to

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<v Speaker 2>grant you the maximum of 75% loan, they probably say

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<v Speaker 2>I grant you 60%. What about thinking about time frames?

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<v Speaker 2>I mean, I don't want to be servicing a home

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<v Speaker 2>loan

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<v Speaker 2>well into my seventies and my eighties as well. Right.

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<v Speaker 2>Isn't that something to consider as well? Yeah. Well, the

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<v Speaker 2>cap today, I mean, if you're an investor, you would

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<v Speaker 2>actually think a little bit differently. You won't mind serving

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<v Speaker 2>the loan until you like at the age of 75

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<v Speaker 2>for example, and here's why. So when someone buys a

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<v Speaker 2>property today, the banks would always grant you a loan

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<v Speaker 2>tenure up to the age of 65. So for example,

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<v Speaker 2>if I'm 50 years old, I'll get a 15 year

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<v Speaker 2>loan tenure, right?

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<v Speaker 2>Some people get even imagine I'm 60 years old, for example,

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<v Speaker 2>extreme case, my loan tenant is five years and because

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<v Speaker 2>the loan tenant is five years, my monthly installments tend

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<v Speaker 2>to be quite high, right? And that eats a lot

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<v Speaker 2>into my cash flow. So some people will be like, hey, Clive,

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<v Speaker 2>I actually want to get a longer loan tenant, you know,

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<v Speaker 2>because if I can extend my loan tenant by 10

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<v Speaker 2>years from 5 to 15 years,

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<v Speaker 2>the commitments drop by more than 50% and it doesn't

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<v Speaker 2>hurt your cash flow. Yeah, so it's better for me

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<v Speaker 2>because the cash that I save can potentially be reinvested

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<v Speaker 2>into something that gives me a better return. Exactly right. So,

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<v Speaker 2>so there are a lot of considerations when you know,

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<v Speaker 2>deciding on how much loan you want to take, how

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<v Speaker 2>much CPF you want to use, how long of a

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<v Speaker 2>loan tenure you would like to take really depends on

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<v Speaker 2>the requirements at that point of time. But the good

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<v Speaker 2>thing is that, you know, you get to review your

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<v Speaker 2>mortgage portfolio every two or three years, it's necessary

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<v Speaker 2>and you can always make some changes along the way

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<v Speaker 2>in terms of like your loan tenure. Or if you're

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<v Speaker 2>looking to make a lump sum repayment, you can actually

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<v Speaker 2>basically refinance the mortgage. You have a lot of flexibility

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<v Speaker 2>when you refinance your mortgage. Ok? So there are also

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<v Speaker 2>certain laws and regulations that we need to consider when

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<v Speaker 2>working out affordability. Of course, I'm going to bring into

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<v Speaker 2>the picture. Now, the new A BS D and we

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<v Speaker 2>have to think about that in mind. There's something in

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<v Speaker 2>there about the A BS D

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<v Speaker 2>involved in the transference of property into a living trust, ok?

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<v Speaker 2>You need to average man this out for me like, ok,

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<v Speaker 2>so now let me start off by saying, ok, recently

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<v Speaker 2>the government has introduced this thing called an A BS

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<v Speaker 2>D trust. So if you're buying a trust, a property

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<v Speaker 2>under trust, you would have to pay for the additional

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<v Speaker 2>buyer of 35%. It's 35% now. So let's rewind this

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<v Speaker 2>a little bit

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<v Speaker 2>if I don't want to have to pay for additional

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<v Speaker 2>buyer stamp duty. When I, you know, buy multiple properties,

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<v Speaker 2>one of the ways of acquiring properties is through my

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<v Speaker 2>sons and my daughters. Of course, being of legal adult age,

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<v Speaker 2>you don't have to be, you don't necessarily, I can

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<v Speaker 2>even set up a trust for my kid who is

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<v Speaker 2>three years old. Oh, wow. Ok. Now, here's the thing

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<v Speaker 2>when you buy a property under trust

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<v Speaker 2>for someone who is a minor. Uh, the property, number one,

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<v Speaker 2>you can't take a loan on the property. The property

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<v Speaker 2>has to be fully paid for in cash. Ok, let's

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<v Speaker 2>assume a property purchase price of a million dollars. So

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<v Speaker 2>you buy a million dollars in cash. On top of that,

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<v Speaker 2>the government will charge you 35% additional buyer stamp duty. Now,

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<v Speaker 2>is there a way to get this 35% back? Yes,

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<v Speaker 2>that a win. Now, why is there even a 35% additional? Let's,

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<v Speaker 2>let's talk about that for a moment. Everyone likes to

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<v Speaker 2>find loopholes when it comes to investing in the property market. Absolutely.

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<v Speaker 2>And in the past, there have been people who have

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<v Speaker 2>bought properties under the kids name under trust and when

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<v Speaker 2>the property has appreciated in its value, they sell off

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<v Speaker 2>the property

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<v Speaker 2>when it's actually meant for the kid. So they purchase

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<v Speaker 2>a property for an investment under the disguise that I

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<v Speaker 2>would like to buy this for my kid in future.

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<v Speaker 2>And that's perfectly legal in the past. So of course,

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<v Speaker 2>it's going to be a problem because, you know, you

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<v Speaker 2>get a lot of rich Singaporeans or even pr or

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<v Speaker 2>foreigners buying, stepping up properties because they have a lot

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<v Speaker 2>of cash and then just flipping it when the time

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<v Speaker 2>is right. So now this the government because of this

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<v Speaker 2>has imposed this 35%. Ok. If you want to do this,

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<v Speaker 2>you pay an additional, I mean, if you can afford

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<v Speaker 2>a million dollars in cash, you can't afford another 350 K. Yeah,

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<v Speaker 2>you might be right. But I mean when it comes

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<v Speaker 2>to that level, you know, do you think it's been

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<v Speaker 2>effective though? It has so, so paying another 35% and

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<v Speaker 2>we're not talking about, you know, a million dollar purchase,

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<v Speaker 2>usually the purchases tend to be a bit larger of

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<v Speaker 2>234 million number paying 35% of that is going to

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<v Speaker 2>be painful, right? So

