By Chong Qi Hui, Head Of Research
Date: 16 Sep 2020
Photo by Hong Leong Holdings
There are several close clients and friends asking for our thoughts and opinions on the latest new launch in Singapore – Penrose by CDL and Hong Leong Holdings.
Just some thoughts after our research, Penrose is definitely one of the few new launches in Singapore that is worth taking a second look this year.
While there are several attractive selling points in the project, the main value will be the low land price which allowed the developers to price this project reasonably competitive in today’s market.
However, let us put things into perspective.
Assuming that you are a young working adult or a young family with growing kids looking to invest in a one-bedder unit based on a purchase price of $800,000 and that this is your first residential property in Singapore with a maximum loan margin of 75%, here is the breakdown of the cash outlay:
– Cash/CPF (25%): $200,000
– Stamp Duty: $18,600
– Legal & Miscellaneous: $3,000
Supposedly you are getting a 30-year P+I loan at 1.8% interest rate, your monthly instalment will be at $2,100+.
The questions you must ask yourself are:
1. Do I have $220,000+ in cash/CPF? If yes, is this my entire treasure chest?
2. With my current take-home income, what is the proportion of cash that I would need to repay the bank at monthly instalment of $2,100+?
In conclusion, do not buy or invest in properties due to FOMO syndrome. Work out your finances and make sure you are not overstretched in future.
Be heedful my friends!