Short Leases = Short-term Joy? So What?
Top image: ExpatLiving

Just under a week ago, Singapore’s National Development Minister cautioned against young homeowners buying re-sale flats with short leases. Specifically, he advised couples to buy a flat that would last them until 95 years of age.

This comes at a time when BTOs are getting smaller, and estates in Punggol can feel like ghost towns. As a result, more and more couples who can afford it are looking to re-sale flats for their space, charm, and surrounding amenities.

While the minister has a point, this fixation on long-term security distracts from the fact that there is immense value in living in the now.

Imagine being in your 30s and eyeing a mature estate that you love for the food, parks, and transport options. Chances are, you’re going to love living and raising a family there. You may have other irrational or superficial reasons, but you’re only human.

For many, thinking this way is still taboo. We think of “living in the moment” and think only of recklessness and irresponsibility.

Yet ask yourself honestly. Between a home in a part of Singapore you love (for the next 40 years) and long term security you won’t even notice on a day-to-day basis, which would you pick?

In the event that you do choose a house solely because of the 99-year lease, would you really be thinking, “Wow. It feels so good to have another 95 years left on my lease!”

Of course you wouldn’t. You’ll be thinking of the laksa and the bak kut teh or the proximity to work and your favourite restaurant. You’ll be thinking that you just love where you live. These day–to–day things impact our lives in a way long leases don’t.

Planning for the future might be important, but the days you spend getting there matter too.

Granted, the idea of a flat with only 40 years left can sound like a bad idea, especially if there’s little chance the estate might be up for the Selective en-bloc Redevelopment Scheme. You could be homeless at 70 with all that CPF money spent on your flat now gone.

At the same time, 40 years isn’t nothing.

It’s 40 years of convenience, of living in an estate with character, of neighbours from across different generations, and perhaps even the space to eventually give your children separate rooms.

That’s 40 years of living and doing things you might not have the time and energy for if you were living somewhere else.

A lot of the criticism against re-sale purchases tends to under-estimate how sensible people can be. Decisions to buy homes with “short” leases are seen as things only rash and stupid people do. Naysayers assume that these are the sort of people who max out their four credit cards every month.

Sure, there’ll always be that millennial couple who bought an old flat in Tiong Bahru for the cafes. But these people aren’t most of us.

And even then, who can truly say that they wouldn’t live in Tiong Bahru if they had a choice?

So if putting $900,000 down on a home you’ll potentially out-live makes sense to you, do it. In the meantime, work harder and start saving for the next home you’ll inevitably have to buy.

After all, we might be talking about living in the now, but this is a ‘now’ that lasts anything from 30 to 50 years. That’s a lot of time to do a lot of the things you love in a place you didn’t just settle for because that’s what everyone does.

Planning for the future might be important, but the days you spend getting there matter too.

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