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<v Speaker 2>they've put in place this additional bias and duty, but

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<v Speaker 2>there is a way of getting it back provided that

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<v Speaker 2>you fulfill certain requirements, right? So the requirements for example

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<v Speaker 2>would be, oh, ok, you cannot sell the property, you

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<v Speaker 2>cannot be the one selling of the property, the property

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<v Speaker 2>has to be left for your kid, right? You cannot

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<v Speaker 2>make and you cannot put it

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<v Speaker 2>any additional clauses saying that, ok, I still have the

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<v Speaker 2>power to sell away the property, for example, because it

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<v Speaker 2>is technically not yours. Yeah, exactly. So I won't go

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<v Speaker 2>into the real technical details. I think that can be

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<v Speaker 2>found online as well. But there are certain requirements have

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<v Speaker 2>been set up to ensure that in the bid to

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<v Speaker 2>ensure that you are just

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<v Speaker 2>legitimately buying this property and leaving it for your kid

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<v Speaker 2>and not any other funny business, but you can prove

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<v Speaker 2>that that's the case. You will get your 35% back. Wow,

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<v Speaker 2>talk to us also about the taxes involved and using

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<v Speaker 2>CPF for your second property. Yeah. Ok, great. So now

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<v Speaker 2>assuming that I intend to hold the first property and

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<v Speaker 2>continue to purchase the second property. So it's a second

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<v Speaker 2>property that I'm going to own under my own name. Now,

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<v Speaker 2>number one,

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<v Speaker 2>if I have an existing mortgage on property, number one,

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<v Speaker 2>and now I'm looking to get a mortgage on property.

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<v Speaker 2>Number two, the maximum loan the banks will grant me

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<v Speaker 2>is only 45% right? So we have to take note

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<v Speaker 2>of that. Whereas when you buy a first property, you

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<v Speaker 2>can get a maximum loan of 75%. So that's additional

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<v Speaker 2>cash that you have to come up with. That's number one,

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<v Speaker 2>number two, if I intend to use CPF on the

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<v Speaker 2>second property

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<v Speaker 2>and I have already used CPF on the first property.

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<v Speaker 2>That's a limitation as to how much CPF I can

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<v Speaker 2>actually use. Right. I have to set aside to make

0:11:39.169 --> 0:11:41.799
<v Speaker 2>sure that I have the basic retirement sum. That's right

0:11:41.809 --> 0:11:44.270
<v Speaker 2>in the O A and the A combined and anything

0:11:44.280 --> 0:11:46.669
<v Speaker 2>in excess of that I can then deploy in my

0:11:46.679 --> 0:11:50.059
<v Speaker 2>second property because it's technically seen as an investment. You

0:11:50.070 --> 0:11:52.109
<v Speaker 2>would do the same with your investment money, right? In

0:11:52.119 --> 0:11:55.520
<v Speaker 2>your CPF. Ok. Ok. So when it comes to buying

0:11:55.530 --> 0:11:57.570
<v Speaker 2>a second property, you would realize because of the

0:11:57.640 --> 0:12:01.750
<v Speaker 2>lower loan to valuation and the lower amount of CPF usage,

0:12:01.760 --> 0:12:03.760
<v Speaker 2>you tend to have to come up with a lot

0:12:03.770 --> 0:12:07.460
<v Speaker 2>of cash adding on to that. Besides your regular buyer

0:12:07.469 --> 0:12:10.219
<v Speaker 2>stamp duty, you would have to pay for additional buyer,

0:12:10.229 --> 0:12:12.569
<v Speaker 2>stamp duty as well. 20% if you are a Singapore

0:12:12.580 --> 0:12:16.450
<v Speaker 2>and it gets higher if you are apr Oh yeah, definitely. 20%

0:12:16.460 --> 0:12:19.729
<v Speaker 2>is like the already in the second property. Yeah. So

0:12:19.739 --> 0:12:21.718
<v Speaker 2>you would have to fork out quite a fair bit

0:12:21.729 --> 0:12:25.309
<v Speaker 2>of cash you realize on the second property itself, right?

0:12:25.530 --> 0:12:27.789
<v Speaker 2>So, and that's the reason why, you know, people are

0:12:27.799 --> 0:12:31.359
<v Speaker 2>embarking on if they have an opportunity to decouple on the,

0:12:31.369 --> 0:12:34.099
<v Speaker 2>on the right? Ok. That makes a whole lot of sense. Yeah.

0:12:34.109 --> 0:12:35.950
<v Speaker 2>But if you are a single owner and you're looking

0:12:35.960 --> 0:12:38.630
<v Speaker 2>to purchase the second one, I'm sorry. I mean, those

0:12:38.640 --> 0:12:41.039
<v Speaker 2>are the options either if you, if you're looking to

0:12:41.349 --> 0:12:44.479
<v Speaker 2>you know, leverage at the maximum loan because sometimes if

0:12:44.489 --> 0:12:46.559
<v Speaker 2>I own a condo under my sole name and let's

0:12:46.570 --> 0:12:48.098
<v Speaker 2>say I've been owning it for a few years now,

0:12:48.109 --> 0:12:48.880
<v Speaker 2>my outstanding

0:12:48.950 --> 0:12:51.039
<v Speaker 2>loan might have come down quite a fair bit. Right.

0:12:51.049 --> 0:12:54.150
<v Speaker 2>I may consider just paying off the loan on my

0:12:54.159 --> 0:12:56.640
<v Speaker 2>first property. So that on property number two, I can

0:12:56.650 --> 0:13:00.569
<v Speaker 2>leverage at 75%. Got it. Yeah, that's a smart move.

0:13:00.700 --> 0:13:03.159
<v Speaker 2>So another financial assessment that we need to think about

0:13:03.169 --> 0:13:07.919
<v Speaker 2>is thresholds because I mean property here is notoriously expensive

0:13:07.929 --> 0:13:11.079
<v Speaker 2>and all those really strict rules and regulations and limitations

0:13:11.090 --> 0:13:12.299
<v Speaker 2>that you were just talking about.

0:13:12.500 --> 0:13:17.130
<v Speaker 2>So second homes are not always attainable to many of us.

