Showing posts with label 9.9 Singapore Property Crash Trends - Dec. Show all posts
Showing posts with label 9.9 Singapore Property Crash Trends - Dec. Show all posts
Thursday, January 1, 2009
About this Blog
"see who blinks first".
Its a seige. You rather starve than sell? OK, let's see if Singapore devlopers are somehow unique in being able to defy all history and the world in dissociating price from recessions and supply gluts. Already, once-proud markets have capitulated... from New York to London to Shanghai to HK... no one is immune.
"hunters pointed to just one reason: Home prices are still too high."
"Prices shooting beyond their (buyer's) means"
Its so funny. Like Bush, Pernanke and Paulson in early 2008 who, die, die also won't say the "R" word, developers won't admit that prices are too high even though its obvious to all. Machiam like "voldermort".
This denial still continues even when they tacitly admit to the realities.... sure, ok, I give in, you can have a 'rebate', a 'discount', a 'stamp duty absorption', 'furniture rebate' etc... just don't call it like what it is... a price fall.
"But the situation is set to worsen sharply for sellers as the economy contracts sharply"
Its not only worsening for sellers, but also buyers. As economy hits salaries, bonuses, and job-security of buyers, there will be fewer able or willing to pay the unrealistic price premiums commanded by sellers.
Posted by Ann in the Singapore Property Forum
May also want to read:
99 Leasehold Property: Calculation of Depreciation Rate based on Singapore Land Authority Data
Spore Property History 1960-2008
Property Investment Tip: Don't put all your eggs in one basket
HDB Resale Price Index 1990-2008: Graph & Chart
Property Buyers' one reason for not buying: Private Property Prices are still too high
Some comments on the article "Time to lower home prices; Straits Times 31 Dec 2008"..."see who blinks first".
Its a seige. You rather starve than sell? OK, let's see if Singapore devlopers are somehow unique in being able to defy all history and the world in dissociating price from recessions and supply gluts. Already, once-proud markets have capitulated... from New York to London to Shanghai to HK... no one is immune.
"hunters pointed to just one reason: Home prices are still too high."
"Prices shooting beyond their (buyer's) means"
Its so funny. Like Bush, Pernanke and Paulson in early 2008 who, die, die also won't say the "R" word, developers won't admit that prices are too high even though its obvious to all. Machiam like "voldermort".
This denial still continues even when they tacitly admit to the realities.... sure, ok, I give in, you can have a 'rebate', a 'discount', a 'stamp duty absorption', 'furniture rebate' etc... just don't call it like what it is... a price fall.
"But the situation is set to worsen sharply for sellers as the economy contracts sharply"
Its not only worsening for sellers, but also buyers. As economy hits salaries, bonuses, and job-security of buyers, there will be fewer able or willing to pay the unrealistic price premiums commanded by sellers.
Posted by Ann in the Singapore Property Forum
May also want to read:
99 Leasehold Property: Calculation of Depreciation Rate based on Singapore Land Authority Data
Spore Property History 1960-2008
Property Investment Tip: Don't put all your eggs in one basket
HDB Resale Price Index 1990-2008: Graph & Chart
Friday, December 26, 2008
About this Blog
FYI,i have been waiting since 2002 but the price of both HDB & private condo had risen almost every year. Recently,i am eyeing a three room HDB flat in clementi, Queentown or even marine parade but all these almost 30yrs old public housing are asking more than 200k. Do you think think if i have to wait for another one or two yrs will the price of these flats will drop by 30%.
Bear:
Don't bluff lah. Condo prices in 2004 and 2005 were so low - I bought one myself from a seller who made 30% loss. I think you are Mr Lan Lan, throwing red herrings to mislead people again.
Bull:
Mislead people????Any HDB three room flat more than 25yrs in Ang Mio Yio ,Clementi,Queentown or marine parade which are selling below 200k.Please let me know.Merry X'mas.
Bear:
HDB price has been going up steadily only from 2007. It's true that 25 yr old 3-rm HDB are selling above $200K now. Private property also recover only in 2007 but has dropped since Q3 2008, and data continues to show falling prices. These are facts.
You can't use rising HDB price to justify that private property price will also rise. Reason? Though there is real demand for housing, private property price has become unaffordable esp in the years to come as economy gets worse, and even the recovery is expected to be slow and spore will be having years of low growth. Income will drop and affordability will drop further. Plus difficulty in getting bank loans with the credit crunch. What will people with real housing needs do? Go for cheaper, smaller HDB flats! So smaller HDB flats will benefit most, that's why govt is building more of such flats. They have foresight and the data to know that people will be downgrading. As people downgrade, private property price will suffer even more..
