10/01/2010
New EC and how much to pay
The new EC at Buangkok is asking for $730-$750 psf and the buyers are those within the $8k-$10k income group. The average price of a 3 bedroom unit is around $850k. Presumably those earning more than $10k pm are too rich to buy these cheap flats.
What would this amount mean to a young couple who probably have worked for less than 5 years? Assuming they could cough out $100k for the initial sum, it would mean taking a loan of $750k for 30 years. Roughly it would mean paying a total of $1.5m by the end of the mortgage. Divide this by 30 it will mean a yearly payment of $50k or $4k monthly. This sounds very reasonable and very affordable. The couple would still have a balance income of $6-7k pm.
This is the new minimum price for EC. Can’t get it cheaper any more. And anyone buying a unit will instantly join the millionaire class.
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6 comments:
It sounds very reasonable and affordable when BOTH are employed. If one of them hits the rocks, there goes the home.
More pressure to do well at work, more pressure to stay employed and employable.
Pressure brings domestic conflicts, child/parent problems.
Pressure and stress depresses the immune system. The big "C" word is a reality.
How the devil did we end up like this?
Welcome to the Singapore of imported price bubbles.
Look at the bright side. By the time they hit retirement age, the property could be worth $20m. Then they can either cash out and migrate or sublet to earn an income for their twilight years.
It is a good thing. All planned for a good future ahead.
If they can survive to retirement age.
Being positive is one thing. Facing up to reality is another.
I worry for my children's children. But being my children, they are already planning twenty years down the road.
That $20 million is as good as the Japanese local mint during world war 2.
I guess if the couple don't have to eat,don't hv to support aging parents,don't hv to raise children,no insurance,don't hv a car,never be stricken by a dreaded disease,don't loose their job to foreigner,no need to pay income tax,no need to pay maintenance fee....their"dream" home seems affordable.
Me view this as totally irresponsible and reckless to take such a big loan depending on a salary that can stop anytime. And when it does, bankruptcy and despair is order of the day.
This is like betting on the future with big stake.
"taking a loan of $750k for 30 years. Roughly it would mean paying a total of $1.5m by the end of the mortgage. Divide this by 30 it will mean a yearly payment of $50k or $4k monthly. This sounds very reasonable and very affordable. The couple would still have a balance income of $6-7k pm. "
...affordable until they get retrenched in an economic downturn and lose their cushy jobs. These days salary level is a wild swinging variable. You could be making $8k a month for a few years, then $3k for the next 10 years.
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