Having one's own home is always a key accomplishment in one's life. However along with owning one's own home comes with the financial responsibilities of owning and maintaining a home. For us, we realise that we are quite particular about the items and design of our house so we chose to go HDB instead of private. By going down the HDB route, we could use the cash saved to furnish and renovate our apartment the way we wanted. Going down the condo route would have been difficult since cash would be very sparse after coughing out cash for the wedding.Besides, it would seem quite a waste not to use up the government's 30k grant since we pay a sizeable income tax and the government is not in a habit of going huge doses of moolah to it's citizens. While a condo is one of those things in life that provides the aspiration for some people, we felt that since we arent super duper rich, it would be quite hard on us since the exorbitant sums for a condo would result in us being a slave to our house for a term of 25 to 30 years. Both of us would prefer to have spare cash to be in a position to spend it on things we enjoy such as holidays, shopping, food and car. With a HDB flat, we are able to plan to pay up our loan in 8 years time with current monthly payments of about $600 a month deducted from our CPF. This allows us to ensure that when we retire at age 65, we have enough CPF savings. If you are paying for a home for 30 years using your CPF savings,it would mean an empty CPF account which is a frightening thought, unless you are a big income earner. Also, the spare cash saved goes to providing for future needs such as insurance and medical expenses when we get older. We know that many people say that well you can sell your condo for a profit but that is a BIG 'IF' as you are dependent on a good resale market or you can choose the time to see your house ( espeicallly when you are older and you may need to get that cash in hand at the most inopportune time). Also, human nature would be that if you have been living in a condo for 30 years, it would be most difficult to downsize especially from a private to a public property. We also thought that one reason why we arent so fervent over condos is probably because both of us lived in private property during our younger days and it didnt seem like a big deal after the initial excitement of having a swimming pool, exclusivity, the 'glam' factor etc dies off. Besides, the thought of being locked in a 25 to 30 year loan for a condo means virtually you are imprisoned to your job and we did'nt like that thought very much because you never can predict the future. If we do feel like leaving our jobs one day, we can do it without fear since most major things would be paid for already.
The following are some financial commitments imposed which a first time home owner should always take into account so that owning one's own home does not become a stressful event. Do avoid high interest items such as renovation loans or little things that sap your savings such as 12 to 36 month type of installment schemes for your electrical appliances etc.
Monthly
1) Utilities bills ( Electrical , water and refuse removal )
2) Estate / Town Council Maintenance Fee
3) Cable TV subscription
4) Telephone and Internet subscription
5) House Loan Payments ( if you did not have enough CPF to cover monthly payments )
6) Car Park Season Parking Fee ( For HDB / URA carparks )
7) House cleaning ( A little luxury that saves you time and energy )
8) Groceries ( cleaning solutions,toilet rolls etc - always seems a mystery to us how a few items of groceries can add up to a big bill and we are talking about shopping in NTUC buying housebrands where possible)
Annually
1) Mortgage Insurance
2) Fire Insurance
3) Property Tax
For us, we try to do necessary savings because we believe that it is better to spend such money on things we enjoy or save it instead of wasting it needlessly on unnecessary expenditure. One example is utilities. Our monthly utilities hovers between $70 to $80 with use of aircon every late noon and nights.
With shayna's arrival, we also find ourselves using more water to wash and clean her up daily. We try to cut down on utilities by using energy saving bulbs in those areas where the light is turned on for long periods such as the study area, kitchen, dining.
We switch off lights when not in use. We also use the fan when the nights are cooler though this is rare given the heat wave recently. Our fridge, microwave oven, aircons and washing machine have energy saving inverter technology. We also actively turn off all appliances because to leave them in standby mode will add to your electricity bills.
We also look for savings promotion such as the Singtel Mio Plan which for $65 a months pays for Gayle's handphone, our broadband connection and house phone.So when buying a house, don't just factor the loan payments, do consider the maintenance because it's no joy slaving over a house when it should be for your enjoyment.
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