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Sell 1 Buy 2 : Will it work for you?

Updated: Jan 27



Sell 1 Buy 2



You probably would have come across this ad on Facebook or watch a video proclaiming that it is possible to sell 1 HDB and purchase 2 Condos. Some even went to the extent of promising you cash of up to $200,000 ++ if you adopt this strategy.


While it may sound like an impossible dream, to the right client, it could unlock the gate to private property ownership and allow you own multiple properties without footing extra cash.


We break down the mystery of this strategy and show you how you can make it work for you IF you meet certain conditions.


What is Sell 1, Buy 2?




This strategy is mainly targeted at HDB upgraders. The basic idea is for a couple to sell the HDB they live in and buy 2 private properties, each under their own names. In some cases, you can achieve this without the need for additional cases. There is even the possibility that you can get spare cash during this trade.


Sounds too good to be true?


Here is an example

A couple in their 40s who had been staying at their HDB Executive Apartment (EA) for almost 20 years. The EA was purchased at $350,000 and was fully paid. Today, they can sell the unit for $875,000, which is their nett proceeds.


They decided to use the funds to buy 2 properties. One of them purchases a $1.6m 3-BR condo and the spouse bought a smaller 1-BR Condo at 700K.


The total value of the new properties is $2.3m. Assuming the loans for both houses are taken at the maximum value, the downpayment required for both properties is at $575,000 (25% of property value)


Property Proceeds from the sale of HDB: $875,000

Cash / CPF downpayment needed for 2 new properties: $575,000

Cash Returns: $300,000


From the example, a couple can now own 2 private properties with spare cash of $300,000. Their property aspirations have come true!


Benefits of Sell 1, Buy 2


This is what the couple stands to gain if they adopt this strategy






Who Qualifies?

While this stradety is possible, it does not apply to all HDB upgraders. The effectiveness of this would be dependent on various factors.


Complete this checklist to see if you qualify




Dual Income Households

The strategy requires both husband and wife to take separate loans with different banks. As such, both must be working at the time of purchases of the new properties. Additionally, as buying a house is a long term investment, it is best to ensure that dual income arrangement is maintained for the long term.


Sufficient funds for downpayment, stamp duties and lawyers' fees


The following funds are required

  • 5% cash

  • 20% downpayment (CPF/Cash)

  • Approximately 3% for Stamp duties and Lawyer's fees

Ensure that these are sufficient before committing to the purchase.


Each individual to be able to take housing loan under their own name

Both parties will be required to check if their income is sufficient to cover their respective loans. Other than income, the individuals' credit rating is important too, as it will determine if they can take up the additional loans. The last thing to consider is existing debts, as this will also affect the amount that one can borrow from the bank.


Sufficient Reserve Funds

As this strategy is based on dual income, it will be prudent for the buyer to have sufficient funds to manage the cash flow in case of an unexpected situation. A good reserve funds should be able to cover at least 6 months of loan payments.


A way to mitigate this would be to rent out the second property. If this is done, cash flow would significantly improve. In some cases, rental may even provide a positive cash flow if it is higher than the monthly loan payment to the bank.


We fit the bill, what is next?



Besides meeting the checklist recommended, it is prudent to get a realtor to assist in crunching the numbers to check if this is a viable investment. Other than meeting the citerias, the choice of property is also very important when making this decision.


Using our A.C.E methodology, we would be able to assess the affordability and provide exit strategies that would lead towards your next home.


At Private Home Collection, getting your new property is just the first step as we guide you along your property journey in years to come.






Make an appointment with us here to arrange a complimentatory consultation using our A.C.E methodology at your convience to see if this strategy will work for you!



Always glad to be of service.













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