Extracted from the Singapore Property Forum
May also want to read:
99 Leasehold Property: Calculation of Depreciation Rate based on Singapore Land Authority Data
Spore Property History 1960-2008
Property Investment Tip: Don't put all your eggs in one basket
HDB Resale Price Index 1990-2008: Graph & Chart
Rising HDB Price will support private property price?
Bull:FYI,i have been waiting since 2002 but the price of both HDB & private condo had risen almost every year. Recently,i am eyeing a three room HDB flat in clementi, Queentown or even marine parade but all these almost 30yrs old public housing are asking more than 200k. Do you think think if i have to wait for another one or two yrs will the price of these flats will drop by 30%.
Bear:
Don't bluff lah. Condo prices in 2004 and 2005 were so low - I bought one myself from a seller who made 30% loss. I think you are Mr Lan Lan, throwing red herrings to mislead people again.
Bull:
Mislead people????Any HDB three room flat more than 25yrs in Ang Mio Yio ,Clementi,Queentown or marine parade which are selling below 200k.Please let me know.Merry X'mas.
Bear:
HDB price has been going up steadily only from 2007. It's true that 25 yr old 3-rm HDB are selling above $200K now. Private property also recover only in 2007 but has dropped since Q3 2008, and data continues to show falling prices. These are facts.
You can't use rising HDB price to justify that private property price will also rise. Reason? Though there is real demand for housing, private property price has become unaffordable esp in the years to come as economy gets worse, and even the recovery is expected to be slow and spore will be having years of low growth. Income will drop and affordability will drop further. Plus difficulty in getting bank loans with the credit crunch. What will people with real housing needs do? Go for cheaper, smaller HDB flats! So smaller HDB flats will benefit most, that's why govt is building more of such flats. They have foresight and the data to know that people will be downgrading. As people downgrade, private property price will suffer even more..
Extracted from the Singapore Property Forum
May also want to read:
99 Leasehold Property: Calculation of Depreciation Rate based on Singapore Land Authority Data
Spore Property History 1960-2008
Property Investment Tip: Don't put all your eggs in one basket
HDB Resale Price Index 1990-2008: Graph & Chart
Wednesday, December 24, 2008
About this Blog
unfounded wrote:
Even all the uncompleted units are bought under DPS, there is no effect because these speculators or buyers bought under DPS in 2005/2006 are still sitting pretty with between 50% to 250% capital appreciation . Most of these speculators are rich and dont underestimate them, they have more wealth than you think. When they go to the bank, the valuation is still much higher than the purchase price and most of them get financing easily unless they got burnt badly in the stock or currency markets. The full impact of worldwide recession do not seem to hit Singapore too badly. With bank loans, what is the problem ? It is at low interests. Do you think property prices can drop by more than 50%? Impossible in politically safe Singapore, a Global city with IRs, Sport Hubs, YOG, F1,growing foreigners and rich migrants and so much to offer to investors. The Singapore government with billions in reserves will never let this happen and they will intervene strongly to prop up the market as they are also biggest property owners. Property market in Singapore is safe and unique, even for speculators of 2005/2006.
bull wrote:
come next month budget, govt is going to approve S$5B or more for infrastructure projects, the more the better, can create jobs, drive our GDP, eventually these development will make your property appreciate their value much more.
Like Jurong lake, if govt can complete it within 5 yrs from now on, that will be nice when it completes, Punggol marina center, Buona Vista R&D hub, MRT line, expressway.....
Guest wrote:
Buyers under DPS has to pay more in total, so those with cash will not opt for this. We can conclude many of these DPS buyers are shallow-pocket flippers. What makes it worse is the unexpected credit crunch. Besides, flippers are normally people with a risky-income profile like bankers, remisers, property agents ... who make a lot of money in the 2007-boom and became too optimistic about the property market. These people will be faced with sudden loss of income and will find it very hard to get a bank loan.
bear wrote:
DPS buyers cannot just walk away from the deals and think their maximum loss is the 10-20% downpayment. Developers can resell at any lower prices and the defaulting buyers will have to pay the difference plus all legal fees. So these shallow-pocket flippers will have to sell their units at whatever prices the market will pay. I see a property price crash coming from middle 2009.