0:13:17.520 --> 0:13:22.429
<v Speaker 2>So what should our financial threshold be in the first place? Ok,

0:13:22.590 --> 0:13:27.429
<v Speaker 2>so let's talk about eligibility, right? Whenever you purchase a property,

0:13:27.440 --> 0:13:30.619
<v Speaker 2>let's talk about a private property, you immediately get subjected

0:13:30.630 --> 0:13:34.599
<v Speaker 2>to this thing called the total debt servicing ratio. Sr right,

0:13:34.729 --> 0:13:35.809
<v Speaker 2>simply put it,

0:13:36.119 --> 0:13:41.689
<v Speaker 2>your total commitments cannot exceed 55% of your total income.

0:13:41.830 --> 0:13:46.089
<v Speaker 2>So for instance, if I'm earning $10,000 a month, my

0:13:46.099 --> 0:13:49.440
<v Speaker 2>entire liabilities including the property or whatever car loans or

0:13:49.450 --> 0:13:54.329
<v Speaker 2>personal loans, I have cannot exceed $5500. Right? So if

0:13:54.340 --> 0:13:56.109
<v Speaker 2>I'm looking to buy a second property

0:13:56.510 --> 0:13:59.919
<v Speaker 2>and I already have an existing mortgage that eats into

0:13:59.929 --> 0:14:03.059
<v Speaker 2>my 55% of course, and let's say I only have

0:14:03.090 --> 0:14:06.020
<v Speaker 2>$1000 left, right. To be able to obtain a mortgage.

0:14:06.030 --> 0:14:08.460
<v Speaker 2>I would realize that I actually can't borrow much from

0:14:08.469 --> 0:14:11.030
<v Speaker 2>the bank. Yeah, a lot. Yeah. So either I have

0:14:11.039 --> 0:14:12.848
<v Speaker 2>a lot of cash, you know, to throw into the

0:14:12.859 --> 0:14:15.440
<v Speaker 2>property or because of my loan is small or

0:14:15.880 --> 0:14:21.799
<v Speaker 2>I embark of maybe purchasing commercial properties instead because commercial properties,

0:14:22.039 --> 0:14:24.559
<v Speaker 2>the regulations are a little bit different as compared to

0:14:24.570 --> 0:14:28.979
<v Speaker 2>residential properties, you still can get 70 or 75% loan

0:14:28.989 --> 0:14:31.200
<v Speaker 2>if you own a residential property and you're looking to

0:14:31.210 --> 0:14:35.809
<v Speaker 2>buy a commercial property and commercial properties doesn't come with

0:14:35.820 --> 0:14:40.039
<v Speaker 2>additional buyer stamp duty. Yeah, so that's usually when you

0:14:40.049 --> 0:14:44.469
<v Speaker 2>have an investor who has maximized their residential portfolio,

0:14:44.679 --> 0:14:48.469
<v Speaker 2>then you would realize they start moving into the commercial space. Ok.

0:14:48.479 --> 0:14:52.880
<v Speaker 2>So that brings us to our next consideration intent. So

0:14:52.890 --> 0:14:55.200
<v Speaker 2>what questions do we need to ask ourselves with regard

0:14:55.210 --> 0:14:59.049
<v Speaker 2>to the purpose, the objective, the goal of buying a

0:14:59.059 --> 0:15:04.169
<v Speaker 2>second property is passive income. The only reason worth doing it. Well,

0:15:04.179 --> 0:15:07.039
<v Speaker 2>that's usually the first thing that people think about, but

0:15:07.049 --> 0:15:09.710
<v Speaker 2>we always have to remember. Yes, you are

0:15:09.796 --> 0:15:12.866
<v Speaker 2>a landlord. Your tenant is paying you, but you have

0:15:12.875 --> 0:15:16.536
<v Speaker 2>to make your monthly mortgage payments. So if your monthly

0:15:16.546 --> 0:15:21.486
<v Speaker 2>mortgage payments are $5000 and your tenant is paying you 5005,

0:15:21.495 --> 0:15:24.726
<v Speaker 2>your passive income is $500 every month. And, and that is,

0:15:24.736 --> 0:15:30.366
<v Speaker 2>and we haven't also considered property taxes, maintenance fees, for example.

0:15:30.375 --> 0:15:33.135
<v Speaker 2>So you might end up with a negative cash flow

0:15:33.145 --> 0:15:34.726
<v Speaker 2>even though you're a landlord.

0:15:34.911 --> 0:15:37.081
<v Speaker 2>So that's not the only thing that one would consider

0:15:37.091 --> 0:15:40.442
<v Speaker 2>when purchasing a second property to get passive income. We

0:15:40.452 --> 0:15:43.921
<v Speaker 2>are also looking at capital appreciation, right? You buy a

0:15:43.932 --> 0:15:46.921
<v Speaker 2>property now or you buy a property when it's new

0:15:46.932 --> 0:15:50.710
<v Speaker 2>after five years, most probably the property is appreciated in

0:15:50.721 --> 0:15:53.481
<v Speaker 2>its value. And then you sell and then you realize

0:15:53.492 --> 0:15:56.202
<v Speaker 2>the returns after that and if you get a positive

0:15:56.211 --> 0:15:59.211
<v Speaker 2>cash flow on your tenancy, great, right. Good for you.

0:15:59.221 --> 0:15:59.942
<v Speaker 2>That's a bonus,

0:16:00.200 --> 0:16:02.570
<v Speaker 2>but you're not just going to ride off how much

0:16:02.580 --> 0:16:05.400
<v Speaker 2>you're getting in terms of your, your rental and just

0:16:05.409 --> 0:16:08.190
<v Speaker 2>bank on that in making an investment decision, you always

0:16:08.200 --> 0:16:10.559
<v Speaker 2>want a greater upside. So that's the other upside, you know,

0:16:10.570 --> 0:16:12.190
<v Speaker 2>capital appreciation.

