Asset Progression in Singapore

The term asset progression refers to the selling of 1 class of asset and moving to another one. Think about it like climbing a ladder. Some people call this upgrading, but why is it important to have a clear asset progression strategy?

By growing your wealth through asset progression, it gives you many financial options later in life. Would you like to own 2 properties by the time you retire? Majority of Singaporeans dream of owning 2 properties in Singapore. 1 for own stay and 2nd property to achieve rental income. If you did not plan early or do not know how to go about doing it, this option will not be available to you once you retire.

Asset progression in Singapore is not something new in the real estate market. Neither is it a fancy word for a property agent to influence people to sell their homes and get another one. Some Singaporeans have successfully made use of asset progression to create their retirement fund, and live happily ever after.

Why do I need an asset progression plan?

1. I have a nice house, which I am paying using CPF.
2. I have an emergency fund.
3. I spend within my means.

Yes, it’s great that you are prudent with your money. The issue is that majority of people are paying their house using their CPF. We are one of the few countries in the world, which allow its citizens to buy a house using our retirement fund.

Because we are allowed to use our CPF to finance our home, we will need to “payback” the amount of CPF we use plus the accrued interest after we sell our house. Accrued interest is the amount of interest your retirement account could have made if we do not use it.

Below is a classic example on how a couple who bought a 4 room HDB flat for $420,000 and sold it for $570,000 receive $0 cash.

Peter & Jane bought their HDB flat at $420,000. 9 years later when they sold it at $570,000, they thought that they had made about $150,000 ($570,000 – $420,000) …
However, to their horror, after paying back CPF and the accrued interest, they DID NOT GET A SINGLE CENT out of it!!!

How did this happen?
Let’s take a look at the calculations below


CPF pays you interest every year.
With most of your CPF OA savings used to pay for your house, the CPF usage still needs to generate the interest …
Who will pay the interest?
You will need to pay back that interest!
The higher the CPF accrued interest accumulated & compounded, means the lesser cash proceeds you will have after selling your HDB.

How Huge An Impact Could CPF Accrued Interest Be?

Let’s assume you have CPF OA savings of $200,000. Every year you could have earned 2.5% interest if you were to leave the money with CPF.
One day, you decide to use this your CPF OA to pay for your house.

From that moment:
You will STOP earning an interest of 2.5%.
Therefore, you will have to pay back the $200,000 plus the interest that you were supposed to earn when you sell your house.
For every $200,000 worth of CPF savings, at CPF interest rate of 2.5%
In 5 years, $200,000 will grow to $226,282
In 10 years, $200,000 will grow to $256,017
In 20 years, $200,000 will grow to $327,723

Do note that this CPF accrued interest will KEEP ON INCREASING even if you have fully paid off your mortgage loan.

Imagine one day you need a huge sum of money for child’s education fee, sudden emergencies, loss of income, retirement, etc. You thought that you could sell your HDB to get some cash.
After selling your HDB, you need to pay back the CPF accrued interest. This means you will receive lesser cash after selling your HDB.
Worst case scenario, the capital appreciation of your HDB is not high enough to cover the loss of interest … This will mean Negative Sales!
Unfortunately, downgrading may no longer be an option for you to get some cash when you need it the most!

Is Your HDB An Asset Or Liability?

Have you ever ask yourself if the HDB flat you own is an asset or a liability?
How many times have you heard your parents say they bought their house at $25,000 25 years ago and now it it worth $400,000? If the growth rate is going to be the same as before, your $400,000 HDB flat should be worth $6,400,000 in 25 years!

Do you think the prices will increase at the same rate in 25 years?
Do you think your children can afford a million-dollar flat in future?
What will the Singapore government do to prevent this from happening?

Let’s examine the graph of the HDB Resale Price Index. Most people who had bought their HDB flat before 2009, would have made a decent profit. But the question is, will it continue to be an asset? Let’s have a examine further.

HDB resale depreciating
Looking at the graph above, the HDB Resale Price Index has been on a decline since 2013, at a rate of 2.1% per year. I hate to say this, it seems like EVERY NIGHT THAT YOU SLEEP IN YOUR HDB, YOU ARE LOSING MONEY!

HDB sers scheme

More news below. Now, take note of the date of publication of the 3 articles from The Straits Time.