May also want to read:
99 Leasehold Property: Calculation of Depreciation Rate based on Singapore Land Authority Data
Spore Property History 1960-2008
Property Investment Tip: Don't put all your eggs in one basket
HDB Resale Price Index 1990-2008: Graph & Chart
Will DPS Property Buyers default come 2009-2010? Property buyers' discussion
The following are some forumers' views on the recent news reports on defaulting DPS property buyers ( "Size of the DPS behemoth" and "D-Day for Home-Buyers") extracted from the Singapore Property Forum:unfounded wrote:
Even all the uncompleted units are bought under DPS, there is no effect because these speculators or buyers bought under DPS in 2005/2006 are still sitting pretty with between 50% to 250% capital appreciation . Most of these speculators are rich and dont underestimate them, they have more wealth than you think. When they go to the bank, the valuation is still much higher than the purchase price and most of them get financing easily unless they got burnt badly in the stock or currency markets. The full impact of worldwide recession do not seem to hit Singapore too badly. With bank loans, what is the problem ? It is at low interests. Do you think property prices can drop by more than 50%? Impossible in politically safe Singapore, a Global city with IRs, Sport Hubs, YOG, F1,growing foreigners and rich migrants and so much to offer to investors. The Singapore government with billions in reserves will never let this happen and they will intervene strongly to prop up the market as they are also biggest property owners. Property market in Singapore is safe and unique, even for speculators of 2005/2006.
bull wrote:
come next month budget, govt is going to approve S$5B or more for infrastructure projects, the more the better, can create jobs, drive our GDP, eventually these development will make your property appreciate their value much more.
Like Jurong lake, if govt can complete it within 5 yrs from now on, that will be nice when it completes, Punggol marina center, Buona Vista R&D hub, MRT line, expressway.....
Guest wrote:
Buyers under DPS has to pay more in total, so those with cash will not opt for this. We can conclude many of these DPS buyers are shallow-pocket flippers. What makes it worse is the unexpected credit crunch. Besides, flippers are normally people with a risky-income profile like bankers, remisers, property agents ... who make a lot of money in the 2007-boom and became too optimistic about the property market. These people will be faced with sudden loss of income and will find it very hard to get a bank loan.
bear wrote:
DPS buyers cannot just walk away from the deals and think their maximum loss is the 10-20% downpayment. Developers can resell at any lower prices and the defaulting buyers will have to pay the difference plus all legal fees. So these shallow-pocket flippers will have to sell their units at whatever prices the market will pay. I see a property price crash coming from middle 2009.
May also want to read:
99 Leasehold Property: Calculation of Depreciation Rate based on Singapore Land Authority Data
Spore Property History 1960-2008
Property Investment Tip: Don't put all your eggs in one basket
HDB Resale Price Index 1990-2008: Graph & Chart
Friday, December 19, 2008
About this Blog
Citizen wrote:
if US$crash and very likely it will, interest rates will skyrocket and a panic ensue, creating a BIG rush out of US$ assets in billions and even trillions. The market will be in another turmoil Assets and economies invested heavily in US$ can be destroyed and the consequences are disastrous. Dont dream that Singapore overpriced property is a hedge and all these major economies and investors cannot find a safe heaven and divert to Singapore. when investors are so badly hit, there is a spiral effect and it will create even more fear. Affected economies will look after their domestic problems and investment before looking outside. Look around and do some serious research in other countries, there are far more safer, cheaper and attractive options than investing in Singapore overpriced properties. Even our Temasek and GIC if you see are investing overseas and they haven proven correctly that their return is still better so far. Think about it carefully what so attractive and competitive of overpriced properties in Singapore. It has not even fallen to meaningful level and probably not because the budget next month should again likely to aim at propping up properties prices and improve sentiment and some unwary speculators and investors can be trapped or does it really matter. Better to stay away from such BIG financial commitment. No big deal to miss the boat except for the wealthy and rich speculators who always want more. Ordinary citizens and small invesors :Be safe than sorry, no need so much or show off or envious about. Humble opinion.
Anonymous wrote:
US$ crash is for sure, funds of US$Trillin will flow to Asia for sure, this is the reverse of 1997 Asia financial crisis. China will push demand till 2-4x of current US demand, want to do biz, want infrastructure projects....80% is in Asia. RMB$4Trillion development is just the beginning, another 5 round of bigger size stimulus packegae is on the way in coming months to years.