0:16:12.599 --> 0:16:14.770
<v Speaker 2>And I mean, if you're owning a property in Singapore,

0:16:14.780 --> 0:16:18.750
<v Speaker 2>chances are the property would retain its value. You wouldn't

0:16:18.760 --> 0:16:22.359
<v Speaker 2>see property prices just come crashing down. So to many

0:16:22.369 --> 0:16:24.729
<v Speaker 2>people that is like a safe bet, you know, uh

0:16:24.739 --> 0:16:28.330
<v Speaker 2>as compared to putting my money into the equities market

0:16:28.340 --> 0:16:31.200
<v Speaker 2>and you know, the Cryptocurrency market. So, so that's a

0:16:31.210 --> 0:16:34.530
<v Speaker 2>different thing altogether. But yeah, I think that's the consideration,

0:16:34.539 --> 0:16:36.849
<v Speaker 2>the intent cannot just be purely ok. I just want

0:16:36.859 --> 0:16:39.750
<v Speaker 2>to get passive income, but you're thinking longer term, fine.

0:16:39.840 --> 0:16:41.950
<v Speaker 2>Five years, seven years. What are you gonna do with that?

0:16:41.960 --> 0:16:45.010
<v Speaker 2>As if I'm going to dispose of that asset how

0:16:45.020 --> 0:16:47.239
<v Speaker 2>much am I going to get in return? Right. And

0:16:47.250 --> 0:16:50.179
<v Speaker 2>if you analyze it, am I getting 2 3% per

0:16:50.190 --> 0:16:53.400
<v Speaker 2>annum or am I able to get 6 7%? Because

0:16:53.409 --> 0:16:56.179
<v Speaker 2>if I'm only gonna get 2 3% I may be

0:16:56.190 --> 0:16:58.619
<v Speaker 2>better off also trying to diversify and put my money

0:16:58.630 --> 0:17:00.919
<v Speaker 2>into different. Exactly. I mean, from what you're saying, it

0:17:00.929 --> 0:17:02.929
<v Speaker 2>really feels as if we need to look at it

0:17:02.940 --> 0:17:06.989
<v Speaker 2>as we look at any portfolio asset in there.

0:17:10.119 --> 0:17:13.119
<v Speaker 2>Hello, my name is Steve and I'm Theresa Tang and

0:17:13.130 --> 0:17:16.619
<v Speaker 2>we are the hosts of CNN correspondent, a podcast that

0:17:16.630 --> 0:17:19.609
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0:17:46.849 --> 0:17:50.760
<v Speaker 2>Ok. So here's what I understand. Some people say that

0:17:50.770 --> 0:17:54.020
<v Speaker 2>you can afford to and want to leave your child

0:17:54.030 --> 0:17:57.869
<v Speaker 2>with an inheritance. It's best to buy a second home now,

0:17:57.880 --> 0:18:02.349
<v Speaker 2>while prices are relatively within reach, what do we need

0:18:02.359 --> 0:18:04.849
<v Speaker 2>to know before we secure property for our Children? We

0:18:04.859 --> 0:18:09.550
<v Speaker 2>touched on this briefly from the trust point of view.

0:18:09.560 --> 0:18:11.479
<v Speaker 2>What what else do we need to think about?

0:18:11.920 --> 0:18:13.910
<v Speaker 2>I think at the end of the day you must

0:18:13.920 --> 0:18:16.369
<v Speaker 2>have a will set up. Yeah. I mean, that's important

0:18:16.380 --> 0:18:18.739
<v Speaker 2>because if I purchase a second property and I'm not

0:18:18.750 --> 0:18:20.849
<v Speaker 2>buying it under the trust because I'm not rich enough

0:18:20.859 --> 0:18:23.300
<v Speaker 2>to buy a property fully in cash. And I buy

0:18:23.310 --> 0:18:25.699
<v Speaker 2>a second property today. If I'm going to leave it

0:18:25.709 --> 0:18:28.329
<v Speaker 2>for my kids. Number one, I need to make sure

0:18:28.339 --> 0:18:30.060
<v Speaker 2>that I have a w will set up. Oh, yeah, yeah,

0:18:30.069 --> 0:18:31.790
<v Speaker 2>because if I don't have a will then, you know,

0:18:31.800 --> 0:18:31.909
<v Speaker 2>the

0:18:31.979 --> 0:18:36.180
<v Speaker 2>it it gets distributed to people who I may not

0:18:36.189 --> 0:18:38.139
<v Speaker 2>have the intent to, you know, in the first place,

0:18:38.150 --> 0:18:40.869
<v Speaker 2>have them have the property, so have a will set

0:18:40.880 --> 0:18:43.750
<v Speaker 2>up most importantly as well. I think get insurance if

0:18:43.760 --> 0:18:46.849
<v Speaker 2>you buy a second property and you know, halfway through you,

0:18:46.859 --> 0:18:49.680
<v Speaker 2>you meet up with a life changing accident or worst

0:18:49.689 --> 0:18:51.969
<v Speaker 2>case scenario, you no longer on the face of the planet,

0:18:52.290 --> 0:18:54.540
<v Speaker 2>what's going to happen to the mortgage, right? If, if

0:18:54.550 --> 0:18:58.819
<v Speaker 2>your kid inherits the property with the mortgage, you know,

0:18:58.829 --> 0:19:00.770
<v Speaker 2>that's going to be an issue as well. So a

0:19:00.780 --> 0:19:02.959
<v Speaker 2>lot of people tend to forget this and I've seen

0:19:02.969 --> 0:19:06.020
<v Speaker 2>many cases like that too where, you know, owners buy

0:19:06.030 --> 0:19:07.910
<v Speaker 2>a second property with the intent to, you know, oh,

0:19:07.920 --> 0:19:10.540
<v Speaker 2>you know, when my kids grow older, they can eventually,

0:19:10.599 --> 0:19:12.319
<v Speaker 2>I will eventually give them the property,

0:19:12.560 --> 0:19:14.389
<v Speaker 2>have them transfer under the name if they want to

0:19:14.400 --> 0:19:18.859
<v Speaker 2>sell it. But sometimes sad cases, I've seen them quite

0:19:18.869 --> 0:19:23.020
<v Speaker 2>a few where the main sole breadwinner passes on. Right,

0:19:23.329 --> 0:19:26.790
<v Speaker 2>the property gets down to, for example, like the spouse

