Saturday, November 29, 2008
About this Blog
By industry, unemployment rates rose for those previously employed in wholesale and retail trade, information and communications, financial services, as well as administrative and support services.
Most of the jobs created went to resident professionals, managers, executives and technicians - known as PMETs - who typically earn more. 'There were fewer residents employed in non-PMET jobs in manufacturing and services, but more in construction,' said the report, which attributed this partly to a more educated workforce.
Median monthly income for full-time employed residents jumped 11% to $2,590 this year, compared with 2007's rise of 7.7%. According to the report, this 'partly reflects the spillover effect from the strong economic performance last year and the higher proportion of PMETs among employed residents in 2008'. But adjusted for higher inflation, the growth in median monthly income was a smaller 4.6% compared with 2007's 5.5%.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Unemployment Rate Up at 3.3% in Sept 2008
SINGAPORE'S resident unemployment rate has risen from 2.4% last December to 3.1% in June and an estimated 3.3% in September this year, according to the latest Singapore Workforce 2008 report released by the Ministry of Manpower (MOM) yesterday. The report, based on a mid-2008 labour force survey, said that the higher unemployment rate reflects 'more cautious hiring sentiments amid the economic slowdown'.By industry, unemployment rates rose for those previously employed in wholesale and retail trade, information and communications, financial services, as well as administrative and support services.
Most of the jobs created went to resident professionals, managers, executives and technicians - known as PMETs - who typically earn more. 'There were fewer residents employed in non-PMET jobs in manufacturing and services, but more in construction,' said the report, which attributed this partly to a more educated workforce.
Median monthly income for full-time employed residents jumped 11% to $2,590 this year, compared with 2007's rise of 7.7%. According to the report, this 'partly reflects the spillover effect from the strong economic performance last year and the higher proportion of PMETs among employed residents in 2008'. But adjusted for higher inflation, the growth in median monthly income was a smaller 4.6% compared with 2007's 5.5%.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Thursday, November 27, 2008
About this Blog
Property market to soften
PROPERTY prices are set to soften and demand will weaken as the Singapore economy slows down, Minister for National Development Mah Bow Tan said on Wednesday evening. Private housing prices have declined by 2.4 per cent in the third quarter of this year, and further price movements will 'depend on the severity of the economic slowdown', he added. Speaking at the 49th anniversary dinner of the Real Estate Developers' Association of Singapore (REDAS) at the Shangri-La Hotel, Mr Mah said: 'Going forward, price movements will depend on the...ability of the industry to make adjustments in response to the changes in economic conditions.' The good news is that home-ownership rate is high in Singapore - at more than 90 per cent - and the government has an important role in ensuring the long-term stability and smooth functioning of the property market, he said. Among the measures it should take, he said, is to guard against 'irrational market behaviour such as excessive speculation that is not in sync with economic fundamentals.' But there are limits to what the government can do. The government cannot, for example, dictate to banks that they should extend loans to companies or individuals with weak financial standing. It also cannot work against market forces and try to prop up property prices artificially. Mr Mah explained: 'Such efforts are not sustainable and will not be beneficial to the health of the property market in the long-run. Any measure seen to be knee-jerk or excessive might even weigh market sentiment down further. 'It is in our interest to ensure that the property prices move in line with economic fundamentals, as it affects home ownership, asset values, retirement savings and other sectors of the economy.'
The situation is so obvious that the govt has never felt the need to say it. The speech is probably in response to the recent calls to prop up prices, and of course, it's a big NO because the fundamentals reveal a big property bubble. And bubbles have to burst before the economy can move ahead. The high housing cost makes Singapore business uncompetitive and the govt worries that FT are leaving. (Posted by Anonymous in the Singapore Property Forum)
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Developers want sales, Drop the Price
"There, official slap in the face for REDAS. Good riddance to their hubris. See what $2 COE has done for cars? You want sales, drop prices. "; was Ann's straight-forward response to the following news report (extracted from the Singapore Property Forum) :Property market to soften
PROPERTY prices are set to soften and demand will weaken as the Singapore economy slows down, Minister for National Development Mah Bow Tan said on Wednesday evening. Private housing prices have declined by 2.4 per cent in the third quarter of this year, and further price movements will 'depend on the severity of the economic slowdown', he added. Speaking at the 49th anniversary dinner of the Real Estate Developers' Association of Singapore (REDAS) at the Shangri-La Hotel, Mr Mah said: 'Going forward, price movements will depend on the...ability of the industry to make adjustments in response to the changes in economic conditions.' The good news is that home-ownership rate is high in Singapore - at more than 90 per cent - and the government has an important role in ensuring the long-term stability and smooth functioning of the property market, he said. Among the measures it should take, he said, is to guard against 'irrational market behaviour such as excessive speculation that is not in sync with economic fundamentals.' But there are limits to what the government can do. The government cannot, for example, dictate to banks that they should extend loans to companies or individuals with weak financial standing. It also cannot work against market forces and try to prop up property prices artificially. Mr Mah explained: 'Such efforts are not sustainable and will not be beneficial to the health of the property market in the long-run. Any measure seen to be knee-jerk or excessive might even weigh market sentiment down further. 'It is in our interest to ensure that the property prices move in line with economic fundamentals, as it affects home ownership, asset values, retirement savings and other sectors of the economy.'
The situation is so obvious that the govt has never felt the need to say it. The speech is probably in response to the recent calls to prop up prices, and of course, it's a big NO because the fundamentals reveal a big property bubble. And bubbles have to burst before the economy can move ahead. The high housing cost makes Singapore business uncompetitive and the govt worries that FT are leaving. (Posted by Anonymous in the Singapore Property Forum)
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
GDP down
Manufacturing down
Exports down
Tourism down
Hotels down
Jobs lost
Bonuses cut
FTs going home
Debts rising
Buyers not buying
Rents falling
Housing prices falling
Posted by Anonymous in the Singapore Property Forum.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Singapore Property Market Outlook in a Nutshell
SUMMARY:GDP down
Manufacturing down
Exports down
Tourism down
Hotels down
Jobs lost
Bonuses cut
FTs going home
Debts rising
Buyers not buying
Rents falling
Housing prices falling
Posted by Anonymous in the Singapore Property Forum.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Wednesday, November 26, 2008
About this Blog
MARKET crashes are the greatest redistributor of wealth. This has been true of previous crashes. But in the current turmoil, there are few beneficiaries, a friend noted. It is more a great destruction of wealth on a global scale so far.
Well, okay, some short-sellers may have profited from some of their trades. But many get wiped out in their next trade. Perhaps it is those who are not invested at all and who have the cash to pick through the carnage in the next few years who will really come out ahead. Who knows? Nobody is certain of anything anymore.
A lot of people have been hit hard this time around. There are a few reasons for this. One, prior to this, we've had four years of a bull market where prices had gone in only one direction. Success, notes a friend, is one of life's worst enemies. It engenders overconfidence and, as a result, one tends to let down one's guard - in some instances, to the extent of recklessness. Economist Hyman Minsky sees the cycle of risk-taking in the economy as following a pattern: stability and absence of crises encourage risk-taking, complacency, and lowered awareness of the possibility of problems.
But even for those who are conservative and have their heads centred and feet firmly planted on the ground, the economics just a few months back suggested that being invested was the right course of action. Then, inflation was running at 5 or 6 per cent and banks' interest rates were at less than one per cent.
For someone who didn't want to have his or her purchasing power eroded, keeping the money in the bank wasn't the most logical of options. Which was why a lot of people are invested - and, worse, a lot took loans to invest. If the borrowing cost was so low, and one was expecting to make a return higher than that cost of borrowing, it made sense to borrow.
Of course, we know now that a lot of people had underestimated or even ignored the risk of trying to earn those extra percentage points of returns.
Continue with: 'Lessons learnt from many investments that have gone wrong ..real life stories'
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Property Buyers and Investors, Know the Risk of Leveraging
Current turmoil has few beneficiaries
MARKET crashes are the greatest redistributor of wealth. This has been true of previous crashes. But in the current turmoil, there are few beneficiaries, a friend noted. It is more a great destruction of wealth on a global scale so far.
Well, okay, some short-sellers may have profited from some of their trades. But many get wiped out in their next trade. Perhaps it is those who are not invested at all and who have the cash to pick through the carnage in the next few years who will really come out ahead. Who knows? Nobody is certain of anything anymore.
Why people have been hit hard this time around?
A lot of people have been hit hard this time around. There are a few reasons for this. One, prior to this, we've had four years of a bull market where prices had gone in only one direction. Success, notes a friend, is one of life's worst enemies. It engenders overconfidence and, as a result, one tends to let down one's guard - in some instances, to the extent of recklessness. Economist Hyman Minsky sees the cycle of risk-taking in the economy as following a pattern: stability and absence of crises encourage risk-taking, complacency, and lowered awareness of the possibility of problems.
High Inflation, Low Interest Suggested Being Invested
But even for those who are conservative and have their heads centred and feet firmly planted on the ground, the economics just a few months back suggested that being invested was the right course of action. Then, inflation was running at 5 or 6 per cent and banks' interest rates were at less than one per cent.
For someone who didn't want to have his or her purchasing power eroded, keeping the money in the bank wasn't the most logical of options. Which was why a lot of people are invested - and, worse, a lot took loans to invest. If the borrowing cost was so low, and one was expecting to make a return higher than that cost of borrowing, it made sense to borrow.
Of course, we know now that a lot of people had underestimated or even ignored the risk of trying to earn those extra percentage points of returns.
Continue with: 'Lessons learnt from many investments that have gone wrong ..real life stories'
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
A friend shared with me some of the horrendous stories of how an enormous amount of wealth was destroyed in the last few months.
Up till last year, one man had $100 million of his worth in only one stock. Towards the end of last year, that stock started to decline. By early this year, the stock was down more than 50 per cent from its peak just a few months before. The man picked up quite a few additional shares - on margin - thinking that the stock had bottomed and would eventually rebound. Since then, the stock has plunged by another 80 per cent. The $100 million is more than wiped out! The stock is Cosco Corp, which went from 10 cents in March 2003 to $8.20 in October last year - an 82 times jump. It is now trading at less than 70 cents.
Another guy had relatively much more modest means. His net worth was estimated at $2-3 million. He heard from 'reliable' sources that a particular company would be taken over by another at a significantly higher price than the stock's then market price. He bet all he had and, if I remember correctly, also took margin financing to buy that stock. The stock was FerroChina, which has since been suspended because it had run out of money to pay its suppliers and debtors.
One value investor thought Thailand was cheap a few years back. One particular company, a very big one, was trading at 1.2 baht - significantly below its book value. The investor concentrated his bet on that company. And, indeed, the market began to recognise the value of the company and the stock tripled to over 3 baht. The value investor's portfolio grew to $26 million. In the last year or so, the stock has plunged to below 0.7 baht. The investor is now down some 50 per cent on his original capital.
Another man was shrewd enough to think that the market was overvalued towards the end of 2007. So he got out of the market, and even shorted it. He was happy that the market went the way he predicted. He was the smartest guy in town.
By June or July, thinking that the market had fallen enough, he loaded up on shares. Like the guys above, he too used margin financing to pick up the shares. As we know, the market took an even more severe turn in September and October. He too was dealt a severe blow.
A friend was also bearish about the market towards the end of last year. He had put in some shorts. Then last October, the market went on to hit record highs. He lost his resolve, and reversed his trades and got hit as well.
Another made quite a bit of money in the Singapore market. His confidence grew. He wanted a bigger stage. He bought US shares on margin. US stocks took a precipitous plunge a few months back. He has had a few rounds of margin calls.
A young banker in his late 20s made $2-3 million from the property market in the last few years. He ploughed all the profits into a $10 million property, and took loans of some $7 million. He's now saddled with a mortgage payment of some $30,000 a month.
Many of the real-life examples above show just how lethal leverage can be. In a rising market, leverage is your friend; in a down market, the blow dealt by leverage can knock one out for good.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Tales of fortunes made and lost in recessions
Riches gone in a flash
A friend shared with me some of the horrendous stories of how an enormous amount of wealth was destroyed in the last few months.
