How do people afford condos?
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I was curious about housing prices (and because singles can’t buy hdb until 35), so I took a look at the other options besides staying with parents = condo
Then I see that condo prices are 1M-2M minimum
Wow! So how do people actually afford that?
If someone earns 10K a month = 120K a year, it would still take them at least 10 years (assuming 100% savings, which is impossible) to afford one.
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And does that mean all condo owners in SG are millionaires?
How does this work? Are SGeans just rich?
Netizens’ comments
- They pay for the condos over many years, lol. The last I heard is that the max mortgage period is 30 years.
So on a 10k salary, one would save up for a few years for the downpayment before getting a massive mortgage. - The problem is usually with the down-payment and fees. With a 10K salary I ran the numbers on a bank loan calculator and the maximum loan amount is estimated to be $1M over 30 years.
Up to 75% of a condo price can be paid through mortgage, so the real problem here is finding the other $300K in cash and CPF for the down-payment and fees. Once you have that, you can technically own a condo priced at $1.3M. This is stretching things real thin though with a maxed out TDSR. - Technically, “all” you need to afford a 1m condo is the following.
25% downpayment = $250,000 cash + CPF
75% loan over 30 years (max) = ~$3,000+ per month, which can be partially covered by CPF.
If you can cough out the downpayment, the loan is not difficult to pay at all, just that you’ll be tied down for 30 years. - If you can service the debt you can afford anything
The real question is how do Singaporean afford high end cars. Almost the price of a 3 room HDB and then have to scrap after 10 years.