Thursday, July 3, 2008

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Jim Rogers Not Buying Singapore Property: Take a Cue from Jim Rogers ?

Mr Rogers, a billionaire who's made his money largely in trading commodities, moved to Singapore with his family last year and has chosen to rent a serviced apartment instead of buying into Singapore property. About why he is not buying Singapore property for now, he said, ‘I expect there to be a slowdown, if not a decline; it is happening already.’ - Business Times, 6 Mar 2008

The following is a forum exchange between Bull and Bear over whether to take the cue from Jim Rogers in the Singapore Property Forum :

Bear wrote:
Even Jim Rogers, the billionaire investor, is renting a serviced apartment and views the properties in Singapore as overpriced.

Bull wrote:
He bought tons of China shares last year, now can collect his ashes. Just another arrogant guy .... whole world must listen to them & they bring them to holand & hell.

Bear wrote:
In any case, he has made more money than you and his opinion counts....

Bull wrote:
Are you sure a billionaire investor will hold back his personal home purchase, and go for renting just because he thinks that ppty is overpriced? .... There are only two possibilities. First, he is simply trying to talk down the market for personal gain. Or, alternatively, he is not a billionaire, who can't even afford to lose a dollar for owning a house, and have to take such inconvinience path thru renting. Either way, for me, is very embarassing.

Bear wrote:
Well I am not surprised that even billionaire Jim Rogers will hold off buying properties in Singapore as he is expecting a major correction to happen soon not a minor one.

For people like Jim, he is definitely buying into prime penthouse condos. Imagine a penthouse in Orchard now asking for about S$30 million. If market corrected by 40%, that would mean a discount of S$12 million. Will a person of a sane mind, irregardless of how rich he is, wouldnt bother of losing S$12 million over just waiting for 1-2 years time?

Bull wrote:
A billionaire can't afford to lose $12 million for a house and rather go for renting?

Bear wrote:
Renting a posh penthouse the most will cost $25,000 a month. If you calculate in 2 years time it comes to $600,000. So it makes sense for people like Jim Rogers, whom not very sure whether he wants to stay put in Singapore, to rent rather than buy.

In addition, when you rent you dont have to worry on maintenance etc for the condo unit. Jim Rogers is not an idiot to allow himself to lose S$12 million over a $600,000 rental for the 2 years. What is confirmed is that property price will definitely go down by 40%. Or even 30% or 50%, But to a penthouse unit, it is worth double digit millions.

Bull wrote:
Look at Nasim Residence, 100% snapped up at average price of $3300 psf, rich getting richer, these rich know the value better than you, that is why snapped up. Jim Roger just came to Spore last year, at that point of time, he did not know to choose Shanghai, HK or Spore, later stage he wanted to live in Taipei. Now finally settled down in Spore. Once his rental contract over, he will buy now. Sure he already lose out, pay for few hundred thousands for 1 yr rental plus the price of property is up & not down for last 2-3 quarters.

May also want to read:
History of Singapore Property 1960 to 2008
Buy or Not Buy: How to decide amid mixed market signals
When to Buy, When Not to by
Property Price Index Graph Plotter & Online Property Valuation
Your Property Investment Determines Your Financial Success in Your Life
HDB Resales: West Sees Highest Price Increase


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The blogger here has been affectionately named by close allies as "Smart Buyer" but really, he's not smart. Smart Buyer just believes that being prudent is smart. That's the essence of the message of this blog and Smart Buyer hopes it'll benefit other property buyers.

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