Up till last year, one man had $100 million of his worth in only one stock. Towards the end of last year, that stock started to decline. By early this year, the stock was down more than 50 per cent from its peak just a few months before. The man picked up quite a few additional shares - on margin - thinking that the stock had bottomed and would eventually rebound. Since then, the stock has plunged by another 80 per cent. The $100 million is more than wiped out! The stock is Cosco Corp, which went from 10 cents in March 2003 to $8.20 in October last year - an 82 times jump. It is now trading at less than 70 cents.
He bet all he had
Another guy had relatively much more modest means. His net worth was estimated at $2-3 million. He heard from 'reliable' sources that a particular company would be taken over by another at a significantly higher price than the stock's then market price. He bet all he had and, if I remember correctly, also took margin financing to buy that stock. The stock was FerroChina, which has since been suspended because it had run out of money to pay its suppliers and debtors.
The value investor
One value investor thought Thailand was cheap a few years back. One particular company, a very big one, was trading at 1.2 baht - significantly below its book value. The investor concentrated his bet on that company. And, indeed, the market began to recognise the value of the company and the stock tripled to over 3 baht. The value investor's portfolio grew to $26 million. In the last year or so, the stock has plunged to below 0.7 baht. The investor is now down some 50 per cent on his original capital.
The Smartest Guy In Town
Another man was shrewd enough to think that the market was overvalued towards the end of 2007. So he got out of the market, and even shorted it. He was happy that the market went the way he predicted. He was the smartest guy in town.
By June or July, thinking that the market had fallen enough, he loaded up on shares. Like the guys above, he too used margin financing to pick up the shares. As we know, the market took an even more severe turn in September and October. He too was dealt a severe blow.
The Investor who Reversed His Trades
A friend was also bearish about the market towards the end of last year. He had put in some shorts. Then last October, the market went on to hit record highs. He lost his resolve, and reversed his trades and got hit as well.
The Investor Who Made Money, His confidence Grew
Another made quite a bit of money in the Singapore market. His confidence grew. He wanted a bigger stage. He bought US shares on margin. US stocks took a precipitous plunge a few months back. He has had a few rounds of margin calls.
The Young Banker Investor Saddled With Huge Mortgage
A young banker in his late 20s made $2-3 million from the property market in the last few years. He ploughed all the profits into a $10 million property, and took loans of some $7 million. He's now saddled with a mortgage payment of some $30,000 a month.
Many of the real-life examples above show just how lethal leverage can be. In a rising market, leverage is your friend; in a down market, the blow dealt by leverage can knock one out for good.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Friday, November 21, 2008
About this Blog
Some property industry players are yearning for the good old days, hoping the government will reverse some of the changes in property policies made in the past two years and thus go beyond the usual exemptions and rebates on property taxes with its off-Budget/Budget packages.
Such a strategy may be timely in helping to stimulate currently flagging property demand given that the measures were rolled out when the market was sparkling.
Developers are hoping the government will reinstate the deferment of stamp duty on property purchases where the property is under development (this was removed in December 2006) and revert to the old formula for computing development charge (DC) rates, based on 50 per cent of the appreciation in land value arising from changing the use of a site or building a bigger project on it. This was raised to 70 per cent in July last year.
Following the December 2006 rule change on stamp duty, property buyers are now required to pay stamp duty within 14 days from the date that the option to purchase is accepted.
The previous concession, introduced in June 1998, had allowed stamp duty payment to be deferred to the date of issuance of Temporary Occupation Permit for a project or date of sale of interest in the property, whichever was earlier, for properties under development.
Deferring payment of stamp duty for projects under development once more would lower upfront cash commitment for home buyers, some of whom may be stretched, especially since it could take a few years for the new homes they've bought to be completed, says Knight Frank managing director Tan Tiong Cheng.
Most developers are hoping the government will reinstate the DPS. They say DPS helped genuine home buyers, especially upgraders who may be able to sell their existing homes only when their new private home has been built.
Also high on the developers' wish-list is a revival of the deferred payment scheme (DPS) - which was scrapped in October last year - to boost home purchases, with a qualifier that safeguards be introduced to address concerns that such schemes had spurred speculation.
Although developers are currently not in a race to redevelop their sites given the property slump, many argue that going back to the pre-July 2007 formula for computing DC rates - which creamed off a smaller portion of the enhancement in land value - 'would provide greater incentive for land owners to explore more productive use for their properties and could spur some activity', the head of a listed property group said.
A major property developer also suggested a demand-boosting measure in the form of changing the investment criteria for Economic Development Board's Global Investor Programme to allow a higher quantum for property purchase or even lowering the total threshold value.
Under a new option to the Programme announced in July 2005, a foreigner can be considered for permanent resident status if he invests at least $2 million in business set-ups, other investment vehicles, and/or private residential properties, with up to half of the investment allowed in private residential properties.
'More people taking up permanent residence or citizenship and landing on our shores will help the property market,' said the developer.
KPMG Tax Services executive director Leonard Ong said that granting exemptions or rebates on property taxes for completed commercial and industrial buildings will help landlords and hopefully they will pass on some of the savings to their tenants.
'Earlier this year, when property prices were on the rise, the government also raised Annual Values of properties. So based on this, owners would be paying more property taxes than last year. This makes it all the more important to introduce exemptions or rebates for property taxes,' he added. Property tax is calculated as a percentage of a property's annual value.
Developers are also hoping for property tax exemption for vacant land and land under development to reduce costs.
'During this period, the market is so quiet we cannot launch projects,' notes Ho Bee Investment chairman and CEO Chua Thian Poh.
Ho Bee's Mr Chua suggests modifications be made to DPS to allay concerns that it also facilitated speculation in the past.
'The most important thing is to require the buyer to secure a housing loan even if he does not need to draw down the loan immediately, to ensure a credit assessment of the buyer is done by the banks,' he said.
However, Ho Bee's Mr Chua disagreed with the suggestion by some analysts that the initial payment by the buyer - before the deferred payment kicks in - be raised from 10-20 per cent previously to 30 per cent, as that 'would not help home buyers much'.
Developers are also concerned about banks tightening financing to home buyers and to businesses in general, and hope the Monetary Authority of Singapore will use 'moral suasion' to send the right signal to banks.
Source: B.T. Published November 19, 2008
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Developers want govt to turn back clock on several policies
Wish-list includes reinstatement of deferred payment, old formula for DC
Some property industry players are yearning for the good old days, hoping the government will reverse some of the changes in property policies made in the past two years and thus go beyond the usual exemptions and rebates on property taxes with its off-Budget/Budget packages.
Such a strategy may be timely in helping to stimulate currently flagging property demand given that the measures were rolled out when the market was sparkling.
Deferment of stamp duty until TOP
Developers are hoping the government will reinstate the deferment of stamp duty on property purchases where the property is under development (this was removed in December 2006) and revert to the old formula for computing development charge (DC) rates, based on 50 per cent of the appreciation in land value arising from changing the use of a site or building a bigger project on it. This was raised to 70 per cent in July last year.
Following the December 2006 rule change on stamp duty, property buyers are now required to pay stamp duty within 14 days from the date that the option to purchase is accepted.
The previous concession, introduced in June 1998, had allowed stamp duty payment to be deferred to the date of issuance of Temporary Occupation Permit for a project or date of sale of interest in the property, whichever was earlier, for properties under development.
Deferring payment of stamp duty for projects under development once more would lower upfront cash commitment for home buyers, some of whom may be stretched, especially since it could take a few years for the new homes they've bought to be completed, says Knight Frank managing director Tan Tiong Cheng.
Most developers are hoping the government will reinstate the DPS. They say DPS helped genuine home buyers, especially upgraders who may be able to sell their existing homes only when their new private home has been built.
Revival of the deferred payment scheme
Also high on the developers' wish-list is a revival of the deferred payment scheme (DPS) - which was scrapped in October last year - to boost home purchases, with a qualifier that safeguards be introduced to address concerns that such schemes had spurred speculation.
Old formula for DC
Although developers are currently not in a race to redevelop their sites given the property slump, many argue that going back to the pre-July 2007 formula for computing DC rates - which creamed off a smaller portion of the enhancement in land value - 'would provide greater incentive for land owners to explore more productive use for their properties and could spur some activity', the head of a listed property group said.
Economic Development Board's Global Investor Programme to allow a higher quantum for property purchase
A major property developer also suggested a demand-boosting measure in the form of changing the investment criteria for Economic Development Board's Global Investor Programme to allow a higher quantum for property purchase or even lowering the total threshold value.
Under a new option to the Programme announced in July 2005, a foreigner can be considered for permanent resident status if he invests at least $2 million in business set-ups, other investment vehicles, and/or private residential properties, with up to half of the investment allowed in private residential properties.
'More people taking up permanent residence or citizenship and landing on our shores will help the property market,' said the developer.
Exemptions or rebates on property taxes for completed commercial and industrial buildings
KPMG Tax Services executive director Leonard Ong said that granting exemptions or rebates on property taxes for completed commercial and industrial buildings will help landlords and hopefully they will pass on some of the savings to their tenants.
'Earlier this year, when property prices were on the rise, the government also raised Annual Values of properties. So based on this, owners would be paying more property taxes than last year. This makes it all the more important to introduce exemptions or rebates for property taxes,' he added. Property tax is calculated as a percentage of a property's annual value.
Property tax exemption for vacant land and land under development
Developers are also hoping for property tax exemption for vacant land and land under development to reduce costs.
'During this period, the market is so quiet we cannot launch projects,' notes Ho Bee Investment chairman and CEO Chua Thian Poh.
Require the buyer to secure a housing loan
Ho Bee's Mr Chua suggests modifications be made to DPS to allay concerns that it also facilitated speculation in the past.
'The most important thing is to require the buyer to secure a housing loan even if he does not need to draw down the loan immediately, to ensure a credit assessment of the buyer is done by the banks,' he said.
However, Ho Bee's Mr Chua disagreed with the suggestion by some analysts that the initial payment by the buyer - before the deferred payment kicks in - be raised from 10-20 per cent previously to 30 per cent, as that 'would not help home buyers much'.
Developers are also concerned about banks tightening financing to home buyers and to businesses in general, and hope the Monetary Authority of Singapore will use 'moral suasion' to send the right signal to banks.
Source: B.T. Published November 19, 2008
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
Highlight:
MTI has also revised Singapore GDP Forecast from 3% to 2.5%.
MTI said Singapore economy is likely to face a broadbase slowdown in 2009. It has forecasted Singapore GDP Forecast for 2009 between -1% to 2%.
MTI has revised the forecasted inflation rate for 2009 from 2.5%-3.5% to 1%-2%.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Singapore's GDP contracted by 0.6% in 3Q2008: MTI's GDP 2008 Forecast Reduce to 2.5%, 2009 Economic Growth -1% to 2%
The Performance of the Singapore Economy for 3rd Qtr 2008 has been released today by MTI. Singapore's GDP contracted by 0.6%, lower than the earlier estimate of 0.5%, with the largest contraction coming from the manufacturing sectorHighlight:
Singapore GDP Forecast for 2008 reduce to 2.5%
MTI has also revised Singapore GDP Forecast from 3% to 2.5%.
Singapore GDP Forecast for 2009 between -1% to 2%.
MTI said Singapore economy is likely to face a broadbase slowdown in 2009. It has forecasted Singapore GDP Forecast for 2009 between -1% to 2%.
Inflation in 2009 to decline
MTI has revised the forecasted inflation rate for 2009 from 2.5%-3.5% to 1%-2%.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Wednesday, November 19, 2008
About this Blog
It stressed that long-term measures to help these owners manage their mortgage payment is the best solution, and that compulsory acquisition of the flat is a last resort.
As of October 2008, some 33,000 flat owners owed HDB arrears of three months or more. They make up less than 8 per cent of the 420,000 households with outstanding HDB loans.
Giving this update in Parliament on Tuesday, Parliamentary Secretary for National Development Mohamad Maliki Osman said home owners should buy within their means.
But he recognised that there are some who are affected by the economic downturn and one option for them is to downgrade to a smaller unit.
More 2 and 3-room HDB flats will be coming on stream next year to cope with the growing demand for smaller flats.
