Tenancy Lease Ending And Other Property Related Ruminations

My current condo tenancy lease is coming to an end in April, so I asked my agent to inquire about a re-contract. Just last week, my tenant agreed to continue the lease for another year, but has negotiated down the rental by over a thousand bucks. With the reduction in rent, and increased property taxes, and slowly increasing interest rates, I will just about break even this year after doing a little maintenance work.

I have agreed and we will be signing the new lease end of April. I can’t complain about the rent reduction though. I have had it good for the last two years, charging 25% over market rate. However, the rental market is now a lot quieter and plenty of other units in the development are on offer. According to my agent, there are about 40 other listings still pending for this development, and some have been on the market to rent for almost two months without any nibbles. My tenant has been really quite easy to deal with, so I just want to keep him. In fact, I intend to bend over backwards to accommodate his every request. J

I have also been thinking about what to do about the property investment once this newest lease is up. I will probably want to go for another one year lease if possible and then look to sell in 2016. Previously I have discussed about acquiring a HDB flat, but now I am hesitant again, due to

1) the new cap on rental to foreigners, and

2) the creation of the BTO scheme for singles reducing demand for local HDB rental, and lastly,

3) the restrictions on minimum occupancy period, and waiting time of 2-1/2 years between disposing of a private property and buying a HDB.

Also, the idea of two properties is fast fading away in my mind because of all extra costs involved – additional 7% buyer stamp duty, higher downpayment, the low LTV (loan-to-valuation limit) for financing a mortgage (though the last two are not really problems if I am able swing a cash purchase).

I could keep the current condo, but it’s not ideal as a rental property because it’s really too big, not that well located, quite old and not that well built (starting to need $$ for continual maintenance).

I was cracking my head, then Mr. C suggested – sell the current place, and get a dual key apartment. Prior to my current condo, I was looking at one such place in the east of Singapore. The layout was split into a studio (complete with kitchen area and bathroom) of about 400 sq ft, and a two bedroom of about 900 sq ft, with separate entries, but sharing a common foyer area. The studio will be mine to live in, while the 2 bedder can be rented. It would effectively be one property purchase but would act like two separate properties. I would have to install extra meters to keep track of the utilities usage, but it could work. And the idea of not having to travel across the island to carry out any landlord duties has its attractions.

At the time I was looking, the dual key place and my current condo (both freehold) had similar prices. So it probably would not lower my mortgage any, but it would be a much better layout in terms of flexibility.

I am still talking to Mr. C about alternatives, and would probably start shopping around later part of the year to see what’s available and have an idea of the price levels. I do feel like I keep going around in circles on the whole property and rental income issues, so I apologise if readers feel dizzy from all the ruminating I keep doing.


2 comments on “Tenancy Lease Ending And Other Property Related Ruminations

  1. As long as you are happy. Remember that sometimes this retirement vehicle can be a job you would take up a fair bit of effort. Understand end of the day if this fits the value system of your financial independence.

  2. anon says:


    Havent seen you posting in quite sometime. Hope you are doing ok.

    All the best!

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