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Old 09-04-2024, 03:53 PM
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Condo vs HDB: Why undergraduate, 25, bought private condo

SINGAPORE When it comes to purchasing first homes in Singapore, it is common to buy a Housing and Development Board (HDB) flat, either through balloting for a Build-to-Order (BTO) unit or buying one from the resale market.

Eschewing the usual first-property route, university undergraduate Daniel Heng, 25, recently put down a hefty deposit for a S$1.27 million condominium unit. The low-rise condo, in which Heng told Yahoo Finance Singapore he intends to live, is located in the central region and is slated for completion in 2027. Heng, who is also a certified financial advisor and personal wealth manager, bought the home with some help from his mother she loaned him S$100,000 for the downpayment of S$354,000; Heng said he intends to repay her with interest.

As a working university student majoring in accounting and business, he earns over S$20,000 per month providing financial services and advice to high-net-worth clients. He started as a "broke university student" at 22, spurred by events in his personal life. With a modest family background his mother is a single mum who worked as an accountant to support him and his two sisters Heng was motivated to work and pay for his own university fees.

"I only spend what I need to, and invest the rest of my money as discipline savings," Heng shared. His investment portfolio includes, among others, equities, fixed-income investments and cryptocurrency.

Condo vs HDB
Heng, who is single but in a relationship, considered purchasing an HDB flat as his first home. Though there is a fiance-fiancee eligibility route for BTO and Executive Condominium (EC) units, Heng's monthly earnings had exceeded the S$14,000 and S$16,000 income ceiling for BTO flats and EC apartments respectively.

Furthermore, Heng said that he wanted to live in the central region as he travels around Singapore throughout the day to meet with clients.

"Central is really the most efficient place, and I don't mind paying a space premium for being efficient. I don't mind getting a smaller unit within my budget if I'm more connected," said Heng, referring to his newly purchased 463 sq ft condo unit at Orchard Sophia.

Heng also explained that buying an HDB flat in the central region, or in a Prime Location Public Housing (PLH) project, would mean that the Minimum Occupation Period (MOP) would be 10 years this is five years more than a regular HDB flat. This was an opportunity cost, Heng said, as he could "upgrade" only in 10 years.

Resale flats were out for Heng too. Besides being ineligible as a single buyer who is younger than 35, Heng said that buying a condo unit is a form of "investment into my business". He shared that he hopes to inspire his team members and give them something to aspire to.

"I thought that being able to buy a condo will serve as an aspirational visualisation for my associates. It illustrates the potential rewards of hard work and ambition. Letting them see the place, and see that I can afford it, will motivate them to work hard so that they can afford it for themselves," said Heng. He had emphasised to his property agent the need for a home that would fit a "swanky" image.
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