Dr Maliki also said heavily subsidised rental flats should be given to those who are in dire need. - CNA
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
HDB Mortgage Defaults Up 33,000 in October: More 2-room HDB flats to be built
The Housing and Development Board (HDB) will continue to keep tabs on flat owners who default on their HDB mortgage payments.It stressed that long-term measures to help these owners manage their mortgage payment is the best solution, and that compulsory acquisition of the flat is a last resort.
As of October 2008, some 33,000 flat owners owed HDB arrears of three months or more. They make up less than 8 per cent of the 420,000 households with outstanding HDB loans.
Giving this update in Parliament on Tuesday, Parliamentary Secretary for National Development Mohamad Maliki Osman said home owners should buy within their means.
But he recognised that there are some who are affected by the economic downturn and one option for them is to downgrade to a smaller unit.
More 2 and 3-room HDB flats will be coming on stream next year to cope with the growing demand for smaller flats.
Dr Maliki also said heavily subsidised rental flats should be given to those who are in dire need. - CNA
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Tuesday, November 18, 2008
About this Blog
Bull is getting increasingly marginalised. Even buyers are backing out.
About 50 homebuyers walked away from deals in October
Business Times - 18 Nov 2008
But trend not likely to escalate as it was a month when bourses tanked
THE number of private homes returned to developers shot up last month on the back of a sharp dive in confidence due to the stockmarket crash.
Homebuyers returned 50-odd units to developers in October, compared with 10-plus units each in the preceding month and in October last year. The figures were estimated by BT from statistics on developers’ sales released by the Urban Redevelopment Authority (URA) yesterday. The figures exclude executive condos.
October also saw developers launching and selling the lowest number of private homes since URA started making monthly housing sales data available in June last year. Developers sold 112 private homes in October, down about 70 per cent from 376 units in the preceding month and 80 per cent below the 566 units sold in October last year. The 159 private homes developers launched last month was also 79 per cent lower than September and 75 per cent below that in the same year-ago period.
Buyers who returned the 50-plus units last month probably did so before the options were due to be exercised, industry observers reckon. Buyers who walk away from a deal before the option is exercised forfeit a quarter of the 5 per cent option fee, equivalent to 1.25 per cent of the purchase price of the unit.
‘The stock market was at its worst in October. So some buyers may have got jittery and decided it was better to forego 1.25 per cent of the purchase price - that’s $12,500 for a $1 million property purchase - than to be saddled with uncertainty. They worry that property prices may drop much further in the next six months. So it’s a matter of weighing risks, even for people who can afford to take the hit,’ said a seasoned property agent.
Another industry observer said another factor for the forfeitures could be if buyers failed to secure the required quantum of housing loan from banks, which have become more cautious in lending. ‘Some buyers may also have observed developers trimming prices and got cold feet,’ he added.
On a brighter note, he does not expect the number of units returned to developers to keep rising in the months ahead. ‘Anybody who buys now must have done his homework. Things are a lot clearer now.’
Agreeing, DTZ executive director Ong Choon Fah said: ‘October was an exceptional month with so much stockmarket turmoil and fear all around. Hopefully, we won’t get a repeat of this. People will be much more considered when buying homes henceforth and therefore the number of units returned should revert to a more normal situation.’
October saw a total of 14 units returned at Concourse Skyline at Beach Road, 11 units at The Peak @ Balmeg in the Pasir Panjang area and five units each at Silversea at Amber Road, Tresalveo at Marymount Terrace and VIVA at Thomson Road/Suffolk Walk. Nonetheless, all these projects still saw units being sold in October.
CB Richard Ellis (CBRE) said, based on transacted prices, prices have ‘remained fairly stable for the past two months, with due consideration that factors such as floor height, orientation and liveable space affect prices’.
‘However, it is very likely that the persistent thin volume will have a downward effect on prices. The sluggish sales momentum is likely to remain for the rest of the year as macro factors such as the economic recession and retrenchment will erode consumer confidence,’ CBRE’s executive director Li Hiaw Ho added. He predicts Q4 may see sales volume of around 500 units, a level last seen in Q1 2003.
Knight Frank director Nicholas Mak said that homebuying sentiment is expected to weaken in the face of economic and job market uncertainties. ‘Launches are expected to be held back till at least after Chinese New Year 2009,’ he added. The lowest-priced apartment/condo sold in October was a unit at The Linear ($554 psf) while the highest-priced unit was an apartment at Orchard Scotts ($2,407 psf).
Savills Singapore’s Ku Swee Yong noted that despite a weak month, The Lakeshore in Jurong and Hillvista in the Hillview area crossed $1,000 psf. The $2,169 psf of land area achieved at Sandy Island on Sentosa Cove is probably the highest price for a landed home in Singapore, he added.
Around 63 per cent of the 112 units sold in October were in Outside Central Region. However, in terms of the 159 units launched in the month, the lion’s share (46.5 per cent) were in the Core Central Region.
Posted by Anonymous in the Singapore Property Forum
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Private Property Buyers Backing Out of Sale for Concourse Skyline, The Peak @ Balmeg, Silversea @ Amber, Tresalveo at Marymount, VIVA @ Thomson
Goodness, developers sold 112 units in October, and 50 got returned!Bull is getting increasingly marginalised. Even buyers are backing out.
About 50 homebuyers walked away from deals in October
Business Times - 18 Nov 2008
But trend not likely to escalate as it was a month when bourses tanked
THE number of private homes returned to developers shot up last month on the back of a sharp dive in confidence due to the stockmarket crash.
Homebuyers returned 50-odd units to developers in October, compared with 10-plus units each in the preceding month and in October last year. The figures were estimated by BT from statistics on developers’ sales released by the Urban Redevelopment Authority (URA) yesterday. The figures exclude executive condos.
October also saw developers launching and selling the lowest number of private homes since URA started making monthly housing sales data available in June last year. Developers sold 112 private homes in October, down about 70 per cent from 376 units in the preceding month and 80 per cent below the 566 units sold in October last year. The 159 private homes developers launched last month was also 79 per cent lower than September and 75 per cent below that in the same year-ago period.
Buyers who returned the 50-plus units last month probably did so before the options were due to be exercised, industry observers reckon. Buyers who walk away from a deal before the option is exercised forfeit a quarter of the 5 per cent option fee, equivalent to 1.25 per cent of the purchase price of the unit.
‘The stock market was at its worst in October. So some buyers may have got jittery and decided it was better to forego 1.25 per cent of the purchase price - that’s $12,500 for a $1 million property purchase - than to be saddled with uncertainty. They worry that property prices may drop much further in the next six months. So it’s a matter of weighing risks, even for people who can afford to take the hit,’ said a seasoned property agent.
Another industry observer said another factor for the forfeitures could be if buyers failed to secure the required quantum of housing loan from banks, which have become more cautious in lending. ‘Some buyers may also have observed developers trimming prices and got cold feet,’ he added.
On a brighter note, he does not expect the number of units returned to developers to keep rising in the months ahead. ‘Anybody who buys now must have done his homework. Things are a lot clearer now.’
Agreeing, DTZ executive director Ong Choon Fah said: ‘October was an exceptional month with so much stockmarket turmoil and fear all around. Hopefully, we won’t get a repeat of this. People will be much more considered when buying homes henceforth and therefore the number of units returned should revert to a more normal situation.’
October saw a total of 14 units returned at Concourse Skyline at Beach Road, 11 units at The Peak @ Balmeg in the Pasir Panjang area and five units each at Silversea at Amber Road, Tresalveo at Marymount Terrace and VIVA at Thomson Road/Suffolk Walk. Nonetheless, all these projects still saw units being sold in October.
CB Richard Ellis (CBRE) said, based on transacted prices, prices have ‘remained fairly stable for the past two months, with due consideration that factors such as floor height, orientation and liveable space affect prices’.
‘However, it is very likely that the persistent thin volume will have a downward effect on prices. The sluggish sales momentum is likely to remain for the rest of the year as macro factors such as the economic recession and retrenchment will erode consumer confidence,’ CBRE’s executive director Li Hiaw Ho added. He predicts Q4 may see sales volume of around 500 units, a level last seen in Q1 2003.
Knight Frank director Nicholas Mak said that homebuying sentiment is expected to weaken in the face of economic and job market uncertainties. ‘Launches are expected to be held back till at least after Chinese New Year 2009,’ he added. The lowest-priced apartment/condo sold in October was a unit at The Linear ($554 psf) while the highest-priced unit was an apartment at Orchard Scotts ($2,407 psf).
Savills Singapore’s Ku Swee Yong noted that despite a weak month, The Lakeshore in Jurong and Hillvista in the Hillview area crossed $1,000 psf. The $2,169 psf of land area achieved at Sandy Island on Sentosa Cove is probably the highest price for a landed home in Singapore, he added.
Around 63 per cent of the 112 units sold in October were in Outside Central Region. However, in terms of the 159 units launched in the month, the lion’s share (46.5 per cent) were in the Core Central Region.
Posted by Anonymous in the Singapore Property Forum
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Monday, November 17, 2008
About this Blog
URA quaterly report for past quarters compared to October:
2Q: 1417 (sold), 1814 (launched)
3Q: 1814 (sold), 2244(launched)
October: 112 sold, 159 launched
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Private Property Sales Fell 70% in October
According to URA latest data, developers sold just 112 private homes in October, down from 376 units in September. 159 private homes were launched in October, a fifth of the 767 units they released in September. The fall was not unexpected given the upheaval in Wall Street banks in late september to october which saw the Fed's rescue of Freddie Mac and Fannie Mae, the near-collapse of AIG, and the bankruptcy of Lehman.URA quaterly report for past quarters compared to October:
2Q: 1417 (sold), 1814 (launched)
3Q: 1814 (sold), 2244(launched)
October: 112 sold, 159 launched
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
Nov 16, 2008
Home loans harder to get as prices fall
Check if bank can meet unit's valuation to avoid overpaying for the property
A couple of telling anecdotes illustrate the unexpected glitches that home buyers can face as property prices start to fall.
A Spring Grove condominium unit owner was denied the chance to take advantage of lower interest rates by refinancing his devalued property without coughing up more hard-earned cash.
The owner had to make up the shortfall because the reduced value of the Grange Road unit meant the bank could not extend a large enough loan.
Another buyer had to cancel his purchase recently after he learnt that banks' valuation of the property was less than what he was supposed to pay.
The banks could not offer him the loan he needed as the collateral was inadequate.
This is the brave new world of home loans as property values fall amid the global financial crisis and banks tighten lending.
Banks are still dishing out home loans but are much more selective these days, mortgage consultants said.
Banks can grant only up to 90 per cent of the purchase price or valuation, whichever is lower. So if the sale price of a property exceeds the valuation - which is determined by an independent professional - the buyer will have to make up the shortfall.
Amid poor demand and falling prices, banks are sticking to lower property valuations in anticipation of further price falls.
'OCBC Bank engages independent, third-party valuers to determine the open market value of properties and there has been evidence of a fairly strong downward trend in property valuation,' said its head of consumer secured lending Gregory Chan.
The buyer who cancelled his property deal realised that the yet-to-be-completed 1,000 sq ft condo unit was worth less than the $2 million he was going to pay.
'No bank can match the property's valuation as there was a recent sub-sale deal done at 15 per cent below the developers' price of $2,000 per sq ft,' said Mr Dennis Ng, spokesman for mortgage consultancy portal www.HousingLoanSG.com
Buyers can avoid overpaying for a property by checking to see if the banks can match the valuation to the property's purchase price, he said.
In today's market, those still keen on taking out a loan for a home they intend to live in should also know that most banks now prefer to offer up to only 80 per cent financing, said Ms Ally Yang, a chief mortgage consultant at www.homeloan.com.sg
OCBC Bank said it continues to offer housing loan packages for 80 per cent financing. It also offers 90 per cent financing on a case-by-case basis if the applicant meets its credit assessment criteria.
HSBC Singapore's head of personal financial services, Mr Sebastian Arcuri, said: 'Customers can still obtain home loans of up to 90 per cent valuation or purchase price if their financial profile can support it and their application meets the bank's criteria.'