0:19:26.800 --> 0:19:29.239
<v Speaker 2>in this instance, for example, but the spouse is not

0:19:29.250 --> 0:19:34.089
<v Speaker 2>working and there's a mortgage on the property, there is

0:19:34.099 --> 0:19:37.890
<v Speaker 2>no insurance. So the wife is left burden in this

0:19:37.900 --> 0:19:40.770
<v Speaker 2>case with a second property. I mean, of course, you know,

0:19:40.780 --> 0:19:41.829
<v Speaker 2>you can sell it off. But

0:19:41.915 --> 0:19:44.064
<v Speaker 2>in the meantime, if you fail to meet the payment,

0:19:44.074 --> 0:19:45.915
<v Speaker 2>I mean, the mortgage is still running and that you

0:19:45.925 --> 0:19:48.635
<v Speaker 2>don't sell a house overnight. Exactly. So if you want

0:19:48.645 --> 0:19:51.765
<v Speaker 2>to think of inheritance, you've probably got that thing holistically,

0:19:51.775 --> 0:19:54.964
<v Speaker 2>get a will set up and ensure that you have insurance, right?

0:19:55.114 --> 0:19:57.055
<v Speaker 2>So all these things are not like, oh, buying a property,

0:19:57.064 --> 0:19:58.755
<v Speaker 2>real estate, we just talk about real estate. You really

0:19:58.765 --> 0:20:00.405
<v Speaker 2>have to think about the whole picture

0:20:00.699 --> 0:20:02.750
<v Speaker 2>when you're planning for the, you know, if you're living

0:20:02.760 --> 0:20:05.669
<v Speaker 2>a property to your kids. No, that, that's fantastic advice.

0:20:05.680 --> 0:20:08.949
<v Speaker 2>It's very easy to get caught up in the moment of, oh, hey, ok,

0:20:08.959 --> 0:20:11.239
<v Speaker 2>here's my windfall. I'm going to go and invest in

0:20:11.250 --> 0:20:12.550
<v Speaker 2>this second piece of property.

0:20:12.819 --> 0:20:14.869
<v Speaker 2>Let's go buy one and then you don't think about

0:20:14.880 --> 0:20:17.310
<v Speaker 2>the longer term impact of what that's going to be

0:20:17.319 --> 0:20:20.280
<v Speaker 2>like when you pass it on. What kind of property

0:20:20.290 --> 0:20:25.329
<v Speaker 2>specifically should we be looking at for investment versus a

0:20:25.339 --> 0:20:28.290
<v Speaker 2>second home to love and to have a child. I

0:20:28.300 --> 0:20:31.099
<v Speaker 2>think it's really different kind of requirements because if you're

0:20:31.109 --> 0:20:34.629
<v Speaker 2>looking at purchasing a home you need to look at. Oh,

0:20:34.640 --> 0:20:37.708
<v Speaker 2>do I like the view? Do you like my neighbors?

0:20:37.719 --> 0:20:38.369
<v Speaker 2>Do you like the community?

0:20:38.890 --> 0:20:41.739
<v Speaker 2>Yeah. Is the development, you know, like some developments, a

0:20:41.750 --> 0:20:44.739
<v Speaker 2>lot of experts are attracted to certain developments. Oh, and

0:20:44.750 --> 0:20:47.380
<v Speaker 2>I like that feel, you know, is it convenient to

0:20:47.390 --> 0:20:49.869
<v Speaker 2>the bus stops and the M RT stations? But when

0:20:49.880 --> 0:20:53.169
<v Speaker 2>you're buying a property for investment, primarily, you're just looking

0:20:53.180 --> 0:20:56.400
<v Speaker 2>at the numbers as well. Is it easy to rent out?

0:20:56.550 --> 0:20:58.930
<v Speaker 2>How many rentals are there in a year if I

0:20:58.939 --> 0:21:01.589
<v Speaker 2>lose my tenant today? How fast am I able to

0:21:01.599 --> 0:21:04.680
<v Speaker 2>find another tenant for the replacement rate? Is it going

0:21:04.689 --> 0:21:04.879
<v Speaker 2>to be?

0:21:04.959 --> 0:21:06.250
<v Speaker 2>Of course, you know, if you're, if you're near an

0:21:06.260 --> 0:21:08.739
<v Speaker 2>M RT or good because, you know, if you sell it,

0:21:08.750 --> 0:21:11.670
<v Speaker 2>chances are you sell it at a slightly nicer price,

0:21:11.800 --> 0:21:14.139
<v Speaker 2>but the considerations are quite different. You're primarily looking at

0:21:14.150 --> 0:21:17.170
<v Speaker 2>the numbers right to decide whether you would move into

0:21:17.180 --> 0:21:20.569
<v Speaker 2>that particular development or not, whether it's ability to basically

0:21:20.579 --> 0:21:23.270
<v Speaker 2>appreciate in capital. Whereas like I said, if you're buying

0:21:23.280 --> 0:21:25.020
<v Speaker 2>a home, you may just like it, but 10 years

0:21:25.030 --> 0:21:27.479
<v Speaker 2>down the road, you may not make a lot of money. Yeah. Yeah,

0:21:27.489 --> 0:21:29.419
<v Speaker 2>I mean, I think if you're going in with the

0:21:29.430 --> 0:21:30.949
<v Speaker 2>objective of living there,

0:21:31.489 --> 0:21:34.819
<v Speaker 2>then it shouldn't bother you too much Well, Singaporeans, when

0:21:34.829 --> 0:21:37.949
<v Speaker 2>we always ask this question, we are too pragmatic for, oh,

0:21:37.989 --> 0:21:40.130
<v Speaker 2>you buy your own home? Yes. But I also like

0:21:40.140 --> 0:21:43.188
<v Speaker 2>to have it as a good investment. You cannot have

0:21:43.199 --> 0:21:45.050
<v Speaker 2>your cake and eat it all the time. I mean,

0:21:45.060 --> 0:21:48.410
<v Speaker 2>are there properties like that that meet the requirements of

0:21:48.420 --> 0:21:50.938
<v Speaker 2>you calling it a home and also having, having it

0:21:50.949 --> 0:21:52.920
<v Speaker 2>a good investment? I mean, there are some properties like

0:21:52.930 --> 0:21:53.560
<v Speaker 2>that as well.

