Wednesday, March 19, 2008
About this Blog
Don't go on propaganding this rosy picture about IR and remaking Singapore, and so property price must go up. This rosy picture is good enough to keep Singaporeans with a fairly comfortable life but million dollars property is still out of the affordability for most. If such propaganda succeeds, then we will see more Singaporeans over paying for their property and living a miserable life working like dogs to pay off what should just be a roof over the head.
As long as the government is committed to meeting housing demand and keeping it affordable, there is no reason to believe that property price should go beyond the affordability of the average household.
Singapore Property is over-priced
Why's everybody blaming the US subprime problem for the poor take-up in the Singapore property market? The way I see it, the real problem is over-pricing. A typical unit in the suburb costs about $1M and can be rented for $3K which gives only a yield of 3%. That's a very high risk for such a low return. CPF gives 2.5% with no risk. Of course some people will argue that the rental yield is only to pay for the interest, "I can sell it at much higher price for profit" but if the present owner gets 3% and let's say he sells it at a higher price, then the next buyer will be looking at an even lower return ... eventually a property is only a home for someone and it boils down to people's affordability. With an average household income of $6K, a mass market priced above $1000 psf is simply beyond the reach of most people. It's simple mathematics.Don't go on propaganding this rosy picture about IR and remaking Singapore, and so property price must go up. This rosy picture is good enough to keep Singaporeans with a fairly comfortable life but million dollars property is still out of the affordability for most. If such propaganda succeeds, then we will see more Singaporeans over paying for their property and living a miserable life working like dogs to pay off what should just be a roof over the head.
As long as the government is committed to meeting housing demand and keeping it affordable, there is no reason to believe that property price should go beyond the affordability of the average household.
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Dear visitors:
Your comments are most welcome!
The blogger here has been affectionately named by close allies as "Smart Buyer" but really, he's not smart. Smart Buyer just believes that being prudent is smart. That's the essence of the message of this blog and Smart Buyer hopes it'll benefit other property buyers.
Smart Buyer :)