But there are signs that banks are starting to be more stringent in their credit criteria and they are very selective in granting a 90 per cent loan, said Mr Ng.
'A 90 per cent home loan is now more selectively granted to consumers with very good profile who are buying a property as their first home.'
Investors will find it tougher to get a bigger loan these days. Banks used to offer more than 85 per cent financing for investment properties but all of them, except DBS Bank, no longer do so, said Ms Yang.
This means buyers have to be prepared to cough up more cash for investment property buys.
Those looking at refinancing may be in for a surprise if they bought their properties in last year's booming market.
The Spring Grove unit in question was bought by a South Korean expatriate for $2.58 million or $1,442 per sq ft on a floating rate package.
He now pays 3.5 per cent interest on his 80 per cent loan and was looking to halve his interest payments by switching to a package pegged to the three- month Singapore Interbank Offered Rate, said Ms Yang.
But a check with two banks found that the valuation for his property was $2 million or $2.22 million. If he wants to refinance at these valuations, he would need to pay up to $180,000 to top up his loan, currently at $1.78 million.
Consumers seeking a loan for their property purchase should get prior approval or have more cash on hand. 'They should approach a mortgage specialist for a joint assessment if they are unsure whether they can afford the home purchase,' said OCBC's Mr Chan.
'Things are quite fluid these days so buyers should re-check their loan eligibility after one month,' said Mr Ng.
Posted by Anonymouse in the Singapore Property Forum
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Home loans harder to get as property prices fall
If you had read the article below, this is the same events that is going on in US mortgage market. Banks had turn very conservative in lending and it is not due to the shrinking money supply but rather fear, and it is a feature of depression economics when the normal monetary tools (i.e lowering interest rates) are not working anymore....Fyi, the SIBOR rate is now 1.25% and yet banks are afraid to over-stretch themselves...Conclusion is less transaction (let's just wait for the 08 4th quarter figures) and dropping prices...Nov 16, 2008
Home loans harder to get as prices fall
Check if bank can meet unit's valuation to avoid overpaying for the property
A couple of telling anecdotes illustrate the unexpected glitches that home buyers can face as property prices start to fall.
A Spring Grove condominium unit owner was denied the chance to take advantage of lower interest rates by refinancing his devalued property without coughing up more hard-earned cash.
The owner had to make up the shortfall because the reduced value of the Grange Road unit meant the bank could not extend a large enough loan.
Another buyer had to cancel his purchase recently after he learnt that banks' valuation of the property was less than what he was supposed to pay.
The banks could not offer him the loan he needed as the collateral was inadequate.
This is the brave new world of home loans as property values fall amid the global financial crisis and banks tighten lending.
Banks are still dishing out home loans but are much more selective these days, mortgage consultants said.
Banks can grant only up to 90 per cent of the purchase price or valuation, whichever is lower. So if the sale price of a property exceeds the valuation - which is determined by an independent professional - the buyer will have to make up the shortfall.
Amid poor demand and falling prices, banks are sticking to lower property valuations in anticipation of further price falls.
'OCBC Bank engages independent, third-party valuers to determine the open market value of properties and there has been evidence of a fairly strong downward trend in property valuation,' said its head of consumer secured lending Gregory Chan.
The buyer who cancelled his property deal realised that the yet-to-be-completed 1,000 sq ft condo unit was worth less than the $2 million he was going to pay.
'No bank can match the property's valuation as there was a recent sub-sale deal done at 15 per cent below the developers' price of $2,000 per sq ft,' said Mr Dennis Ng, spokesman for mortgage consultancy portal www.HousingLoanSG.com
Buyers can avoid overpaying for a property by checking to see if the banks can match the valuation to the property's purchase price, he said.
In today's market, those still keen on taking out a loan for a home they intend to live in should also know that most banks now prefer to offer up to only 80 per cent financing, said Ms Ally Yang, a chief mortgage consultant at www.homeloan.com.sg
OCBC Bank said it continues to offer housing loan packages for 80 per cent financing. It also offers 90 per cent financing on a case-by-case basis if the applicant meets its credit assessment criteria.
HSBC Singapore's head of personal financial services, Mr Sebastian Arcuri, said: 'Customers can still obtain home loans of up to 90 per cent valuation or purchase price if their financial profile can support it and their application meets the bank's criteria.'
But there are signs that banks are starting to be more stringent in their credit criteria and they are very selective in granting a 90 per cent loan, said Mr Ng.
'A 90 per cent home loan is now more selectively granted to consumers with very good profile who are buying a property as their first home.'
Investors will find it tougher to get a bigger loan these days. Banks used to offer more than 85 per cent financing for investment properties but all of them, except DBS Bank, no longer do so, said Ms Yang.
This means buyers have to be prepared to cough up more cash for investment property buys.
Those looking at refinancing may be in for a surprise if they bought their properties in last year's booming market.
The Spring Grove unit in question was bought by a South Korean expatriate for $2.58 million or $1,442 per sq ft on a floating rate package.
He now pays 3.5 per cent interest on his 80 per cent loan and was looking to halve his interest payments by switching to a package pegged to the three- month Singapore Interbank Offered Rate, said Ms Yang.
But a check with two banks found that the valuation for his property was $2 million or $2.22 million. If he wants to refinance at these valuations, he would need to pay up to $180,000 to top up his loan, currently at $1.78 million.
Consumers seeking a loan for their property purchase should get prior approval or have more cash on hand. 'They should approach a mortgage specialist for a joint assessment if they are unsure whether they can afford the home purchase,' said OCBC's Mr Chan.
'Things are quite fluid these days so buyers should re-check their loan eligibility after one month,' said Mr Ng.
Posted by Anonymouse in the Singapore Property Forum
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
"Just read in today Straits Times "Surge in layoffs expected" and numbers likely to jump beyond the peak suffered during the 1998 Asian financial crisis. About 30,000 jobs were lost then... This spells doom for Singapore private property market, most people will go for HDB be it for newly weds or down grading, it's a safer choice."
"Singapore has yet to feel the full force of the ongoing crisis but there are already signs that it would be ugly and long—drawn. Apart from sharp dips in export figures, job cuts have already hit the manufacturing, finance and banking sectors. "
"With unemployment expected to rise, Singaporeans are bracing themselves for more bad news on the job front... Be prepared for the worst don't commit to those overpriced condo."
"Agreed .....save for a rainy day buying HDB is a safer choice. "
"Agree .. PM just said this recession is going to be a fat-U recession ... it's haunting"
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
PM Lee: Singapore in recession .. expect a U-shaped recovery with a fat U
Forum discussion extracted from the Singapore Property Forum:"Just read in today Straits Times "Surge in layoffs expected" and numbers likely to jump beyond the peak suffered during the 1998 Asian financial crisis. About 30,000 jobs were lost then... This spells doom for Singapore private property market, most people will go for HDB be it for newly weds or down grading, it's a safer choice."
"Singapore has yet to feel the full force of the ongoing crisis but there are already signs that it would be ugly and long—drawn. Apart from sharp dips in export figures, job cuts have already hit the manufacturing, finance and banking sectors. "
"With unemployment expected to rise, Singaporeans are bracing themselves for more bad news on the job front... Be prepared for the worst don't commit to those overpriced condo."
"Agreed .....save for a rainy day buying HDB is a safer choice. "
"Agree .. PM just said this recession is going to be a fat-U recession ... it's haunting"
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
October's fall compared with market expectations for marginal growth of 0.3 per cent, and followed a worse-than-expected revised 0.9 per cent drop in September.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Singapore Economic Outlook: Singapore October Exports Fell 7.4%, worse than expected
Singapore's non-oil exports fell an unexpected 7.4% in October from the previous month after seasonal adjustments, the latest evidence that the worsening financial crisis has reduced demand for Asian exports. Electronics shipments fell by 15% from a year ago while drugs exports fell unexpectedly, down 38.9% in the same periodOctober's fall compared with market expectations for marginal growth of 0.3 per cent, and followed a worse-than-expected revised 0.9 per cent drop in September.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Friday, November 14, 2008
About this Blog
The big property sale has begun. Prices have been slashed by half at Luma, a 75-unit freehold luxury condominium at River Valley Grove. Relaunching this weekend, units at Luma are being offered at $1,450 per square foot, down almost 50% from $2,800 psf when it was first launched last year. The relaunch of Luma at halved priced is believed to be the first among luxury condominiums.
SISV-Realink data shows two units on the 25th floor changed hands at $2,837 psf and $2,586 psf in April this year. These prices were already much lower than those for two units on the 20th and 26th floors, which went for $3,349 psf and $3,291 psf in August 2007. At that time when the property market was feverish, some people even speculated that prices could reach $4,000 psf.
Luma (which will be completed in 2011) has three units on each floor, ranging from 743 sq feet to 1,173 sq feet. The developer behind the project is the mid-sized Novelty Group. Luma sits on an en-bloc site at St Thomas Walk which Novelty bought in 2006 for $76.5 million, or about $810 psf of potential gross floor area. The Novelty Group also bought White House Park Apartments in Stevens Road for $22 million from Asia General Holdings. It also has developments in Pasir Panjang, Geylang, Yio Chu Kang and Pasir Ris.
Nicholas Mak, director of research and consultancy at Knight Frank, said more of the smaller developers could be relaunching at lower prices. 'The bigger ones are discreetly offering soft discounts, such as lifestyle vouchers,' he said. 'I think the chief aim is to move units, to increase sales. They've probably done their sums - they expect to do a level of sales to achieve breakeven point, which will lower their borrowings and feel more comfortable,' Mr Mak added.
Banks are probably repricing loans, and some developers especially the smaller ones that have revolving facilities or variable-rate loans may feel the pinch.
Comments on the above article extracted from the Singapore Property Forum:
"WOW! Cheap Sale!"
"If you look in terms of % drop is WOW but if you look in terms of returns, it's not so WOW .. URA data shows rental rate is about $4 psf for river valley area like Aspen Ht, Valley Park, .. even at halved price, rental yield works out to be only 2% lah.. for such a high risk?!"
"it just goes to show how over-valued spore property is"
"Luma today relaunch at half the price....Hahaha! What do you think the price of condo around that area now? it will be around $1400 in no time.....You think buyers stupid is it? Novelty is droping price becasue they have at least 6 other developments haven't sell or not selling well. Do you think he can hold all these units....through the crisis? That's why. You will see another developer doing the same in the next couple of days and next follow suit...... then, afterthat, owners will have no choice but to follow.....that is how the market will crash! Hahahaha! "
"Lol.. You sound really happy.. And how will that benefits you? Or did you had beer.."
"I am happy because I live in a hdb. I'm always an advocate of prudency. I think buying a condo is like buying a Ferrari. Will you burn your money like buying and depreciating a Ferrari? Singaporean have such a liking for condo that he don't mind burning away hard earn money into something that really make no sense compared to a hdb. If he is a businessman making lots of money.....I agree. But most of the S'porean who buy condo are wage earner. They don't know how to invest other than buying property. They will end up working for 3 persons in their whole life: Bank, govt and boss. Their life revolve around working, pay loan and working harder. In crisis time, they might not even keep their jobs. Even dbs is axing people. Rich man make the money FIRST, then spend. Poor man spend the money first, then try to make payment. Singaporean will wake up one day, just like how the American woke up 2 months ago."
"moron, this is marketng gimmick & a irresponsible small company selling.
They bought the land at $800 psf, development cost of $500 psf, they are still making money at $1500 psf.
This is just a blood-suc-ker company, should let them bankrupt.
What so good about River Valley area? walking distance no ammenity, no MRT, in/out of ERP, bad traffic, no good school, no big megamall, no sport hub....."
"but once upon a time during the boom, morons were even thinking about paying $4000 psf for it ... now both bulls and bears can see how over-valued property has become with all the speculation ... even at $1500psf your return is only at about 2% lah."
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
River Valley condo Luma relaunches with prices halved
Units going for $1,450 psf, down from $2,800 psf at launch last year
The big property sale has begun. Prices have been slashed by half at Luma, a 75-unit freehold luxury condominium at River Valley Grove. Relaunching this weekend, units at Luma are being offered at $1,450 per square foot, down almost 50% from $2,800 psf when it was first launched last year. The relaunch of Luma at halved priced is believed to be the first among luxury condominiums.