Why US property drive to big bubble in 2007? The bubble started to build up in 1998, influx of Millions of Asian flew to US afetr Asia crisis, that is the beginnig of Silicon Valley...wall st.....every corner of US, you will immigrants & foreign talents. US property up all the way from 1998 to 2007. When Asia crisis started for 1 yr, US property escalate. So later next year, we will start to see influx of ang mo.
Quesstion now is US drop in demand can be pick up by Asia? US drop in dmand is the most 1-2%, is not drop by 10-20%, with China + India= 10x US population, can't the govt stimulate the economy to achieve a small drop in US demand?
Cheap US$ with 0% rate is everywhere in the world next year, they are printing it unlimitedly, Obama will have to print more, when the effect of these money surface, tyhe begin of another big bubble, especially in Asia which have US$Trillion of reserved & is going to cash out when times come, plus all the rush of coneversion of US$ to asian currency to flock here.....worse than tsunami when it triggers....
Guest wrote;
Money needs to be constantly circulated as efficiently as possible to maintain economic productivity. Right now, too much money is idle in banks and reserves, and not being put to productive use.
As Americans spend less, China knows already that it needs to start spending more to hasten economic recovery, else if this trend continues, it will lead to ever slowing growth and eventually social instability as more people go out of work and can't afford basic necessities.
The US can only do so much as reduce their interest rates to near-zero so it needs China to do it's part as well as all the economies are interconnected. I expect in the next one year we will start seeing increased spending from the Asian powers, better flow of liquidity and recovery in the health of the global economy.
So what does this mean for Singapore property 2009? Prices will probably remain above 2006 levels, but not as exuberant as 2007. A good time to upgrade or purchase for own-stay, especially if there are urgent sales from owners of multiple properties (and there are plenty of such these days). I see a great future for Singapore as a global city for the wealthy, but private property is still too expensive an investment option for most people, and unlikely to be able to "flip" for quick profits.
May also want to read:
99 Leasehold Property: Calculation of Depreciation Rate based on Singapore Land Authority Data
Spore Property History 1960-2008
Property Investment Tip: Don't put all your eggs in one basket
HDB Resale Price Index 1990-2008: Graph & Chart
Impact of US Dollar Crash on Property Price
Extracted from the Singapore Property Forum :Citizen wrote:
if US$crash and very likely it will, interest rates will skyrocket and a panic ensue, creating a BIG rush out of US$ assets in billions and even trillions. The market will be in another turmoil Assets and economies invested heavily in US$ can be destroyed and the consequences are disastrous. Dont dream that Singapore overpriced property is a hedge and all these major economies and investors cannot find a safe heaven and divert to Singapore. when investors are so badly hit, there is a spiral effect and it will create even more fear. Affected economies will look after their domestic problems and investment before looking outside. Look around and do some serious research in other countries, there are far more safer, cheaper and attractive options than investing in Singapore overpriced properties. Even our Temasek and GIC if you see are investing overseas and they haven proven correctly that their return is still better so far. Think about it carefully what so attractive and competitive of overpriced properties in Singapore. It has not even fallen to meaningful level and probably not because the budget next month should again likely to aim at propping up properties prices and improve sentiment and some unwary speculators and investors can be trapped or does it really matter. Better to stay away from such BIG financial commitment. No big deal to miss the boat except for the wealthy and rich speculators who always want more. Ordinary citizens and small invesors :Be safe than sorry, no need so much or show off or envious about. Humble opinion.
Anonymous wrote:
US$ crash is for sure, funds of US$Trillin will flow to Asia for sure, this is the reverse of 1997 Asia financial crisis. China will push demand till 2-4x of current US demand, want to do biz, want infrastructure projects....80% is in Asia. RMB$4Trillion development is just the beginning, another 5 round of bigger size stimulus packegae is on the way in coming months to years.
Why US property drive to big bubble in 2007? The bubble started to build up in 1998, influx of Millions of Asian flew to US afetr Asia crisis, that is the beginnig of Silicon Valley...wall st.....every corner of US, you will immigrants & foreign talents. US property up all the way from 1998 to 2007. When Asia crisis started for 1 yr, US property escalate. So later next year, we will start to see influx of ang mo.
Quesstion now is US drop in demand can be pick up by Asia? US drop in dmand is the most 1-2%, is not drop by 10-20%, with China + India= 10x US population, can't the govt stimulate the economy to achieve a small drop in US demand?