0:21:53.810 --> 0:21:57.040
<v Speaker 2>But yeah, generally if you're looking like an investment property,

0:21:57.050 --> 0:22:01.579
<v Speaker 2>um chances are, you know, unless the requirements coincide with

0:22:01.589 --> 0:22:04.270
<v Speaker 2>that property then great. But otherwise the requirements are the

0:22:04.280 --> 0:22:07.270
<v Speaker 2>properties you're gonna get are quite different. Sure. Sure. Ok. Right.

0:22:07.280 --> 0:22:09.708
<v Speaker 2>So if the second property is then a piece of

0:22:09.719 --> 0:22:12.359
<v Speaker 2>investment purely versus the second home,

0:22:12.819 --> 0:22:15.159
<v Speaker 2>should we think about an exit plan? You talked about

0:22:15.170 --> 0:22:18.339
<v Speaker 2>this in terms of asset disposal, right? So what should

0:22:18.349 --> 0:22:21.919
<v Speaker 2>this exit plan look like? Yes, it's an important point

0:22:21.930 --> 0:22:24.800
<v Speaker 2>that you just brought up a lot of people purchase

0:22:24.810 --> 0:22:28.260
<v Speaker 2>a property not knowing when to exit, right. They may

0:22:28.270 --> 0:22:30.869
<v Speaker 2>have like a vague plan like, ok, I think, but

0:22:30.880 --> 0:22:33.060
<v Speaker 2>they always say, ok, client, whenever it hits this value,

0:22:33.069 --> 0:22:36.099
<v Speaker 2>I just sell it right? So simple. But thinking we

0:22:36.109 --> 0:22:37.660
<v Speaker 2>have to think deeper than that, we have to come

0:22:37.670 --> 0:22:39.250
<v Speaker 2>up with our cash flow as well because

0:22:39.650 --> 0:22:41.770
<v Speaker 2>now along the way, let's say you buy a property

0:22:41.780 --> 0:22:44.639
<v Speaker 2>and the kind of rental that you're getting is not fantastic.

0:22:44.650 --> 0:22:47.198
<v Speaker 2>And interest rates right now in the market are quite high,

0:22:47.349 --> 0:22:48.920
<v Speaker 2>you have to fork out quite a bit of cash.

0:22:49.229 --> 0:22:51.760
<v Speaker 2>So all these are expenses, right? And if you sell

0:22:51.770 --> 0:22:53.979
<v Speaker 2>the property five years later at a certain price, let's

0:22:53.989 --> 0:22:56.239
<v Speaker 2>say at a 10% gain, 20% gain.

0:22:57.079 --> 0:22:59.609
<v Speaker 2>If you do the math, you may not get a

0:22:59.619 --> 0:23:01.400
<v Speaker 2>lot of returns at the end of the day. Right?

0:23:01.579 --> 0:23:04.930
<v Speaker 2>So it's important to at the get go plan. Ok,

0:23:04.939 --> 0:23:08.270
<v Speaker 2>if I buy this property, have my cash flow ready,

0:23:08.339 --> 0:23:11.510
<v Speaker 2>what kind of expected rental am I going to get? Yes.

0:23:11.660 --> 0:23:12.189
<v Speaker 2>What is my

0:23:12.275 --> 0:23:16.714
<v Speaker 2>maintenance fee? What is my property taxes? Especially property taxes?

0:23:16.724 --> 0:23:18.515
<v Speaker 2>You know, because they're going to basically what your outflow

0:23:18.525 --> 0:23:22.754
<v Speaker 2>is exactly. Consider all your outflows, factor them into part

0:23:22.765 --> 0:23:25.214
<v Speaker 2>of the expenses and then you plan. Ok, if I

0:23:25.224 --> 0:23:27.604
<v Speaker 2>exit after five years, what is a realistic

0:23:27.959 --> 0:23:31.329
<v Speaker 2>amount I can sell my property yet? Based on current trends. So, ok,

0:23:31.339 --> 0:23:34.949
<v Speaker 2>let's do a two or three or maybe 4% appreciation

0:23:34.959 --> 0:23:36.819
<v Speaker 2>per year and we sell it after five years at

0:23:36.829 --> 0:23:40.540
<v Speaker 2>this price. Work the numbers out plan ahead and say, ok,

0:23:40.550 --> 0:23:42.020
<v Speaker 2>if I sell it at this price, what kind of

0:23:42.030 --> 0:23:44.409
<v Speaker 2>returns am I gonna get? A lot of people fail

0:23:44.420 --> 0:23:47.369
<v Speaker 2>to do this? Everyone is just drawn into the hype of. Oh,

0:23:47.380 --> 0:23:50.530
<v Speaker 2>it's a new launch. Sure. Make money. Yeah, exactly. My first,

0:23:50.540 --> 0:23:51.219
<v Speaker 2>my first because

0:23:51.594 --> 0:23:53.045
<v Speaker 2>one is buying I can't get a queue number. I

0:23:53.055 --> 0:23:56.505
<v Speaker 2>better just four more, four more, four more, but not

0:23:56.515 --> 0:23:59.145
<v Speaker 2>all new launches do well. Right. As we've seen in

0:23:59.155 --> 0:24:02.584
<v Speaker 2>the headlines and you may not at the end of

0:24:02.594 --> 0:24:05.313
<v Speaker 2>the day, make money from, from this investment if you

0:24:05.324 --> 0:24:08.005
<v Speaker 2>haven't really done the numbers. No, you're absolutely right. You're

0:24:08.015 --> 0:24:10.984
<v Speaker 2>hitting the nail on the head right there. So we

0:24:10.994 --> 0:24:15.165
<v Speaker 2>talked about decoupling earlier and I loved your explanation of decoupling.

0:24:15.395 --> 0:24:18.515
<v Speaker 2>So now I read that a factor to consider when

0:24:18.525 --> 0:24:19.784
<v Speaker 2>it comes to decoupling.