SISV-Realink data shows two units on the 25th floor changed hands at $2,837 psf and $2,586 psf in April this year. These prices were already much lower than those for two units on the 20th and 26th floors, which went for $3,349 psf and $3,291 psf in August 2007. At that time when the property market was feverish, some people even speculated that prices could reach $4,000 psf.
Luma (which will be completed in 2011) has three units on each floor, ranging from 743 sq feet to 1,173 sq feet. The developer behind the project is the mid-sized Novelty Group. Luma sits on an en-bloc site at St Thomas Walk which Novelty bought in 2006 for $76.5 million, or about $810 psf of potential gross floor area. The Novelty Group also bought White House Park Apartments in Stevens Road for $22 million from Asia General Holdings. It also has developments in Pasir Panjang, Geylang, Yio Chu Kang and Pasir Ris.
Nicholas Mak, director of research and consultancy at Knight Frank, said more of the smaller developers could be relaunching at lower prices. 'The bigger ones are discreetly offering soft discounts, such as lifestyle vouchers,' he said. 'I think the chief aim is to move units, to increase sales. They've probably done their sums - they expect to do a level of sales to achieve breakeven point, which will lower their borrowings and feel more comfortable,' Mr Mak added.
Banks are probably repricing loans, and some developers especially the smaller ones that have revolving facilities or variable-rate loans may feel the pinch.
Comments on the above article extracted from the Singapore Property Forum:
"WOW! Cheap Sale!"
"If you look in terms of % drop is WOW but if you look in terms of returns, it's not so WOW .. URA data shows rental rate is about $4 psf for river valley area like Aspen Ht, Valley Park, .. even at halved price, rental yield works out to be only 2% lah.. for such a high risk?!"
"it just goes to show how over-valued spore property is"
"Luma today relaunch at half the price....Hahaha! What do you think the price of condo around that area now? it will be around $1400 in no time.....You think buyers stupid is it? Novelty is droping price becasue they have at least 6 other developments haven't sell or not selling well. Do you think he can hold all these units....through the crisis? That's why. You will see another developer doing the same in the next couple of days and next follow suit...... then, afterthat, owners will have no choice but to follow.....that is how the market will crash! Hahahaha! "
"Lol.. You sound really happy.. And how will that benefits you? Or did you had beer.."
"I am happy because I live in a hdb. I'm always an advocate of prudency. I think buying a condo is like buying a Ferrari. Will you burn your money like buying and depreciating a Ferrari? Singaporean have such a liking for condo that he don't mind burning away hard earn money into something that really make no sense compared to a hdb. If he is a businessman making lots of money.....I agree. But most of the S'porean who buy condo are wage earner. They don't know how to invest other than buying property. They will end up working for 3 persons in their whole life: Bank, govt and boss. Their life revolve around working, pay loan and working harder. In crisis time, they might not even keep their jobs. Even dbs is axing people. Rich man make the money FIRST, then spend. Poor man spend the money first, then try to make payment. Singaporean will wake up one day, just like how the American woke up 2 months ago."
"moron, this is marketng gimmick & a irresponsible small company selling.
They bought the land at $800 psf, development cost of $500 psf, they are still making money at $1500 psf.
This is just a blood-suc-ker company, should let them bankrupt.
What so good about River Valley area? walking distance no ammenity, no MRT, in/out of ERP, bad traffic, no good school, no big megamall, no sport hub....."
"but once upon a time during the boom, morons were even thinking about paying $4000 psf for it ... now both bulls and bears can see how over-valued property has become with all the speculation ... even at $1500psf your return is only at about 2% lah."
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
And on 29 Oct in ST, the developer had said
'We're very confident that there'll be a strong demand for our flats, which are new and attractively priced compared to resale flats in Bishan.'
Well, lets see how many percent of applications actually convert finally into real sales. If there's one thing previous DBSS launches have taught us, do not count your chickens before they hatch.
Nov 13, 2008
Higher-end HDB mkt cooling? (I'd replace the "?" with a ".")
By Jessica Cheam
THE higher-end of the public housing market is showing its first signs of cooling, with the Housing Board's latest condo-style flats receiving a lacklustre response.
With only one day left to the closing of applications, Natura Loft at Bishan has drawn about 600 applications for 480 flats, its developer told The Straits Times yesterday. This is in stark contrast to the previous three projects built under HDB's design, build and sell scheme (DBSS), which attracted overwhelming demand.
The first project, Premiere @ Tampines, was a hit, with 6,000 applications for 616 homes; City View @ Boon Keng had 3,500 buyers vying for 714 flats while the third project, Park Central at Ang Mo Kio, drew 2,300 bids for 578 units.
Industry watchers say Natura Loft is a victim of the latest turn in market sentiment, which has seen companies retrenching staff and economies worldwide entering recession.
'Announcements such as DBS Bank laying off 900 jobs has caught everyone off-guard, and local sentiment has turned very bad,' said Mr Colin Tan, head of research and consultancy at Chesterton Suntec International.
Other analysts such as ERA Asia-Pacific's assistant vice-president Eugene Lim said Natura Loft's pricing was 'on the high side'. (Hmm, you don't say! Well, someone has to send the developers this message)
'The pricey units were launched at a time when the market is jittery, making a double whammy for the project,' he said.
Posted by Ann in the Singapore Property Forum
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Higher-end HDB market cooling: Natura Loft at Bishan sees far fewer applicants
I'm not surprised, are you?And on 29 Oct in ST, the developer had said
'We're very confident that there'll be a strong demand for our flats, which are new and attractively priced compared to resale flats in Bishan.'
Well, lets see how many percent of applications actually convert finally into real sales. If there's one thing previous DBSS launches have taught us, do not count your chickens before they hatch.
Nov 13, 2008
Higher-end HDB mkt cooling? (I'd replace the "?" with a ".")
By Jessica Cheam
THE higher-end of the public housing market is showing its first signs of cooling, with the Housing Board's latest condo-style flats receiving a lacklustre response.
With only one day left to the closing of applications, Natura Loft at Bishan has drawn about 600 applications for 480 flats, its developer told The Straits Times yesterday. This is in stark contrast to the previous three projects built under HDB's design, build and sell scheme (DBSS), which attracted overwhelming demand.
The first project, Premiere @ Tampines, was a hit, with 6,000 applications for 616 homes; City View @ Boon Keng had 3,500 buyers vying for 714 flats while the third project, Park Central at Ang Mo Kio, drew 2,300 bids for 578 units.
Industry watchers say Natura Loft is a victim of the latest turn in market sentiment, which has seen companies retrenching staff and economies worldwide entering recession.
'Announcements such as DBS Bank laying off 900 jobs has caught everyone off-guard, and local sentiment has turned very bad,' said Mr Colin Tan, head of research and consultancy at Chesterton Suntec International.
Other analysts such as ERA Asia-Pacific's assistant vice-president Eugene Lim said Natura Loft's pricing was 'on the high side'. (Hmm, you don't say! Well, someone has to send the developers this message)
'The pricey units were launched at a time when the market is jittery, making a double whammy for the project,' he said.
Posted by Ann in the Singapore Property Forum
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
The developer held a sneak preview to test the market a fortnight ago and then a soft launch last weekend, when it sold half of the 60 units launched.‘We tested the market…and we were pleasantly surprised that the response was good, so we are going ahead with the launch,’ said Mr Lim Yew Soon, managing director of EL Development, a unit of local builder Evan Lim & Co.‘If we had waited till next year, there would be a lot of competition. It’s better to have a first-mover advantage.’
‘Our earlier price expectations were higher. We benchmarked current prices against the prices of older condos in the area,’ said Mr Lim. Those who bought at the soft launch received a 2% discount from these price levels, he said. Mr Lim said the buyers were mostly dwellers of nearby flats and condominiums.
There are two other condominiums in Rosewood Drive - Casablanca and Rosewood. At Casablanca, two caveats lodged in September and October showed that two 1,184sqft units were sold at $541psf and $549psf, or $640,000 and $650,000. Caveats lodged in the same months at the 437-unit Rosewood showed that two 1,173sqft units were sold for $537psf to $550psf, or at $630,000 and $645,000.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
200-unit Rosewood Suites to launch at $580 psf
EL Development is launching the 99-year leasehold Rosewood Suites at an average price of $580 psf this weekend. Rosewood Suites is a five-storey development with 1-4bedroom apartments. Prices start from $435,000 for a two-bedroom unit and go up to $1.1 million for a four-bedroom ground-floor unit.The developer held a sneak preview to test the market a fortnight ago and then a soft launch last weekend, when it sold half of the 60 units launched.‘We tested the market…and we were pleasantly surprised that the response was good, so we are going ahead with the launch,’ said Mr Lim Yew Soon, managing director of EL Development, a unit of local builder Evan Lim & Co.‘If we had waited till next year, there would be a lot of competition. It’s better to have a first-mover advantage.’
‘Our earlier price expectations were higher. We benchmarked current prices against the prices of older condos in the area,’ said Mr Lim. Those who bought at the soft launch received a 2% discount from these price levels, he said. Mr Lim said the buyers were mostly dwellers of nearby flats and condominiums.
There are two other condominiums in Rosewood Drive - Casablanca and Rosewood. At Casablanca, two caveats lodged in September and October showed that two 1,184sqft units were sold at $541psf and $549psf, or $640,000 and $650,000. Caveats lodged in the same months at the 437-unit Rosewood showed that two 1,173sqft units were sold for $537psf to $550psf, or at $630,000 and $645,000.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
In February this year, HDB also launched Punggol Spring, which is twice the distance away from the MRT/LRT station. Launch prices of Punggol Spring were about 20 per cent lower in comparison to Punggol Arcadia.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
HDB BTO Punggol Arcadia Priced Higher than Punggol Sapphire
The Housing and Development Board (HDB) has launched the 750-unit Punggol Arcadia with five-room flats going for as much as $356,000 to $416,000. This represents an increase of between 7-8% compared to the nearby Punggol Sapphire which HDB launched six months ago. Punggol Arcadia and Punggol Sapphire are both are about the same distance to the Punggol MRT/LRT station.In February this year, HDB also launched Punggol Spring, which is twice the distance away from the MRT/LRT station. Launch prices of Punggol Spring were about 20 per cent lower in comparison to Punggol Arcadia.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Monday, November 10, 2008
About this Blog
"Here are the good words of our own MM Lee whom some Bears had reminded us that property will go down in cyclical..seems like MM Lee is very optimistic of Singapore property market. And the fact that the government is controlling supply and ensuring stability, a crash is extremely unlikely. So who to believe now? The bears or MM Lee? Hahaha ... Minister Mentor Lee said property values are bound to go up in the long run because the government is continuously building more infrastructure and attracting higher-value investments that provide higher wages to employees. "
"well said, MM. The surge time will come, swift & just happen overnight.
Global rate cut is good for property, globally is trying to flood US$10 Trillion... Spore govt also will come out with a stimulus budget to drive Spore economy. Once engine starts, you will see buyers coming back."
"the mean property price of a country with sound economy will rise in tandem with its economic growth is pretty much common sense .. MM Lee said property price will rise in the long run .. he didn't say it'll surge from where it is now, in fact he implies that it'll crash in the short term .. and he's trying reassure ppl that after the crash, it'll again rise in the long run. "
"MM Lee mentioned of our reserve to see us through this crisis is chilling. He has said NO to touching the reserve in past recessions...global rate cut is not going to save spore overvalued-property price because banks are tight with their lendings because of a credibility crisis, not just a credit crisis .. China stimulus is to boost its domestic economy ... if it can save itself is already very good .. don't depend on china to save our economy, much less our property...Spore stimulus package is likely for public spendings on long-term infrastructure as we have seen in the past .. and as tharman mentioned, to help business's cash flow .. we've never seen a recession this bad that cash flow of business is severely impaired that it needs to be in our budget .. it's frightening .. the more the govt is doing way more than past recessions, the more it signals the severity of this recession. BEWARE!"
