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Sunday, March 26, 2023


We just decided to tie the knot! While this is typically a happy occasion for most, we are now hit with our biggest obstacle as a couple so far – housing affordability.


We are lucky/unlucky to be ineligible to BTO. We are in our mid-30s, have been slogging at our jobs for some time and for now, we have exceeded the $14,000 income ceiling (emphasis: for now!)

Typically, this would not be a big deal and we would just pay a tolerable premium to get a resale flat. Unfortunately, the huge run up in the last 2-3 years have driven this premium up to levels that no longer make sense. We are talking about $150K-$200K increases on average here.

As a side-rant to this, the current BTO system and the lottery effect creates a group of “haves” and “have-nots” (something that PM Lee cautioned against) with no meritocratic basis AT ALL.

We are extremely fearful of what is to come w.r.t. the economy.


– We both work in tech and are worried about our future incomes if the current climate persists.

– We are now in our mid-30s and do not have the luxury of a long time horizon.

– We started financial planning late in life and have not moved much due to our inexperience. We are aggressive savers who only started investing recently, and faced more losses than gains. Fortunately, we were conservative and the losses are not crippling.

– The economy looks to be forced into either a deep recession or hyper-inflation – neither of which are good outcomes. This is relevant to the options we intend to explore.

– Interest rates could go anywhere from here — including much higher and much longer than predicted.


– Singapore has to continue to do well in order for us to maintain value in our property. There is no denying that we will be encountering further headwinds.

– We used to view housing as a necessary expense that we want to spend a prudent amount on. That means buying an affordable home that meets our needs, saving and investing the rest for our families and future.

These are the options we have before us, and none of them look good. Hoping to get your perspectives and advice.

1. Buy a resale flat now and pay the asking price. We aren’t very savvy investors, but were aggressive savers. This means interest rates are less of a concern, but we will have less investable cash and assets as a result. Two ways to go about it –

1a. Buy a flat within our means and meets our needs, even if it means spending more in today’s market – convenient location, close enough to MRT so we save on buying a car, long enough lease that we don’t kick the can down to lease decay.

1b. Buy a flat below our means and suffer temporarily. Ulu place, new-ish flat so that lease decay is manageable. Wifey may not be too happy about this long-term, so we need to exit from this position well in 5 years, hopefully. Because common wisdom dictates “happy wife, happy life.”

2. Wait, see and hope that prices become more rational. Live with parents first, buy later when flats hopefully become cheaper. The Government should be doing something about this, right? 15-month wait out period for downgraders is for them to create a corrective policy (one can only hope)? Right?

There is an element of risk here in timing the market. Prices may never revert to normal levels in the near term and we incur the costs of (1b), enjoying the home later and still end up paying more.

3. Buy a new launch EC. Sounded like a good plan until we realized that the PSF has also shot up crazily in recent years. The current ones run around $1,300-1,400 PSF. Interest rates are crazy now, but like we said, we are prudent savers and have the option of borrowing some from family to pay more upfront in cash so that we are less leveraged.

Side note: It is said that ECs are heavily subsidized by the Gov, but looking at these prices, we find that hard to believe.


This is a very aggressive option that makes us uncomfortable, given that we are conservative and are not speculators. However, it could make sense for the following reasons:

– The other housing options are clearly overpriced/risk being still overpriced after waiting.

– If there is a high chance of deploying our savings into this to keep pace with inflation. While we feel this is overpriced too, unlike the other options, it has a better chance of keeping pace with inflation, which is one of our bigger worries.

Our arguments against this:

– Property is generally a good hedge against inflation. But there are many other factors that determine a property’s current and future price. We don’t want to overpay for a hedge, but how do we know?

– This is one singular, concentrated bet that could do well/poorly/nothing at all. If it does nothing at all, that’s still a loss given the huge opportunity cost.

tl;dr: Need home, not now but soon. Gov said we cannot BTO due to income ceiling, but we are worried about future income. Saved hard to expand our range of options, but all of them don’t look like very good financial decisions in current climate, yet current climate could persist or even worsen. How ah?

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