Cheap US$ with 0% rate is everywhere in the world next year, they are printing it unlimitedly, Obama will have to print more, when the effect of these money surface, tyhe begin of another big bubble, especially in Asia which have US$Trillion of reserved & is going to cash out when times come, plus all the rush of coneversion of US$ to asian currency to flock here.....worse than tsunami when it triggers....
Guest wrote;
Money needs to be constantly circulated as efficiently as possible to maintain economic productivity. Right now, too much money is idle in banks and reserves, and not being put to productive use.
As Americans spend less, China knows already that it needs to start spending more to hasten economic recovery, else if this trend continues, it will lead to ever slowing growth and eventually social instability as more people go out of work and can't afford basic necessities.
The US can only do so much as reduce their interest rates to near-zero so it needs China to do it's part as well as all the economies are interconnected. I expect in the next one year we will start seeing increased spending from the Asian powers, better flow of liquidity and recovery in the health of the global economy.
So what does this mean for Singapore property 2009? Prices will probably remain above 2006 levels, but not as exuberant as 2007. A good time to upgrade or purchase for own-stay, especially if there are urgent sales from owners of multiple properties (and there are plenty of such these days). I see a great future for Singapore as a global city for the wealthy, but private property is still too expensive an investment option for most people, and unlikely to be able to "flip" for quick profits.
May also want to read:
99 Leasehold Property: Calculation of Depreciation Rate based on Singapore Land Authority Data
Spore Property History 1960-2008
Property Investment Tip: Don't put all your eggs in one basket
HDB Resale Price Index 1990-2008: Graph & Chart
Thursday, December 18, 2008
About this Blog
ann wrote:
Certainly, indiscriminate printing of US$ will lead to devaluation of the US$. Thus far, Asians have picked up the slack, but recent comments from China and Singapore seem to indicate Asia's patience is wearing thin....
PM Lee:
www.straitstimes.com/Breaking%2BNews/Singapore/Story/STIStory_307925.html
imbalances which had built up over the past five to seven years between the United States, which has run up huge budget deficits, and Asia, with burgeoning surpluses.
'We can't go back to where we were before, which is, Asians lend money to Americans... Americans borrow money to spend,' said Mr Lee. 'So how do we get savings and consumption back in balance?'
With the American consumer cutting back, someone else - whether the Chinese or the Indians - has to pick up the slack. The whole world would need to adjust to the new situation forced upon it by the crisis, he said.
The China Daily
www.straitstimes.com/Breaking%2BNews/Money/Story/STIStory_315471.html
BEIJING - CHINA warned on Wednesday it would not keep lending money to the US economy indefinitely, even as new data showed it had consolidated its position as the top buyer of American government bonds.
'China's increased purchase of US Treasury securities should not be interpreted as an endorsement of the assumption that the US can borrow its way out of the current financial crisis,' the China Daily said in an editorial.
The warning from the state-run newspaper, an English-language daily that mainly addresses a foreign audience, came after the US Treasury Department reported a steep increase in Chinese holding of US Treasury bonds.
The China Daily said that, given the global economic crisis, the consequences would be serious if China and other nations stopped channelling money into the US economy.
'Interest rates in the US would rise to undermine that government's efforts to bailout distressed financial institutions and companies,' it said.
Anonymous wrote:
Much as China, and perhaps, Singapore, are getting impatient and possibly, fed-up with being at the mercy's of the US economy, their economies are so entrenched that to stop lending to US is easier say than done. The middle class populations in India and China are still too small to pick up the slack. The way I see it, it'll take another decade at least to balance the savings and consumptions imbalances in the current global economy.
Guest wrote:
Money needs to be constantly circulated as efficiently as possible to maintain economic productivity. Right now, too much money is idle in banks and reserves, and not being put to productive use.
As Americans spend less, China knows already that it needs to start spending more to hasten economic recovery, else if this trend continues, it will lead to ever slowing growth and eventually social instability as more people go out of work and can't afford basic necessities.
The US can only do so much as reduce their interest rates to near-zero so it needs China to do it's part as well as all the economies are interconnected. I expect in the next one year we will start seeing increased spending from the Asian powers, better flow of liquidity and recovery in the health of the global economy.