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
MM Lee: Property Price will continue to rise in the long term
In response to the news reportby CNA 9 Nov 2008, "MM Lee believes property values will continue to rise in long term"; forumers in the Singapore Property Forum wrote:"Here are the good words of our own MM Lee whom some Bears had reminded us that property will go down in cyclical..seems like MM Lee is very optimistic of Singapore property market. And the fact that the government is controlling supply and ensuring stability, a crash is extremely unlikely. So who to believe now? The bears or MM Lee? Hahaha ... Minister Mentor Lee said property values are bound to go up in the long run because the government is continuously building more infrastructure and attracting higher-value investments that provide higher wages to employees. "
"well said, MM. The surge time will come, swift & just happen overnight.
Global rate cut is good for property, globally is trying to flood US$10 Trillion... Spore govt also will come out with a stimulus budget to drive Spore economy. Once engine starts, you will see buyers coming back."
"the mean property price of a country with sound economy will rise in tandem with its economic growth is pretty much common sense .. MM Lee said property price will rise in the long run .. he didn't say it'll surge from where it is now, in fact he implies that it'll crash in the short term .. and he's trying reassure ppl that after the crash, it'll again rise in the long run. "
"MM Lee mentioned of our reserve to see us through this crisis is chilling. He has said NO to touching the reserve in past recessions...global rate cut is not going to save spore overvalued-property price because banks are tight with their lendings because of a credibility crisis, not just a credit crisis .. China stimulus is to boost its domestic economy ... if it can save itself is already very good .. don't depend on china to save our economy, much less our property...Spore stimulus package is likely for public spendings on long-term infrastructure as we have seen in the past .. and as tharman mentioned, to help business's cash flow .. we've never seen a recession this bad that cash flow of business is severely impaired that it needs to be in our budget .. it's frightening .. the more the govt is doing way more than past recessions, the more it signals the severity of this recession. BEWARE!"
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Thursday, November 6, 2008
About this Blog
(SINGAPORE) When Ministry of National Development announced last week that it was suspending sales of state land through the confirmed list till June next year, jubilant developers lauded the swiftness of the government action that will hopefully stem the poor sentiment in the property market.
Some developers were also hopeful that the government will reintroduce the Deferred Payment Scheme (DPS), which was scrapped in October last year to deter speculation.
Under DPS, home buyers had to pay only 10 per cent, or more typically 20 per cent, of the price of the residential property they bought from developers.
The next payment would be made when the project was completed, perhaps two to three years down the road. Very often, buyers could make the 10-20 per cent initial downpayment using cash and CPF savings, without having to commit to a bank loan, which could be delayed till the project was closer to completion, when the bulk of the purchase price had to be paid to the developer.
Under a normal progress payment scheme, buyers have to secure a housing loan much sooner, as they are billed by the developer in stages, according to the progress of the project's construction.
When DPS was scrapped in October 2007, many industry watchers said it had come too late as sentiment in the Singapore property market had already started to soften with the onset of the US sub-prime crisis.
And now, most property agents agree that restoring the scheme will help bring some buyers back into the market, especially foreign buyers - although not in as great a number as during the height of property fever in early 2007.
The head of a big property consulting group estimated that in some instances, up to 70 per cent of foreign buyers in luxury residential projects bought on deferred payment schemes in 2006-2007.
Buyers have to pay up to 5 per cent more under the DPS compared with the normal progress payment scheme. Yet the ease of making a small initial downpayment made buying attractive for speculators eyeing huge gains from disposing of their properties before the projects were completed.
However, other market watchers and analysts say a restoration of DPS could potentially create Singapore's own version of a sub-prime crisis.
When home buyers purchase a property on DPS, without committing to any bank loan, there is no credit assessment done to see if they have the means to complete the purchase. So this scheme could draw less credit-worthy buyers who may have difficulty securing housing loans later when it is time to pay up.
If substantial numbers of buyers default and return their units to the developer, the banks that had extended loans to the developers may not be too happy.
'The land loan and construction loan may be required to be priced differently because the risk has increased,' as Savills Singapore's director of marketing and business development Ku Swee Yong puts it.
Agreeing, the head of the major property consulting group said: 'There will be implications for banks' exposure to property loans extended to developers, and that was probably a major reason the authorities considered in scrapping DPS in the first instance.'
To be sure, DPS is helpful to genuine home buyers. For instance, an HDB upgrader who buys a private home under construction would prefer to sell his existing HDB flat only when the private condo he's moving into has been completed; so DPS helps him to tide over until then, says Mr Ku.
But market watchers point out that DPS - because it does not entail credit checks - also has a tendency to draw speculators. 'There's a penchant for optimism, especially among the young. Whereas if you take a housing loan, you will be psychologically more aware of your financial obligations and tend to be more careful,' says a property veteran.
To cut this risk of fuelling speculation, the DPS could be reincarnated but with modifications, suggests Savills' Mr Ku. For one, home buyers making a purchase under the DPS could be required to sign up for a housing loan first, even if they need to make a drawdown only a few years later. 'That way, the credit assessment is done upfront. And secondly, such home buyers will have to pay a penalty to the bank in the form of an admin charge of $3,000 to $6,000 if they decide to sell their property before the project is completed and not use the home loan or if they make an early repayment,' Mr Ku says.
Another way to reduce the negative effects of DPS is to raise the initial payment from 10-20 per cent previously to 30 per cent, Mr Ku suggests. 'That way, the developer would have collected more equity and that will provide a bigger cushion to protect the developer as well as its banks in the event of a default by buyers not able to hold on to their units,' he adds.
Then there's another view. The government should continue to keep DPS at bay and instead leave banks to offer innovative housing loans to home buyers that replicate the benefits of DPS - if it makes commercial sense to them. The interest absorption and zero instalment schemes offered by some banks highlighted in a BT article in September allow buyers to make a 20 per cent downpayment and then nothing until the project is completed.
Under such schemes, buyers have to sign up for a bank loan for the property, thus entailing a credit-worthiness check to ensure they are not dabbling in properties beyond their means. Afterall, nobody wants a sub-prime crisis here.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
DPS can create Singapore sub-prime crisis, analysts caution
Some developers hopeful that the government will reintroduce DPS
(SINGAPORE) When Ministry of National Development announced last week that it was suspending sales of state land through the confirmed list till June next year, jubilant developers lauded the swiftness of the government action that will hopefully stem the poor sentiment in the property market.
Some developers were also hopeful that the government will reintroduce the Deferred Payment Scheme (DPS), which was scrapped in October last year to deter speculation.
Under DPS, home buyers had to pay only 10 per cent, or more typically 20 per cent, of the price of the residential property they bought from developers.
The next payment would be made when the project was completed, perhaps two to three years down the road. Very often, buyers could make the 10-20 per cent initial downpayment using cash and CPF savings, without having to commit to a bank loan, which could be delayed till the project was closer to completion, when the bulk of the purchase price had to be paid to the developer.
Under a normal progress payment scheme, buyers have to secure a housing loan much sooner, as they are billed by the developer in stages, according to the progress of the project's construction.
When DPS was scrapped in October 2007, many industry watchers said it had come too late as sentiment in the Singapore property market had already started to soften with the onset of the US sub-prime crisis.
Property Agents said Restoring DPS will bring back Foreign Buyers
And now, most property agents agree that restoring the scheme will help bring some buyers back into the market, especially foreign buyers - although not in as great a number as during the height of property fever in early 2007.
The head of a big property consulting group estimated that in some instances, up to 70 per cent of foreign buyers in luxury residential projects bought on deferred payment schemes in 2006-2007.
Buyers have to pay up to 5 per cent more under the DPS compared with the normal progress payment scheme. Yet the ease of making a small initial downpayment made buying attractive for speculators eyeing huge gains from disposing of their properties before the projects were completed.
DPS Restoration may create Singapore's Sub-prime crisis
However, other market watchers and analysts say a restoration of DPS could potentially create Singapore's own version of a sub-prime crisis.
When home buyers purchase a property on DPS, without committing to any bank loan, there is no credit assessment done to see if they have the means to complete the purchase. So this scheme could draw less credit-worthy buyers who may have difficulty securing housing loans later when it is time to pay up.
If substantial numbers of buyers default and return their units to the developer, the banks that had extended loans to the developers may not be too happy.
'The land loan and construction loan may be required to be priced differently because the risk has increased,' as Savills Singapore's director of marketing and business development Ku Swee Yong puts it.
Agreeing, the head of the major property consulting group said: 'There will be implications for banks' exposure to property loans extended to developers, and that was probably a major reason the authorities considered in scrapping DPS in the first instance.'
Ku Swee Young: DPS is helpful to genuine home buyers
To be sure, DPS is helpful to genuine home buyers. For instance, an HDB upgrader who buys a private home under construction would prefer to sell his existing HDB flat only when the private condo he's moving into has been completed; so DPS helps him to tide over until then, says Mr Ku.
DPS has a tendency to draw speculators
But market watchers point out that DPS - because it does not entail credit checks - also has a tendency to draw speculators. 'There's a penchant for optimism, especially among the young. Whereas if you take a housing loan, you will be psychologically more aware of your financial obligations and tend to be more careful,' says a property veteran.
Ku Swee Yong: DPS could be reincarnated but with modifications
To cut this risk of fuelling speculation, the DPS could be reincarnated but with modifications, suggests Savills' Mr Ku. For one, home buyers making a purchase under the DPS could be required to sign up for a housing loan first, even if they need to make a drawdown only a few years later. 'That way, the credit assessment is done upfront. And secondly, such home buyers will have to pay a penalty to the bank in the form of an admin charge of $3,000 to $6,000 if they decide to sell their property before the project is completed and not use the home loan or if they make an early repayment,' Mr Ku says.
Another way to reduce the negative effects of DPS is to raise the initial payment from 10-20 per cent previously to 30 per cent, Mr Ku suggests. 'That way, the developer would have collected more equity and that will provide a bigger cushion to protect the developer as well as its banks in the event of a default by buyers not able to hold on to their units,' he adds.
Another view: Leave banks to offer innovative housing loans to home buyers
Then there's another view. The government should continue to keep DPS at bay and instead leave banks to offer innovative housing loans to home buyers that replicate the benefits of DPS - if it makes commercial sense to them. The interest absorption and zero instalment schemes offered by some banks highlighted in a BT article in September allow buyers to make a 20 per cent downpayment and then nothing until the project is completed.
Under such schemes, buyers have to sign up for a bank loan for the property, thus entailing a credit-worthiness check to ensure they are not dabbling in properties beyond their means. Afterall, nobody wants a sub-prime crisis here.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
"我 已 經 說 過 ， 那 股已 經 上 岸 的 心 態 使 到 自 己 已 無 當年 之 勇 ， 更 何 況 金 融 海 嘯 的 確 是 生 平 所 未 見 ， 多 年來 幸 運 地 賺 到 一 些 錢 ， 目 前 想 買樓 的 念 頭 可 能 強 過 買 股 票 ， 仍 打 不 定 主 意 。 樓 價 只要 特 區 政 府 堅 守 「 勾 地 」 政 策 ，土 地 供 應 有 限 ， 價 格 不 可 能 大 跌 。
買樓 與 買 股 最 大 的 分 別 是 ： 股 價 波 幅 太 大 ， 影 響 心 理 健 康 ， 樓 價 只 要 能 夠 做 到 毋 須樓按 ， 則 不 會 有 甚 麼 壓 力 。 買 樓 收 租 是 我 將 來 的 退 休 大 計 ， 兩 千 年 來 ， 中 國 的 地 方鄉紳 就 是 靠 買 地 收 租 當 地 主 而 一 代 傳 一 代 ， 這 是 最 簡 單 的 保 護 財 富 方 法 。"
"He is right.
As long as Govt stop selling land, cut out the supply in near future, property price wil be sustainable.
Demand will still be there, new family, marriage, FT, immigrants, 6.5M population, Sporean back from US & Europe......
Market just waiting for signal to up again."
"govt also stop land sales during the 97-Asian financial crisis but private property price plunged neverthelessly by 40%-50% by developers and in some cases, 70% by sellers ... when the govt acts, it's usually because they already see the crash!!!
in fact, in the 97-crisis, the overhanging supply is only half of what we see today .. it took more than 10 years for property price to recover .."
