3 Useful Tips for Singles buying First Condo

If you are single and searching around for your very first private condo, take note of these 3 buying tips.

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     Table of Content

• Tip 1:: Know your objective
• Tip 2: 99yrs may be better than freehold
• Tip 3: Avoid buying with friends

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📌Tip 1: Know Your Objective

• What is your objective for buying a property?
• Are you buying to stay, as an investment or both?
• For singles buying to stay, you should buy the property that you like.
• It should be at least a 2-bedroom unit.
• This extra space will give you more options
• It could be used for your parents or future spouse and children.
• You will need to wait 30 months before you can apply for BTO flats after selling your condo.
• If you are buying as investment, new condos tend to give you more capital appreciation.
• If you are staying with your parents or have somewhere to stay, you will be able to purchase a newly launched condo that is uncompleted
• For investment properties, what your prospective tenants will like is more important than what your preferences are.
• Remember that you are buying the property to lease out and not for your own stay.
• Tenants will prefer new condos over older ones.
• They can accept open concept kitchens and 2Bed-1Bath layouts
• You will likely save at least $100,000 with one-less-toilet (2 bed-1 bath vs 2 beds-2 baths)

📌Tip 2: 99yrs May Be Better than Freehold

• Many first-time buyers think they need to buy a freehold property.
• However, I feel that It is ok to settle for a 99-years condo when buying your first property.
• Your lifestyle may also change as you grow older or when you start a family.
• It is most probable that you will buy a second condo after you make a profit from your first real estate investment.
• Freehold properties near MRT are rare and cost 15-20% more than a 99 years condo.
• You can sell your 99-years condo before it reaches the 10 years mark.
• Lease decay is not a big concern when the condo is below 10 years old.

📌Tip 3: Avoid Buying with Friends

• The thought of roping another single friend to co-invest in a private property is tempting and is an avenue some people might explore.
• The combined funds will allow you to buy a bigger property with less pressure servicing the mortgage.  
• However, there are many instances of disputes that comes with this kind of arrangement as people tend to evolve in their thoughts with time.
• A condo unit is not divisible when conflict arises.
• You can only cash out by selling the property.
• When to sell, how much to sell or rent are all sensitive questions.
• If you must co-invest with a friend, you must have an exit plan that is feasible and allow all parties to cash out amicably.
• This plan should contain answers to the above questions.

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