Hi there!
Since purchasing a property isn't part of your immediate plans, I would focus on how you can manage your rental expenses more effectively over the next couple of years.
At $2,600 monthly, you're spending $31,200 annually on accommodation. That's a substantial commitment, particularly when you're also trying to build your savings.
However, I wouldn't automatically agree that renting means you're getting nothing in return.
You're paying for a roof over your heads, privacy, independence and the flexibility of not having to commit to a long-term mortgage.
The more important question is whether you're getting reasonable value for the rent you're paying.
**Firstly, don't assume your landlord will definitely increase the rent.**
Your lease still has approximately eight months remaining, and rental market conditions could change before renewal.
When the time comes, compare actual rental transactions for similar three-room flats in Woodlands rather than relying solely on advertised asking rents.
If you've been good tenants who pay promptly and maintain the property well, that could also work in your favour during negotiations.
From a landlord's perspective, retaining reliable tenants may be preferable to incurring marketing expenses, potential vacancy periods and the uncertainty of securing replacement tenants.
**Secondly, consider the actual cost of moving.**
Let's say your landlord proposes an increase of $150 monthly. That's an additional $1,800 over a year.
If relocating means paying for movers, taking time off work, engaging an agent where applicable and possibly paying more for another property, the savings from moving may not be as attractive as they initially appear.
Of course, if you can secure a comparable flat at a meaningfully lower rent, moving could make financial sense.
**Thirdly, make your next tenancy decision part of a longer-term savings plan.**
With $45,000 in combined savings, I would be more concerned about how much you're able to save consistently each month than whether you're paying an additional $100 or $200 in rent.
For example, if both of you can collectively save $1,500 monthly, that's another $18,000 annually, excluding interest.
Over two years, that would add $36,000 to your savings, assuming no withdrawals.
One final suggestion.
Don't wait until the last month of your tenancy before discussing renewal. Start monitoring the rental market a few months beforehand so you'll know whether your landlord's proposed rental is reasonable.
**My advice is not to make a rushed decision simply because your landlord has hinted at increasing the rent.**
You still have time to assess your options, negotiate and determine whether renewing or relocating makes better financial sense.
And while homeownership may not be feasible today, there's nothing wrong with working towards it gradually without putting unnecessary pressure on yourselves.
All the best!
Geryl Lim
CEA Reg No: R014783H
9278 7772
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