0:24:19.979 --> 0:24:21.709
<v Speaker 2>And of course, before you go ahead and buy the

0:24:21.719 --> 0:24:25.500
<v Speaker 2>second property is the type of holding or the type

0:24:25.510 --> 0:24:30.619
<v Speaker 2>of tenancy. Ok. Help me understand this. Ok. So we

0:24:30.630 --> 0:24:33.669
<v Speaker 2>call this the manner of holding. Now, basically, let's say

0:24:33.680 --> 0:24:36.800
<v Speaker 2>you're buying a property with your spouse or a friend. Ok.

0:24:36.810 --> 0:24:38.869
<v Speaker 2>So two, at least two parties involved,

0:24:39.640 --> 0:24:42.800
<v Speaker 2>you can buy the property under two different ways. You

0:24:42.810 --> 0:24:45.660
<v Speaker 2>can buy it under joint tenancy or you can buy

0:24:45.670 --> 0:24:48.339
<v Speaker 2>it under this thing called the tenancy in common. Ok?

0:24:48.619 --> 0:24:51.709
<v Speaker 2>So now let's assume me and my wife, we purchase

0:24:51.719 --> 0:24:54.229
<v Speaker 2>a property and we hold it in joint tenancies. So

0:24:54.239 --> 0:24:57.198
<v Speaker 2>joint tenancy just means we own equal shares. Now, the

0:24:57.209 --> 0:25:00.290
<v Speaker 2>deeper meaning behind the joint tenancy is if I pass

0:25:00.300 --> 0:25:03.939
<v Speaker 2>away my shares automatically go to my wife, right? She

0:25:03.949 --> 0:25:07.250
<v Speaker 2>inherits the property. It's a rule of survivorship.

0:25:07.650 --> 0:25:09.718
<v Speaker 2>Now, there is another way of holding it, which is

0:25:09.729 --> 0:25:12.920
<v Speaker 2>in tenancy in common and tenancy in common allows us

0:25:12.930 --> 0:25:15.949
<v Speaker 2>to alter the percentage that we hold in the property.

0:25:16.150 --> 0:25:18.689
<v Speaker 2>Can it still be 50 50? Of course, it can,

0:25:18.699 --> 0:25:22.109
<v Speaker 2>so I can hold the property in a tenancy in common. 50%

0:25:22.119 --> 0:25:24.900
<v Speaker 2>with my wife and 50% myself. And what happens if

0:25:24.910 --> 0:25:27.688
<v Speaker 2>I pass away if I pass away my stress get

0:25:27.699 --> 0:25:31.909
<v Speaker 2>distributed according to my will, it, it doesn't automatically go

0:25:31.979 --> 0:25:34.239
<v Speaker 2>to right now. That's one thing.

0:25:34.520 --> 0:25:36.739
<v Speaker 2>The second thing that usually people talk about when it

0:25:36.750 --> 0:25:40.219
<v Speaker 2>comes to manner of holding more commonly heard as 99

0:25:40.229 --> 0:25:45.339
<v Speaker 2>1 this term. What is this entire 99 demystify this

0:25:45.349 --> 0:25:47.130
<v Speaker 2>for me, please? Ok. So here it goes,

0:25:48.089 --> 0:25:50.780
<v Speaker 2>I own the property with my wife in equal shares.

0:25:50.790 --> 0:25:54.689
<v Speaker 2>The property is worth a million dollars today. Now I

0:25:54.699 --> 0:25:57.109
<v Speaker 2>want to perform a decoupling where I buy my wife's

0:25:57.119 --> 0:26:01.119
<v Speaker 2>share so that my wife can buy another property and

0:26:01.130 --> 0:26:03.050
<v Speaker 2>being the first property that she doesn't have to pay

0:26:03.060 --> 0:26:06.030
<v Speaker 2>for an additional buyer. That that's my intent. So now

0:26:06.040 --> 0:26:08.938
<v Speaker 2>I buy over my wife's share. My wife owns 50%

0:26:08.949 --> 0:26:12.109
<v Speaker 2>of the share. So that's 500 K, right? I have

0:26:12.119 --> 0:26:15.619
<v Speaker 2>to pay for buyers stamp duty on 500 K. Ok.

0:26:15.890 --> 0:26:16.500
<v Speaker 2>So

0:26:17.099 --> 0:26:21.589
<v Speaker 2>what's the other scenario if I own the property in 99%?

0:26:21.599 --> 0:26:26.569
<v Speaker 2>And my wife owns 1% I buy over my wife's share. 1%

0:26:26.579 --> 0:26:32.228
<v Speaker 2>of a million dollars is $10,000. Much more affordable than 500,000.

0:26:32.239 --> 0:26:35.510
<v Speaker 2>When I buy that $10,000 I'll pay buyer stamp duty

0:26:35.520 --> 0:26:40.510
<v Speaker 2>on $10,000 which is $100. That's genius as compared to

0:26:40.520 --> 0:26:40.790
<v Speaker 2>paying

0:26:40.925 --> 0:26:44.275
<v Speaker 2>bias MDT on that 500 K, which is like 9006.

0:26:44.285 --> 0:26:47.573
<v Speaker 2>So I save some money in that buyers M duty. Right.

0:26:47.734 --> 0:26:50.055
<v Speaker 2>So that's the reason why you go about and like

0:26:50.064 --> 0:26:52.935
<v Speaker 2>everyone is telling you, hey, 99 1, 99 1, it's

0:26:52.944 --> 0:26:56.343
<v Speaker 2>efficient in that manner because you save a lot on

0:26:56.354 --> 0:26:57.854
<v Speaker 2>bias M duty. Right?

0:26:58.119 --> 0:27:01.040
<v Speaker 2>But there are some downsides to it. I was thinking about, they,

0:27:01.239 --> 0:27:06.020
<v Speaker 2>they often don't consider now, let's assume this. My wife

0:27:06.030 --> 0:27:09.699
<v Speaker 2>owns 1% of the property and she has used CPF

0:27:09.709 --> 0:27:12.060
<v Speaker 2>on the property as well. Let's assume that she has

0:27:12.069 --> 0:27:17.229
<v Speaker 2>used $250,000 of CPF. When she sells her share to me,

0:27:17.489 --> 0:27:20.800
<v Speaker 2>she has to refund that $250,000 back to CPF. Right.

