EC Hitting MOP (Minimum Occupation Period), What’s Next?
A brief intro on EC
ECs were first introduced in 1996 as a public-private housing hybrid catering to the sandwiched income group, which are households with incomes ranging from S$12,000 to S$14,000. Like regular condominiums, ECs are designed and built by private developers so you get to enjoy similar lifestyle with the facilities while paying much less premium, in general around 15 to 25% cheaper than private condominiums.
If you have made a wise decision to purchase your EC which is going to hit 5 year MOP, then congratulations that you most probably are sitting on 200k-300k paper gain right now.
Ways to un-lock your gold mine
Let me share with your various ways.
- If you wish to upgrade to a better location or a bigger units - Sell and Buy another condo
- If you are near retirement and hope to supplement your retirement account with large sum of cash – Sell and downgrade to HDB
- If you hope to maximize your investment returns for the next 5 to 10 years – Sell and buy another 2 condo under 2 names ( husband & wife separate ownership for tax saving purposes, income need to support the loan)
- If you really like the house and wish to invest another property – arrange transfer of ownership to one party and free up another party for the new purchase. (tax saving purposes)
There are 4 more complex financial techniques you can explore to get extra financing and save on tax, which requires detailed financial planning and need analysis.
Wait...What if I keep my EC after MOP?
You might be considering why not I just keep the EC and do nothing? Yes, many owners may choose to do so as they are very comfortable with their house and have made many friends in the estate. It’s absolutely alright to do that if you just treat your house as a home to stay and do not expect to maximize the profit. If not, you may want to read further and open your arm to embrace the next big wave coming your way.
Savannah owner A chose to hold the property for 17 years from year 2002, he had grown his $120K initial investment into $730K by now. (608% return, not bad!) While, Savannah owner B decided to re-structure his portfolio in year 2008, he had accumulated $1.5M net worth within the same period of time, a whopping $770K more than owner A!
Many buyers are hunting for newer condos to move in, and your unit is in its optimum condition which will attract these buyers to pay you the best price upon MOP.
Your right move to ride the wave of EC growth created this opportunity and now is your chance to grow your assets even further and advance your financial freedom 10 year earlier.
Today’s property market is becoming tougher after 9 rounds of cooling measures. Investors need to be more careful and patient to make profit compared with the past. Hence, it’s prudent to plan ahead to avoid making any financial mistakes, and talking about property, it’s going to be huge.
In a detailed property planning session, you will know:
- 16 Deciding Factors to choose the right property
- 8 Financial Techniques to get extra funding
- 4 Investing Strategies to save Tax
- 6 Signs for the right time to exit from a property
Personalised property planning to cover your financial analysis, property portfolio diagnosis, and Mid to long term asset progression plan.