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Impact of Singapore Government's Land Sales Halt
The Singapore government recent announcement to halt land sales in view of the plunging sales of private property market bring to mind the same measure that was carried out during the 97-Asian Financial Crisis. The following is a forum-exchange on the impact of the measure extracted from the Singapore Property Forum:"我 已 經 說 過 ， 那 股已 經 上 岸 的 心 態 使 到 自 己 已 無 當年 之 勇 ， 更 何 況 金 融 海 嘯 的 確 是 生 平 所 未 見 ， 多 年來 幸 運 地 賺 到 一 些 錢 ， 目 前 想 買樓 的 念 頭 可 能 強 過 買 股 票 ， 仍 打 不 定 主 意 。 樓 價 只要 特 區 政 府 堅 守 「 勾 地 」 政 策 ，土 地 供 應 有 限 ， 價 格 不 可 能 大 跌 。
買樓 與 買 股 最 大 的 分 別 是 ： 股 價 波 幅 太 大 ， 影 響 心 理 健 康 ， 樓 價 只 要 能 夠 做 到 毋 須樓按 ， 則 不 會 有 甚 麼 壓 力 。 買 樓 收 租 是 我 將 來 的 退 休 大 計 ， 兩 千 年 來 ， 中 國 的 地 方鄉紳 就 是 靠 買 地 收 租 當 地 主 而 一 代 傳 一 代 ， 這 是 最 簡 單 的 保 護 財 富 方 法 。"
"He is right.
As long as Govt stop selling land, cut out the supply in near future, property price wil be sustainable.
Demand will still be there, new family, marriage, FT, immigrants, 6.5M population, Sporean back from US & Europe......
Market just waiting for signal to up again."
"govt also stop land sales during the 97-Asian financial crisis but private property price plunged neverthelessly by 40%-50% by developers and in some cases, 70% by sellers ... when the govt acts, it's usually because they already see the crash!!!
in fact, in the 97-crisis, the overhanging supply is only half of what we see today .. it took more than 10 years for property price to recover .."
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
1. Singapore is an open economy that is export driven. We are in a technical recession and heading towards a "real" recession. Jobs will be lost and people displaced. It is not wise to buy private property when your rice bowl is uncertain.
2. Banks have necessarily tightened credit conditions. Buyers may not be able to get the amount of loan that they want. Instead of 80%, they may only get 60-70%. Cash/CPF upfront payments will get bigger and current prices therefore will have to fall to a sustainable level.
3. The global financial crisis is unprecedented. We still do not know the full effects of the bailouts yet. The current euphoria regarding the US election will eventually wear off and reality will set in when callus hands meets the yoke.
4. The TOPs are only just starting. The flippers with no holding power are only just starting to sell. Many are still holding out for "Hai Gong's". Let them wait for several months more until they are really desperate before you do a massive price slash.
5. The hype about the Olympics, IR, YOG and Foreign Talent has officially died. All the potential upsides have been more than priced in.
6. Young couples, even the middle to higher income have shifted to HDBs because condo prices have gone beyond their reach. There are fewer and fewer real buyers to sustain prices.
7. Condos are luxury items. Real owner buyers want to live a "good" and comfortable life in their condos. However, newer condos may even be inferior to HDB in terms of comfort. Some of them don't have enough carpark lots for residents. Some are so small and cramped as to be little more than a pidgeon hole. Some are located in places that are inconvenient without nearby food places, amenities. I think property developers may have got it wrong in this respect. People want to upgrade to Private from HDB by and large because they want a more comfortable lifestyle. Living in an expensive and tiny pidgeonhole where your car has no lot to park in, where your bedroom is so tiny that you can't have bedroom cabinet doors that swing out... instead, they have to be sliding, where facilities are overcrowded, maintenance fees are high, etc. etc. is more torture than an upgrade of lifestyle. Therefore, some developments are just not worth the money...
8. There is a glut coming from the projects whose launch dates can't be pushed back further.
Posted by Anonymous in the Singapore Property Forum
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Private Property Buyers' Tip: Points to consider before buying
Let me state based on my own understanding why I think prices have not bottomed out and it is worth it to wait a little longer at this current time.Singapore Economy heading towards "real" recession
1. Singapore is an open economy that is export driven. We are in a technical recession and heading towards a "real" recession. Jobs will be lost and people displaced. It is not wise to buy private property when your rice bowl is uncertain.
Credit Crunch
2. Banks have necessarily tightened credit conditions. Buyers may not be able to get the amount of loan that they want. Instead of 80%, they may only get 60-70%. Cash/CPF upfront payments will get bigger and current prices therefore will have to fall to a sustainable level.
Global Crisis Still Cloudy
3. The global financial crisis is unprecedented. We still do not know the full effects of the bailouts yet. The current euphoria regarding the US election will eventually wear off and reality will set in when callus hands meets the yoke.
Marginal Property Flippers yet to emerge in full force
4. The TOPs are only just starting. The flippers with no holding power are only just starting to sell. Many are still holding out for "Hai Gong's". Let them wait for several months more until they are really desperate before you do a massive price slash.
Hypes Surrounding Real Estate Boom have faded
5. The hype about the Olympics, IR, YOG and Foreign Talent has officially died. All the potential upsides have been more than priced in.
Home buyers' Downgrading may cause private property price to be unsustainable
6. Young couples, even the middle to higher income have shifted to HDBs because condo prices have gone beyond their reach. There are fewer and fewer real buyers to sustain prices.
Condos are not really value for money
7. Condos are luxury items. Real owner buyers want to live a "good" and comfortable life in their condos. However, newer condos may even be inferior to HDB in terms of comfort. Some of them don't have enough carpark lots for residents. Some are so small and cramped as to be little more than a pidgeon hole. Some are located in places that are inconvenient without nearby food places, amenities. I think property developers may have got it wrong in this respect. People want to upgrade to Private from HDB by and large because they want a more comfortable lifestyle. Living in an expensive and tiny pidgeonhole where your car has no lot to park in, where your bedroom is so tiny that you can't have bedroom cabinet doors that swing out... instead, they have to be sliding, where facilities are overcrowded, maintenance fees are high, etc. etc. is more torture than an upgrade of lifestyle. Therefore, some developments are just not worth the money...
Impending Supply Glut
8. There is a glut coming from the projects whose launch dates can't be pushed back further.
Posted by Anonymous in the Singapore Property Forum
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
"Condos are luxury items. Real owner buyers want to live a "good" and comfortable life in their condos. However, newer condos may even be inferior to HDB in terms of comfort. Some of them don't have enough carpark lots for residents. Some are so small and cramped as to be little more than a pidgeon hole. Some are located in places that are inconvenient without nearby food places, amenities. I think property developers may have got it wrong in this respect. People want to upgrade to Private from HDB by and large because they want a more comfortable lifestyle. Living in an expensive and tiny pidgeonhole where your car has no lot to park in, where your bedroom is so tiny that you can't have bedroom cabinet doors that swing out... instead, they have to be sliding, where facilities are overcrowded, maintenance fees are high, etc. etc. is more torture than an upgrade of lifestyle. Therefore, some developments are just not worth the money..."
"Must say I really agree with you this. Although they're marketed as 'luxury' (and priced as such), many new condos are in more ways a regression. Rooms are now so small they don't even dare to put a bed in the showflat for fear you'd realise just how cramped the rooms are. Huge bay windows in every room consume what little precious space is left. Downstairs, there are no open areas to walk on, or for kids to play. The little space between blocks is used for the pools. The plots are built right up to the edge so that your window opens straight into the window/wall of the adjacent property. Clubhouse is more of a 'room', and 'gym' can barely take more than 4-5 people at once. These make new condos bad deals compared with older developments. I actually know a family who own both a condo and HDB, but decided to 'downgrade' back to the HDB after the novelty of condo living wore off, and they realised they actually got a BETTER quality of life staying in their huge HDB flat."
"I really agree with the point. The quality of life of modern S'porean living in new crampy condo is really bad. They work their shit out of their busy day and the only thing to do is just to pay off their loan for the condo and car. As though the whole world and whole life is to live in a crampy, lousy condo. How sad. They have no life! "
"Yes and your HDB units door is just 2 metres away from your neighbor, and the rubbish chute is just downstairs with the huge foul smell every afternoon when the garbage collectors came....And every Chap Goh Mei, you will see thrashes and thrashes of paper being burnt with no containers without due consideration for neighbors upstairs.... and the lift has lots of saliva, kids urine and its bloody cramp and smelly...plus the fact that the void deck is full of scum. And your neighbors will be foreign workers from India and China who will make noise every hour and hang their clothes right in front of your door....Hahahah which one is better living now? HDB or condo....what a fool !! "
"beside points above, many single lady drive back late at night dare not walk from car park to home, security is an issue, compared to walk fence up in condo with guards. O$P$ is so common inside lift, walls near lift in every floor, re-paint again & again.
No facility, it's convenient if you exercise regularly, track-mill, swimming, common air-con study room. Nicer surrounding, walking path, nice tiles in corridor, higher ceiling, better environment....
It's just totally different living comfort & condition, don't talk about status.
HDB is good, but just can't compare."
"I've spent equal amount of my adulthood living in HDB flats and condos. Strictly as a consumption good, condos do offer a more interesting lifestyle and better security than HDB. Of course, you've to pay maintenance and sinking funds for all those facilities in private condos, whereas HDB landscaping and regular painting come free. Also, because of the government's HDB upgrading, common areas in HDB with their covered walkway and tiled pavements are a lot more appealing than private estate. Most of all, if living in a condo means you've to work all your guts out to pay for it, then you'd be better off living in a HDB flat than be burdened with all those financial worries. Finally, if you're looking at investment returns, then no doubt HDB is better than condos esp 99LH condos."
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
HDB Flat vs Private Condo: Which is better value?
A forum exchange extracted from the Singapore Property Forum:"Condos are luxury items. Real owner buyers want to live a "good" and comfortable life in their condos. However, newer condos may even be inferior to HDB in terms of comfort. Some of them don't have enough carpark lots for residents. Some are so small and cramped as to be little more than a pidgeon hole. Some are located in places that are inconvenient without nearby food places, amenities. I think property developers may have got it wrong in this respect. People want to upgrade to Private from HDB by and large because they want a more comfortable lifestyle. Living in an expensive and tiny pidgeonhole where your car has no lot to park in, where your bedroom is so tiny that you can't have bedroom cabinet doors that swing out... instead, they have to be sliding, where facilities are overcrowded, maintenance fees are high, etc. etc. is more torture than an upgrade of lifestyle. Therefore, some developments are just not worth the money..."
"Must say I really agree with you this. Although they're marketed as 'luxury' (and priced as such), many new condos are in more ways a regression. Rooms are now so small they don't even dare to put a bed in the showflat for fear you'd realise just how cramped the rooms are. Huge bay windows in every room consume what little precious space is left. Downstairs, there are no open areas to walk on, or for kids to play. The little space between blocks is used for the pools. The plots are built right up to the edge so that your window opens straight into the window/wall of the adjacent property. Clubhouse is more of a 'room', and 'gym' can barely take more than 4-5 people at once. These make new condos bad deals compared with older developments. I actually know a family who own both a condo and HDB, but decided to 'downgrade' back to the HDB after the novelty of condo living wore off, and they realised they actually got a BETTER quality of life staying in their huge HDB flat."
"I really agree with the point. The quality of life of modern S'porean living in new crampy condo is really bad. They work their shit out of their busy day and the only thing to do is just to pay off their loan for the condo and car. As though the whole world and whole life is to live in a crampy, lousy condo. How sad. They have no life! "
"Yes and your HDB units door is just 2 metres away from your neighbor, and the rubbish chute is just downstairs with the huge foul smell every afternoon when the garbage collectors came....And every Chap Goh Mei, you will see thrashes and thrashes of paper being burnt with no containers without due consideration for neighbors upstairs.... and the lift has lots of saliva, kids urine and its bloody cramp and smelly...plus the fact that the void deck is full of scum. And your neighbors will be foreign workers from India and China who will make noise every hour and hang their clothes right in front of your door....Hahahah which one is better living now? HDB or condo....what a fool !! "
"beside points above, many single lady drive back late at night dare not walk from car park to home, security is an issue, compared to walk fence up in condo with guards. O$P$ is so common inside lift, walls near lift in every floor, re-paint again & again.
