Our Starter Home: Taking the Resale Route
While today K, Sophie Rose and I have moved into our new, dream, second home, the truth is you never quite forget the first home you make together – your “Starter Home”. And we bought our Starter Home in 2011 – this is our story (photos may be a bit outdated, its been half a decade, after all!).
*This post is written in conjunction with Smart Parents.*
When K and I decided to get married five years ago, we knew from the onset that we would want to move out of our parents’ place and stay on our own. We firmly believed that in order to build our own family unit and set the right tone to married life, we needed to stay together – alone, to make our memories, have our fights with the privacy we need, and learn how to live with another person (by choice, lol).
In many countries where property prices are sky high and inaccessible, this would be something that was impossible for two fresh graduates with very humble savings. Which is why I truly feel that in Singapore we’re blessed to have such a great public housing scheme and system which allows for young couples to have their own home very early on – or even before their marriage so that they have a space to call their own.
Back in 2011 when K and I were searching for our Starter Home, we had two options:
- Apply for a Build-to-Order (BTO flat)
- Buy a Resale flat
And our preferences were:
- Being close to our parents. Family support is so important especially since we intended to start a family not too long after tying the knot
- Being close to public transport, as we hadn’t bought a car yet at that point
- Being near a town centre, so we would have easy access to food, amenities, etc.
Since our parents both stayed in landed properties in mature estates, and there were no BTOs nearby available, we decided to take the resale route. To mollify K, who felt that we would not be getting a good deal by buying resale straight off the bat, we did attempt to apply for two developments in Punggol and Sengkang but there was a HUGE backlog in the BTO units available at that point (a problem that has since been rectified, lucky new house owners!) so after getting two “your number exceeded 300% of a the supply” responses, we gave up and decided to go resale flat hunting.
Of course, deciding to purchase resale would mean forking out a substantial amount of Cash Over Valuation (COV – a concept which has since been scrapped) and we had our own share of friends trying to persuade us from taking the resale route.
“You’re not maximizing your grant”, “What’s wrong with Punggol and Sengkang, not bad what, you are paying so little, I’m sure you can make some money when you sell in five years” – were common refrains.
But we stood our ground because to us, our first home had to be a home that we fell in love with, rather than a money-making scheme. We also had suggestions from friends who, after knowing that we wanted to buy resale, said we should buy a tiny flat in a really good area – near the CBD, for example, so that we could, again “flip” the property.
At this point, with so much advice, both solicited and unsolicited, K and I decided to re-examine our priorities. It’s easy to get carried away by all these ideas of “flipping” or “easy money” as young, naïve and quite gullible first-time buyers, so I would suggest taking a step back and asking yourself and your partner what you really want from your Starter Home before you decided what you’re looking for
And here were our takeaways after having a long heart to heart:
- Our Starter Home should be a home we can see ourselves living in for a long time (even if we do decide to move) and one that we can picture as a HOME, not just a flat, or a house. Stuffing all our belongings and ourselves into a tiny flat for its resale value was just not something we could picture ourselves doing – at the cost of our quality of life.
- Stick by your guns – don’t let other people tell you where you should stay. Go with yours and your partner’s gut instinct. After all, you two will be the ones staying there, not your friends and their advice.
- Do your research – buying a Resale Flat does not mean you will be entitled to significantly less grants than your BTO-buying counterparts. In fact, I would say that all in all, we got amazing value for our first home along with government support.
And so, we sallied forth, armed with a map, a new account on Property Guru and the contacts of a few agents who specialized in flats in the East, and a lot of hope and excitement.
First, we tried Marine Parade. We set our budget for our Starter Home at around $550,000, with about $50,000 of that going to Cash Over Valuation (no longer applicable today).
Back then when property prices were an all time high, it was almost impossible to find a home of a good size within our budget, in Marine Parade. On average, a 4-5 room flat (low level) was around $600,000 including a COV which could be almost $100,000. Clearly, we were not prepared to fork out that much cash and start our married life either broke or in debt, so it was out of the question.
We ended up looking at several beautiful 3 room flats with sea views in the Marine Parade area. But the size of the flats put a dampener on our spirits – how would we fit a family into these very stylish flats with almost no storage space?
If you’re getting confused at this point, rest assured, so were we. So here are some tips that can help you assess the value of the house (to you).
- If the flat comes “fully furnished” – ask yourself – is the design to your liking? There’s no point moving into a well-appointed and well-furnished apartment when it doesn’t suit your taste. You should be able to customize your first home to your liking, not settle because you think you’re getting good value. Remember to ask when the home was last renovated, too – things like floor laminate don’t usually last well past 6-7 years with wear and tear, and that’s additional $$ you’ll have to pay when the time comes sooner than later to get it changed. Ask about plumbing, things like how many times the house has changed hands, or if the flooring is overlay and conceals a previous layer of tiles (this is a problem if you want to renovate).
- Don’t forgo the space – especially if you intend to have children soon after marriage. For us, a 4-room flat was the smallest we could imagine ourselves going, with a master bedroom, a walk-in wardrobe (the second room) and finally a study/nursery.
Having an extra room (4 rather 3) meant that when Sophie Rose came along we had space to create a playroom/nursery for her
- How many minutes to the nearest MRT or well-connected bus stop? Consider your work commute – it may look easy on paper taking a bus, then a train, then a walk – but doing this everyday can be exhausting.
- Which parts of the home get morning or afternoon light? You don’t want to get stuck with a home where your clothes never dry.
- Picture yourself living in the home – do you like the configuration of the rooms and kitchen? Ask yourself what you would change about the home if you should buy it and move in.
- Who are your neighbours? Have a look around you and get to know who they are before buying the home.
- Do you see yourself staying here for the very long term (>10 years) or moving somewhere else?
With this in mind, we decided to search another part of the East again. And we were lucky – after seeing less than 10 homes, we’d found the one we were looking for. A five year old 4-room flat which came with stylish built in storage, furniture in the style we liked, and right smack in between the Tanah Merah within our budget and with a COV of $50,000 – exactly what we planned. We were close to losing hope at that point as our wedding was just around the corner and we still hadn’t found a place to stay.
Then came the grant applications. As I had just started work then, our combined income was well within the limits of the CPF Housing Grant. We benefited from that, as well as the Proximity Housing Grant ($20,000). All in, I would say we were granted almost $50,000 in subsidies and support from the government, which was extremely helpful and encouraging. Now, the amounts have been increased even more, making it even more accessible for young couples to buy their first home, and we think that’s absolutely great!
We spent five wonderful years in that 4-room flat, which we improved, changed, re-configured and made our own over the years. We became firm friends with our neighbours, and really loved the quiet, serene and yet accessible atmosphere of the development (it was a very small development of only 5 blocks). It was also the home in which we brought our furkid, Benjy, home, and eventually welcomed our first child, Sophie Rose, three years in, and where she spent her first two years of life.
The memories and the attachment to that flat are indescribable – and a large part of how great those years were came from making informed and educated choices about buying our Starter Home. I hope our little guide has helped you in your journey towards buying your first house and making it a home!
Libby, Alex and Sophie Rose