Rent out HDB and stay in condo

Originally Posted by Unregistered

sorry i just started out and i'm not familiar with HDB matters.

what does HPIS stand for?

HPIS stand for Home Protection Insurance Scheme and is a mortgage-reducing insurance scheme which helps the insured members and their families pay off their outstanding housing loans in the event of the insured members' permanent incapacity or premature death before age 65.

Members who are using CPF to pay their monthly housing loan installments on their HDB/HUDC flat under the Public Housing Scheme (PHS) have to be insured under HPIS, provided they are in good health at the time they apply for cover. Members who are not using CPF to pay their monthly housing loan repayment may choose not to be insured. However it is not recommended as housing loan is usually the largest liability a person has.

You can read more on HPIS on the following CPF weblink:
CPF Board - Ask Us - Explore FAQ

[glenndanker]

Yes, I have friends doing that. There is nothing wrong, our parents and granny time they used to live together, more loving and concern, better relationships. Another thing you can accumulate passive income for better future for all, why not?So I vote that you rent out the condo, do your maths, be wise with money.. play cashflow game

[lerevenant]

Hi Guys,

Read this thread with interest. I am at he same crossroads. I will be qualified to rent out my 5 room flat come Feb 2010 (fulfilled the 5 years MOP) and have been thinking renting it out while i scout for a small boutique condo.

Just like more opinions on whether this is a wise move.

Regards

yes, it is a good choice to rent out your HDB unit/common to earn a decent income stream to supplement your lifestyle and needs.
I am doing that now and living with my parents. the extra cash is very useful.
also if u need an agent for this manner, drop a me msg at [email protected] because i am in this industry servicing clients ranging from students to working professionals.

[springsummer]

Pls take note though...
to buy the 2nd property, you will have to fulfill CPF Multiple Property Rules .
It basically states:
- if you're below 55yo, you'll have to put half of Min Sum (around S$55k currently) in your CPF (combined OA & SA) before you can purchase the 2nd property. Note: Each husband & wife must put half of Min Sum (husband $55k, wife $55k)
- if you're 55yo and above, you'll have to put full Min Sum in your CPF

ONLY the excess of the amount can be used to finance your 2nd property.

Originally Posted by springsummer

Pls take note though...
to buy the 2nd property, you will have to fulfill CPF Multiple Property Rules .
It basically states:
- if you're below 55yo, you'll have to put half of Min Sum (around S$55k currently) in your CPF (combined OA & SA) before you can purchase the 2nd property. Note: Each husband & wife must put half of Min Sum (husband $55k, wife $55k)
- if you're 55yo and above, you'll have to put full Min Sum in your CPF

ONLY the excess of the amount can be used to finance your 2nd property.

If I don't satisfy the CPF requirement, can I still buy a condo, pay down payment with cash and pay installment in cash, stay in the condo and rent out the HDB? From what I heard and read so far, the answer seems to be yes. Can anyone confirm?

Confirmed - you can do all cash. I've a condo and HDB flat, condo is all cash.
Once your CPF hits the 50% Min sum (OA+SA+SRS = ~55k), you can get the bank (or actually lawfirm) to apply for 2nd property financing under CPF, which I did recently, thanks to some market run up and emptying my CPF into the market before buying flat earlier.

Thanks to all contributors. [Very insightful and relevant.]

My contribution: To remind the importance of Financial Ratios.
[Melting pot: Debt, equity, cashflow, Cost of capital, WACC, Gearing/leverage, etc]

Rhetorical question:
"Will you gamble the 'shirt' on your back". [In context: house where you are presently staying. Roof over your head.]