HDB flat depreciates
Notice that the date of the above 3 articles from Straits Time was in March, April and June 2017. Remember the date of the articles that were published, let us have a look at the graph below.

hdb vs pte
For your information:
HDB RPI = HDB Resale Price Index
PPI = Private Residential Property Price Index

Notice that the HDB RPI and PPI used to have a correlation with each other? Notice that pattern stopped in 2017 Quarter 3 onward, and went on a different direction, with PPI increasing and HDB RPI decreasing.

Do you notice that the period which the PPI and HDB RPI went on the opposite direction familiar? Yes, you may have noticed that the price index started going opposite direction after the 3 Straits Time articles were published, perhaps people start to realise that maybe HDB can’t be an asset after all. HDB IS DEPRECIATING WHILE THE PRIVATE CONDO IS APPRECIATING! What would happen if you continue to hold on to your HDB flat?

The main reason why HDB is depreciating is that it is meant for public housing and it is in the interest of the Singapore Government to keep it affordable for everyone. Be it now or for the future, it has to be affordable for the future generation.

Now that you realise the huge impact of accrued interest in your CPF and that holding on to your HDB property may not be your best option afterall.

“But if everybody is selling their BTOs to upgrade, who is left to buy our resale HDB?”

I believe that for every home, there is a buyer and a proud owner. There are many instances where people will still buy a resale HDB. Some examples include couples who do not qualify for a BTO due to the income ceiling criteria, people who have already upgraded and now want to fully pay off their home to live out their retirement days.

So what are your options after HDB MOP?

How do you proceed with asset progression?

Do you know that with a combined income of $7k onwards, many homeowners have upgraded from HDB to a condominium without touching their savings?

Let’s take a look at how some families could do it

Case study #1

Mr and Mrs Loh were owners of a 4 room HDB flat. Their plan was for me was sell their HDB and buy a resale Executive Maisonette.
But after I did a detailed financial calculation for them, they learnt a better way to build their assets and grow their wealth in the long term.
They have since upgraded to a condominium without using their cash savings, and even had a healthy cash savings of $150,000! With a well plan asset progression road map, they are even considering investing in a second property next year.

asset progression

Case study #2

My clients, Eric & Kelly, both with a combined income of $10k, sought my advice to sell their 2 bedroom condominium and as they want to upgrade to a bigger 3 bedroom condominium.
However, after I analyse their financials, they realise that they could achieve more than that. Today they own a 3 bedroom condo and a 1 bedroom apartment with a balance of $200k cash.
Due to their passive income collected from the rental of the 1 bedroom apartment, they are now paying lesser than they would have if they had just upgraded from a 2 bedroom condominium to a 3 bedroom condominium.

asset progression


Many people assume that certain types of property are out of their reach due to their income and age. They are limiting themselves, as there are solutions for every problem.
Some people have already missed their chance and wished I was there to advise them years ago.




ELEVATE your property into your Savings Plan
SAVE As You Earn
GENERATE passive income with minimal financial commitments
MAINTAIN a healthy amount of cash savings for rainy days
BUILD wealth for a secure & prosperous early retirement

Seize this opportunity and you can be one step closer to the lifestyle you have always dreamt of.

Let’s meet up for a NON-OBLIGATORY discussion and I will show you how I have helped many clients achieve their financial freedom.

Whatsapp Me

Hi! I am Shawn Kuah.

Coming from a modest background, I always strive to understand my clients’ concerns when it comes to property decisions such as upgrading. I strongly believe that property upgrading or investments can be safe and beneficial with the right planning.

My goal as a real estate professional is to equip homeowners with the right knowledge and ultimately empower them to make the right property decisions that will benefit them in future. I will always protect my clients’ interests at all times and give them the confidence to achieve asset progression.

Shawn showed us that we could make use of the profit from our HDB flat to upgrade our lifestyle, without using any of our savings. Initially, we don't think a million dollar property is even within our reach. However, with his meticulous planning, he made this possible for us.

Gabriel & Jane

On top of the financial calculations, Shawn also advised us on how to proportion our cash proceeds and CPF funds so there is reserve funds which can last us a few years if we have to stop working.

Alan & Jamie

I must say that Shawn was very attentive and manage all my fears and risks with precise planning and advice. I would definitely recommend him to my friends and relatives because I know he can give a professional advice.


Through this sharing session, you’ll know find out how asset progression can help you grow your wealth.

Let’s meet for a NON-OBLIGATORY & FREE sharing session today!


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