Home - Buying a house in your New Country
As the views came from US, Canada, OZ etc thought I will put up something generic
1) Always rent first. Get a feel of the area, housing and planning laws and what type of houses hold the value well etc. It will take 6 to 1 year before one gets a reasonable idea of the surrounding. Depends
2) Pick the school first, then the suburb to rent in.
3) Diligently attend open house inspections which are common in advanced countries which is something not done in Singapore. Gives you ideas, tells you what to look out for etc. Learn about things that are important and costly such as salt damp, termites in foundation, insulation, orientation of the sun (considered important for value) etc
Yes, very important
4) Never accept the recommendations of relatives and friends who are residing there. They will invariably recommend their suburb. Its human nature. Do your homework. Talk to non-asians and professionals (whites).
5) The rule of thumb is to "buy the worst house in the best street". Its the location that over time will carry up to 80% to 95% of the value.
6) Never overcapitalise - never build or buy a luxury home in run down neighbourhood. Such houses are usually owned by ethnic minorities who have extended families or "rich man" who prefers to live near their ethnic community.Agreed
7) Never buy near marginal areas or suburbs close to known ethnic minority areas.depends - here if it is chinese and upper income not problem but chinese and lower income DONT
8) Avoid suburbs that are known for periodic events such as floods (including 100 year floods), high winds, former dump, etc.
9) Check the website for allowable plot ratios which gives a fair indication where the suburb is heading as well as planning guidles for the future. Very Important - look at the master development plan
10) Don't get stricken by analysis paralysis - unable to make a decision. The good part is that good schools attract good homeowners and the value rises. Agreed - but also have to look at your needs, if a couple with out kids, it is a whole different ball game
Good Luck.
Hi brother,
i just have a few points i would like to make - Life is dynamic. if i did the above, i believe my fortune would have been very different compared to now.
I see the migration landing to be "Just like fighting a war, you will want to land in the softest beachhead and make your way inland"
i learn from a alberta based website, i sure some of you could use the same some of the advice that i based my decision.
a. Mortgage Interest Rates
This will determine if you are going to get a fixed or variable mortgage. If the trend is going to go up = fixed the rate, if the trend is going down = variable. Now when i arrived, my rates was 8% after i sold my 1st house, i set my interest to variable now my current interest that i am paying is 1.75%
b. Net Wealth Effect
Is the city that i am living is going to become richer after the cost of living,etc.
c. Job Growth and Demand
Wifey found a job, within 4 days of landing in fact her last day of work in sg was 1 week before flying and started work in new country 10 days after landing (seem crazy now)
d. Real Estate Dopple Effect
I brought my property in a sub division that is next to the main ring. on the outter side of the ring road rather than the inner side fo the ring road
e. Local, Regional and Provincial Political Climate
I choose alberta as it is the only province with "ZERO" debts, the oilsand up north , i know that is another 20-30 years of work in process. Edmonton was really welcoming newcomers - it is the 1st city that i come across that the people actually give way to each other as part of the social grace
f. Critical Transportation Expansion
My current house will have a main road linking to the major ring road in 2 months time (value is going to increase). They just built a Transit centre and a 77 million Recreation Centre
g. Cost of labour and Materials
It is a recession going on, the prices have gone down lots since i arrived. You can evaluate if you want to buy a "resale" house vs a brand new house. Some time speculators are even willing to sell it off below the replacement value. My rental property has positive cashflow so the prices go up or down. Has not much effect on me. If you think out of the box, you can also built a basement suit with it's own entrance, so the tenant can help you to pay down the mortgage. In short, be creative and ask around for options available to you and do the maths then make the decision
h. Areas of Gentrification and Renewals
I. Zoning Opportunities
j. Wholesale Buying
k. Quality Marketing
L. Renovations and Sweat Equity.
I am always adding equity to my house. May it be via the development from the city or doing renovations to increase the value. For the basement, i added a Movie threater with a bar counter, Game room, sauna and a guest bedroom. For the backyard, i added a pation with a outdoor kitchen with water feature and you can play music thru out door speaker for your parties or entertainment. A lot of people might not see the logic but i am building equity. I know that all that the next buyer of my house will pay top price for the new additions
m. Risks of speculation.
When my 1st property sort up by C$150,000 within 6 months. I know that what goes up must come down, Lots of people thinks that i am stupid to be selling telling me to hold on for better $$. I sold it and brought a basic house and started building my equity. When the prices was near the peak, i refinance it and pull out the equity. Then i have a warchest of $220K - i reinvested it on rental houses for cashflow. i know that - when my passive income is greater than my expense, i can actually not work and i did just that
When i landed, the Real Estate market was going up like crazy, as the supply was very very short. It started galloping in 2005.
I roughly know when i will be received my PR - i was checking out where i wanted to land. Vancouver or Toronto, in the end, i stumbled across a little know real estate rule in Alberta, u can assume a property ie - agreed sale price is 300K - mortgage 270K. Presto the property is yours when you pay the different, you just have to carry on paying the mortgage every month.
I started to focus on which either Calgary or Edmonton. I realize this trend, Calgary is a bigger city (white collar) than Edmonton (blue collar). The price movement will cascade to edmonton in more or less 3 to 6 months time frame.
I wrote a list of objective i wanna achieve in my 1st landing
a. assume a property,
b. Go for as many job interview as possible for wifey. We started our job search before we landed, we told them we will be landing on certain date and should be available for interview for the next 2 weeks. Get a job.
b. the property should be in the southwest of the city - the lowest crime rate (check out the crime stats),
c. what are the schools in the area and do the registering.
d. What are the bus route.
We managed to achieve all the item as i was planning prior to landing and i only know 1 person in edmonton before i landed.
We went back to Sg -we resigned from our jobs, sold our HDB, 2 business and ship our furniture that we could reused and by some suitable and necessary furniture. Brought all the little stuff, like the toilet toiletries so that we can kick start, before we actually started to replace it eventually with local produce. 3.5 months later, we landed again this time with our container.