No facility, it's convenient if you exercise regularly, track-mill, swimming, common air-con study room. Nicer surrounding, walking path, nice tiles in corridor, higher ceiling, better environment....
It's just totally different living comfort & condition, don't talk about status.
HDB is good, but just can't compare."
"I've spent equal amount of my adulthood living in HDB flats and condos. Strictly as a consumption good, condos do offer a more interesting lifestyle and better security than HDB. Of course, you've to pay maintenance and sinking funds for all those facilities in private condos, whereas HDB landscaping and regular painting come free. Also, because of the government's HDB upgrading, common areas in HDB with their covered walkway and tiled pavements are a lot more appealing than private estate. Most of all, if living in a condo means you've to work all your guts out to pay for it, then you'd be better off living in a HDB flat than be burdened with all those financial worries. Finally, if you're looking at investment returns, then no doubt HDB is better than condos esp 99LH condos."
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Monday, November 3, 2008
About this Blog
HDB rental market will be the next segment of the local property market to be hit by the global financial crisis, reported Straits Times today. This may very well mark the beginning of the weakening in the HDB market.
Rents of Housing Board flats, which have been climbing steadily, largely on demand from foreigners squeezed out of the private homes market, are up only slightly in the third quarter even as rents of private homes fell. But property experts say HDB rents have likely peaked. They will hold steady for the next several months before they begin to crack from the pressure of falling rents in the private homes market.
'Any decline in private rents is going to contribute to the downward slide in HDB rents, but it may take a few months for the impact to filter down,' said Knight Frank's director of research and consultancy Nicholas Mak.
Downward Pressure on HDB Rents Already Showing
The pressure is already starting to show: Rents for HDB flats have shown smaller increases in the third quarter. Median rents for five-room flats have risen by $100 every quarter this year to $2,000 in the third. But median rents for three-room flats remained unchanged at $1,500 in the three-month period to Sept 30 while median rents for four-room flats showed a smaller $50 rise to $1,800, from $1,750 in the second quarter and $1,600 in the first.
May also want to read:
Singapore Property Forecast: HDB and Private Property will trend in opposite direction until ..,
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
HDB Rents to Fall as Private Property Rents fall
Downward slide in HDB rents may take a few monthsHDB rental market will be the next segment of the local property market to be hit by the global financial crisis, reported Straits Times today. This may very well mark the beginning of the weakening in the HDB market.
Rents of Housing Board flats, which have been climbing steadily, largely on demand from foreigners squeezed out of the private homes market, are up only slightly in the third quarter even as rents of private homes fell. But property experts say HDB rents have likely peaked. They will hold steady for the next several months before they begin to crack from the pressure of falling rents in the private homes market.
'Any decline in private rents is going to contribute to the downward slide in HDB rents, but it may take a few months for the impact to filter down,' said Knight Frank's director of research and consultancy Nicholas Mak.
Downward Pressure on HDB Rents Already Showing
The pressure is already starting to show: Rents for HDB flats have shown smaller increases in the third quarter. Median rents for five-room flats have risen by $100 every quarter this year to $2,000 in the third. But median rents for three-room flats remained unchanged at $1,500 in the three-month period to Sept 30 while median rents for four-room flats showed a smaller $50 rise to $1,800, from $1,750 in the second quarter and $1,600 in the first.
May also want to read:
Singapore Property Forecast: HDB and Private Property will trend in opposite direction until ..,
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
About this Blog
Nov 3, 2008
Global downturn quickens
LONDON - PROFITS evaporated at top European banks on Monday and authorities worldwide pressed on with efforts to bolster weakening economies as data from Europe and China suggested a sharp global downturn was gathering pace.
Nov 3, 2008
Slowdown hits Australia
CANBERRA (Australia) - AUSTRALIAN house prices rose at their slowest pace in almost three years, September retail sales slid, and job advertisements fell for a sixth consecutive month in new evidence on Monday that the economy is slowing.
House prices in state capitals fell by 1.8 per cent on average in the three months to September for an annual growth rate of just 2.8 per cent, the latest Australian Bureau of Statistic's house price index shows.
Nov 3, 2008
China's export orders fall
BEIJING - CHINA'S manufacturing activity slowed sharply in October amid weaker export demand despite a flurry of official measures to boost flagging growth in the world's fourth-largest economy, an industry group reported on Monday.
Nov 3, 2008
HK retail sales slow to 6.9%
HONG KONG - HONG KONG retail sales growth slowed to 6.9 per cent year-on-year in September as weak consumer spending linked to the world economic crisis began to bite, the government said on Monday.
Nov 3, 2008
Eurozone in recession?
BRUSSELS - THE 15 countries using the euro have slumped into a shallow recession in the face of the worst financial crisis in generations, the European Commission estimated on Monday.
Nov 3, 2008
S.Korea unveils stimulus
SOUTH Korea unveiled an economic stimulus plan on Monday and markets geared for more interest rate cuts in Europe and Australia in a frantic campaign to keep the financial crisis from plunging the world into its worst recession in decades.
Nov 3, 2008
Vietnam to cut prime rate
HANOI - VIETNAM'S central bank said it would cut the benchmark interest rate by one percentage point to 12 per cent on Wednesday in a bid to free up credit for businesses amid the global financial turmoil.
Nov 3, 2008
Indon inflation rises 11.77%
JAKARTA - INDONESIA'S inflation rate eased to 11.77 per cent year on year in October, the Central Statistics Agency said on Monday.
Nov 3, 2008
Consumer debt goes up
It indicates more people are unable to meet payments as crisis worsens
Posted by Anonymous in the Singapore Property Forum
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Global Economic Crisis Worsens by the day
Just some of today's Straits Times reports... see a trend?Nov 3, 2008
Global downturn quickens
LONDON - PROFITS evaporated at top European banks on Monday and authorities worldwide pressed on with efforts to bolster weakening economies as data from Europe and China suggested a sharp global downturn was gathering pace.
Nov 3, 2008
Slowdown hits Australia
CANBERRA (Australia) - AUSTRALIAN house prices rose at their slowest pace in almost three years, September retail sales slid, and job advertisements fell for a sixth consecutive month in new evidence on Monday that the economy is slowing.
House prices in state capitals fell by 1.8 per cent on average in the three months to September for an annual growth rate of just 2.8 per cent, the latest Australian Bureau of Statistic's house price index shows.
Nov 3, 2008
China's export orders fall
BEIJING - CHINA'S manufacturing activity slowed sharply in October amid weaker export demand despite a flurry of official measures to boost flagging growth in the world's fourth-largest economy, an industry group reported on Monday.
Nov 3, 2008
HK retail sales slow to 6.9%
HONG KONG - HONG KONG retail sales growth slowed to 6.9 per cent year-on-year in September as weak consumer spending linked to the world economic crisis began to bite, the government said on Monday.
Nov 3, 2008
Eurozone in recession?
BRUSSELS - THE 15 countries using the euro have slumped into a shallow recession in the face of the worst financial crisis in generations, the European Commission estimated on Monday.
Nov 3, 2008
S.Korea unveils stimulus
SOUTH Korea unveiled an economic stimulus plan on Monday and markets geared for more interest rate cuts in Europe and Australia in a frantic campaign to keep the financial crisis from plunging the world into its worst recession in decades.
Nov 3, 2008
Vietnam to cut prime rate
HANOI - VIETNAM'S central bank said it would cut the benchmark interest rate by one percentage point to 12 per cent on Wednesday in a bid to free up credit for businesses amid the global financial turmoil.
Nov 3, 2008
Indon inflation rises 11.77%
JAKARTA - INDONESIA'S inflation rate eased to 11.77 per cent year on year in October, the Central Statistics Agency said on Monday.
Nov 3, 2008
Consumer debt goes up
It indicates more people are unable to meet payments as crisis worsens
Posted by Anonymous in the Singapore Property Forum
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Saturday, November 1, 2008
About this Blog
"AIA S'pore lays off 20: More job losses expected in cost-cutting exercise begun before crisis hit its US parent."
Bull said:
What is 20 retrenchment??? compare to 200,000 new jobs we created this year.If you are not choosy, be realistic with your pay & jobs, no problem lah.
Bear said:
don't forget we've thousands of fresh-grad looking for jobs every year?
don't forget most new jobs created are in the construction industry .. can our retrenched bankers or even factory operators now go and take over blanga's constructional workers' positions?
be realistic with your pay and job... well said ... but how are you going to pay for the million dollar condo you committed earlier this year?
Another Bear said:
Moral of the story do not over commit to those overpriced condo..
Yet Another Bear said:
AIA axes 20 ... just slightly more than a week ago, Merrill Lynch also axed about 20 persons. i heard that very recently, standard charted also axed some (anyone care to confirm??)...
while I am not surprised that banks are cutting fat, these few... maybe 50 people are the "higher income" whose salaries and bonuses combined can easily be used to pay for 1000 workers in the construction and services industry... see the comparison???
so we create 200,000 jobs. Yeah, these are majority the low paying ones. But at the top line, our best paying industry (i.e. banks) are retrenching, most of it on the quiet and not so "visibly" like right now. This looks to me like incomes are going to shrink. The people in the banking & finance industry that were laid off... they were also the very same people that had the money in the first place to buy the condominiums. Many of them did indeed buy during the boom and they aren't necessarily going to be able to get a job with similar pay... let alone better pay to finance their earlier purchases. In fact, the higher up you are, when you are axed, the more difficult it is to find an equivalent job.
Guess what... this is going to be a vicious cycle. When their jobs are unstable, even the ones with loads of cash in the bank will think thrice about buying expensive properties.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Property Buyers be Prudent: Fewer Jobs, More Retrenchments Ahead
The following is a forum exchange on the deterioriating job market in Singapore (extracted from the Singapore Property Forum):"AIA S'pore lays off 20: More job losses expected in cost-cutting exercise begun before crisis hit its US parent."
Bull said:
What is 20 retrenchment??? compare to 200,000 new jobs we created this year.If you are not choosy, be realistic with your pay & jobs, no problem lah.
Bear said:
don't forget we've thousands of fresh-grad looking for jobs every year?
don't forget most new jobs created are in the construction industry .. can our retrenched bankers or even factory operators now go and take over blanga's constructional workers' positions?
be realistic with your pay and job... well said ... but how are you going to pay for the million dollar condo you committed earlier this year?
Another Bear said:
Moral of the story do not over commit to those overpriced condo..
Yet Another Bear said:
AIA axes 20 ... just slightly more than a week ago, Merrill Lynch also axed about 20 persons. i heard that very recently, standard charted also axed some (anyone care to confirm??)...
while I am not surprised that banks are cutting fat, these few... maybe 50 people are the "higher income" whose salaries and bonuses combined can easily be used to pay for 1000 workers in the construction and services industry... see the comparison???
so we create 200,000 jobs. Yeah, these are majority the low paying ones. But at the top line, our best paying industry (i.e. banks) are retrenching, most of it on the quiet and not so "visibly" like right now. This looks to me like incomes are going to shrink. The people in the banking & finance industry that were laid off... they were also the very same people that had the money in the first place to buy the condominiums. Many of them did indeed buy during the boom and they aren't necessarily going to be able to get a job with similar pay... let alone better pay to finance their earlier purchases. In fact, the higher up you are, when you are axed, the more difficult it is to find an equivalent job.
Guess what... this is going to be a vicious cycle. When their jobs are unstable, even the ones with loads of cash in the bank will think thrice about buying expensive properties.
May also want to read:
Fire Sale: Owners Dump Condos
The days of Cheap, Easy Credits chasing after property is OVER!
When the bubble of greed and fear burst, guess who suffer?
Property Investment Tip: Don't put all your eggs in one basket
HDB Resales: West Sees Highest Price Increase
Subscribe to:
Posts (Atom)
