Home buying tips for your 20s, 30s and 40s

By Aaron De Silva / EdgeProp | May 19, 2017 10:53 AM SGT
Your home ownership goals change as your life progresses. Those in their twenties are probably just getting their foot on the property ladder; thirty-somethings might be planning for their growing families; while forty-somethings could be on the market for investment properties. For advice on what to be mindful of at each stage, we turned to an independent mortgage consultant Sean Lim. Lim is the founder and director of FindAHomeLoan. He works with banks in Singapore, Malaysia, Australia, the UK, and others to help buyers find the right mortgage solution.
Mortgage Consultant Sean Lim
In Your 20s
As a twenty-something, you’re likely to be a first-time buyer. Assuming you didn’t inherit a fortune, and only entered the workforce recently, your finances are going to be lean. Not only do you have to set aside the downpayment, but there are also renovation and furnishing costs to consider. It’s best, then, not to overstretch your budget. “Be pragmatic,” advises Lim. “(Ask yourself if) you really need a 5-room HDB or condo as your first property. (And then) borrow based on what you can afford.”
To find out how you can lower the cost of furnishing your starter home, check this out.
Once you’ve worked out how much you can afford, evaluate the different loan options available. “For those buying a HDB flat, consider the pros and cons of borrowing from HDB and banks,” offers Lim. Then consider whether a fixed- or variable-rate mortgage is best. Fixed rates provide stability, but if you plan to keep the property for less than 10 years, a variable rate might work in your favor.
Which leads us to the next point: how long do you intend to keep the property? Given the transaction costs, agent fees and fluctuating market conditions, there’s no guarantee you’ll make a profit if you flip the property after a few years. Conventional wisdom has it that buyers should hold on to their properties for a minimum of five years. (In any case, HDB’s Minimum Occupation Period only allows sellers to put their flats on the market after five years). This allows you...