Case Study: Guiding First-Time Buyers Max & Jaelle

Jason & Elle | Multi Award Winning Property Agent In SingaporeJason & Elle | Multi Award Winning Property Agent In Singapore

Max and Jaelle, like many first-time buyers, were thrilled at the prospect of owning their first home but apprehensive about the costs involved. Initially interested in a BTO flat, they decided to purchase a resale flat due to the long waiting time for BTO construction.

Challenges:

• Unfamiliarity with Costs and Process: Max and Jaelle were unaware of the various costs involved in owning a flat and were unsure about the procedures for buying an HDB.

• Cash Over Valuation (COV) Concerns: They were worried about having to pay COV, which would strain their finances, especially with additional costs for renovations and upcoming wedding plans.

• Decision Uncertainty: They were uncertain whether buying a resale flat was a good decision, fearing potential difficulties in selling the flat in the future due to lease decay issues.

Our Approach and Solution:

We met with Max and Jaelle to develop a detailed financial plan, ensuring they were financially prepared for the purchase. Understanding the importance of prudence, we advised them to assess affordability based on both lump sum payments and monthly installments to determine a comfortable price range.

We also shared with them the full ownership costs, including stamp duty, legal fees, Home Protection Scheme payments, HDB administrative fees, valuation fees, and agency fees. We shared insights on the differences between newer and older resale properties, highlighting the impact of the 95-year rule on the future demand for older flats.

To address their COV concerns, we analysed the pricing trends in various neighbourhoods to identify fair prices and avoid the “dangerous range” that could lead to a COV situation.

Results: We successfully found a 4-room flat for Max and Jaelle in a convenient location, corner unit and on a high floor. We negotiated effectively with the sellers, securing a price that was within their budget.

They were thrilled to receive the valuation results—NO COV! The flat was also still relatively young, which was important given their status as first-time buyers.

We are incredibly thankful for the trust and support of Max and Jaelle and wish them all the best as proud owners of their matrimonial home!