0:27:20.810 --> 0:27:24.139
<v Speaker 2>How is she going to do that? She has to

0:27:24.150 --> 0:27:27.459
<v Speaker 2>come up with cash from her pocket, put it back

0:27:27.469 --> 0:27:30.239
<v Speaker 2>into CPF. And when the moment comes, when the couple

0:27:30.250 --> 0:27:33.339
<v Speaker 2>realizes that, ok, I'm safe on buyer stamp duty, but

0:27:33.349 --> 0:27:35.920
<v Speaker 2>now I have to forgo $250,000 and put it back

0:27:35.930 --> 0:27:37.050
<v Speaker 2>into the CPF. Where am I going to get the

0:27:37.060 --> 0:27:41.609
<v Speaker 2>money from? Forgot to think about. Exactly. Exactly. So if

0:27:41.619 --> 0:27:43.819
<v Speaker 2>you don't have the means or sometimes people say I

0:27:43.829 --> 0:27:45.420
<v Speaker 2>do have that 250 K,

0:27:45.719 --> 0:27:47.540
<v Speaker 2>but it's supposed to be used for the deposit on

0:27:47.550 --> 0:27:49.699
<v Speaker 2>my new property. And now if I put it back

0:27:49.709 --> 0:27:52.459
<v Speaker 2>in the CPF, where do I get the cash? Two

0:27:52.469 --> 0:27:55.550
<v Speaker 2>steps forward, one step back. Exactly. So it has to

0:27:55.560 --> 0:27:58.959
<v Speaker 2>be considered and it's not always the case that the

0:27:58.969 --> 0:28:02.510
<v Speaker 2>couple would go for a 99% 1% ownership. It might

0:28:02.520 --> 0:28:06.030
<v Speaker 2>be varying like 70 30 there are some reasons behind that.

0:28:06.300 --> 0:28:09.109
<v Speaker 2>But yeah, just to break down simply what this manner

0:28:09.119 --> 0:28:12.510
<v Speaker 2>of holding is about and how it's actually utilized. Hm,

0:28:12.520 --> 0:28:14.959
<v Speaker 2>I think that's exactly it. And then there's so many

0:28:14.969 --> 0:28:17.579
<v Speaker 2>strategies to think about this. When you're doing the 99

0:28:17.589 --> 0:28:21.189
<v Speaker 2>1 70 30 you calculate what you have in hand

0:28:21.579 --> 0:28:23.430
<v Speaker 2>and what you're going to get in the future. But

0:28:23.439 --> 0:28:26.629
<v Speaker 2>the most important thing is how you're going to finance

0:28:26.640 --> 0:28:30.579
<v Speaker 2>it right at the get go without overstretching yourself. Really?

0:28:30.589 --> 0:28:33.390
<v Speaker 2>Because like we've been talking about, you know, it's great

0:28:33.400 --> 0:28:35.379
<v Speaker 2>to think about the future to think about. Ok, this

0:28:35.390 --> 0:28:36.770
<v Speaker 2>is what I'm going to get out of it.

0:28:37.069 --> 0:28:40.459
<v Speaker 2>But what's the, now, what can you afford now? Because

0:28:40.469 --> 0:28:42.729
<v Speaker 2>that's going to be able to stretch you into the

0:28:42.739 --> 0:28:45.420
<v Speaker 2>decades as you get older. It's a very common thing

0:28:45.430 --> 0:28:47.839
<v Speaker 2>that you brought up. Andrea, that people. Really? Yeah, they

0:28:47.849 --> 0:28:50.479
<v Speaker 2>think of the now. Ok. Oh, I have money now.

0:28:50.489 --> 0:28:52.920
<v Speaker 2>Let's do this and let's hold it in 99 1

0:28:52.930 --> 0:28:54.880
<v Speaker 2>in the hopes of getting a second property. But they

0:28:54.890 --> 0:28:57.890
<v Speaker 2>don't think of like down the road eligibility. If I'm

0:28:57.900 --> 0:29:00.310
<v Speaker 2>going to buy over my wife's share, can my wife afford?

0:29:00.319 --> 0:29:01.699
<v Speaker 2>Based on eligibility? The new property?

0:29:02.003 --> 0:29:05.892
<v Speaker 2>Oh, we haven't thought about it yet. Let's not make

0:29:05.902 --> 0:29:10.223
<v Speaker 2>that painful mistake and all the other mistakes that you noted. So,

0:29:10.233 --> 0:29:13.422
<v Speaker 2>buying a property in Singapore, it sounds complicated. Right. But

0:29:13.432 --> 0:29:16.703
<v Speaker 2>if the time is right, if you time it right,

0:29:16.713 --> 0:29:19.463
<v Speaker 2>and you've done your calculations. Well, as Clive has pointed

0:29:19.473 --> 0:29:23.623
<v Speaker 2>out that asset could serve you and your family well,

0:29:23.633 --> 0:29:26.302
<v Speaker 2>in the long run, thanks, once again, Clive for walking

0:29:26.333 --> 0:29:26.402
<v Speaker 2>us

0:29:26.475 --> 0:29:29.296
<v Speaker 2>the consideration and it was great to have you on

0:29:29.306 --> 0:29:31.776
<v Speaker 2>the show. Thanks for having me and thank you to you,

0:29:31.786 --> 0:29:34.816
<v Speaker 2>our listener. If you've enjoyed this episode of Money Talks,

0:29:34.826 --> 0:29:37.456
<v Speaker 2>there is always more content for you to enjoy. Just

0:29:37.465 --> 0:29:40.975
<v Speaker 2>follow us on Apple podcasts or Spotify. Give us five stars.

0:29:40.985 --> 0:29:43.696
<v Speaker 2>Don't forget to leave a review. The team behind Money

0:29:43.706 --> 0:29:47.765
<v Speaker 2>Talks is Jacqueline Chan, Joanne Chan Tiffany, Ang Christina Roberta,

0:29:48.015 --> 0:29:50.776
<v Speaker 2>Wind Jess and I'm Andrea. He.