So what does this mean for Singapore property 2009? Prices will probably remain above 2006 levels, but not as exuberant as 2007. A good time to upgrade or purchase for own-stay, especially if there are urgent sales from owners of multiple properties (and there are plenty of such these days). I see a great future for Singapore as a global city for the wealthy, but private property is still too expensive an investment option for most people, and unlikely to be able to "flip" for quick profits.
Contine with: Impact of US Dollar Crash on Property Price
May also want to read:
99 Leasehold Property: Calculation of Depreciation Rate based on Singapore Land Authority Data
Spore Property History 1960-2008
Property Investment Tip: Don't put all your eggs in one basket
HDB Resale Price Index 1990-2008: Graph & Chart
Impact of US Dollar Crash on Property Market
Extracted from the Singapore Property Forum :ann wrote:
Certainly, indiscriminate printing of US$ will lead to devaluation of the US$. Thus far, Asians have picked up the slack, but recent comments from China and Singapore seem to indicate Asia's patience is wearing thin....
PM Lee:
www.straitstimes.com/Breaking%2BNews/Singapore/Story/STIStory_307925.html
imbalances which had built up over the past five to seven years between the United States, which has run up huge budget deficits, and Asia, with burgeoning surpluses.
'We can't go back to where we were before, which is, Asians lend money to Americans... Americans borrow money to spend,' said Mr Lee. 'So how do we get savings and consumption back in balance?'
With the American consumer cutting back, someone else - whether the Chinese or the Indians - has to pick up the slack. The whole world would need to adjust to the new situation forced upon it by the crisis, he said.
The China Daily
www.straitstimes.com/Breaking%2BNews/Money/Story/STIStory_315471.html
BEIJING - CHINA warned on Wednesday it would not keep lending money to the US economy indefinitely, even as new data showed it had consolidated its position as the top buyer of American government bonds.
'China's increased purchase of US Treasury securities should not be interpreted as an endorsement of the assumption that the US can borrow its way out of the current financial crisis,' the China Daily said in an editorial.
The warning from the state-run newspaper, an English-language daily that mainly addresses a foreign audience, came after the US Treasury Department reported a steep increase in Chinese holding of US Treasury bonds.
The China Daily said that, given the global economic crisis, the consequences would be serious if China and other nations stopped channelling money into the US economy.
'Interest rates in the US would rise to undermine that government's efforts to bailout distressed financial institutions and companies,' it said.
Anonymous wrote:
Much as China, and perhaps, Singapore, are getting impatient and possibly, fed-up with being at the mercy's of the US economy, their economies are so entrenched that to stop lending to US is easier say than done. The middle class populations in India and China are still too small to pick up the slack. The way I see it, it'll take another decade at least to balance the savings and consumptions imbalances in the current global economy.
Guest wrote:
Money needs to be constantly circulated as efficiently as possible to maintain economic productivity. Right now, too much money is idle in banks and reserves, and not being put to productive use.
As Americans spend less, China knows already that it needs to start spending more to hasten economic recovery, else if this trend continues, it will lead to ever slowing growth and eventually social instability as more people go out of work and can't afford basic necessities.
The US can only do so much as reduce their interest rates to near-zero so it needs China to do it's part as well as all the economies are interconnected. I expect in the next one year we will start seeing increased spending from the Asian powers, better flow of liquidity and recovery in the health of the global economy.
So what does this mean for Singapore property 2009? Prices will probably remain above 2006 levels, but not as exuberant as 2007. A good time to upgrade or purchase for own-stay, especially if there are urgent sales from owners of multiple properties (and there are plenty of such these days). I see a great future for Singapore as a global city for the wealthy, but private property is still too expensive an investment option for most people, and unlikely to be able to "flip" for quick profits.
Contine with: Impact of US Dollar Crash on Property Price
May also want to read:
99 Leasehold Property: Calculation of Depreciation Rate based on Singapore Land Authority Data
Spore Property History 1960-2008
Property Investment Tip: Don't put all your eggs in one basket
HDB Resale Price Index 1990-2008: Graph & Chart
Monday, December 8, 2008
About this Blog
We can roughly said that there are some events which will likely to derail whatever efforts the world governments have done. The repercussions to the world and small city like Singapore will be very serious:
1) the financial system in the world have been broken so severely that it impairs the US and Europe economy ability to relevage and completely mute the strength of its cyclical recovery. These are major economies and the richest of the richest in the past. THis is very bad for Singapore who is totally dependent on the two sinful casinos and constructional activities to spur economic growth and jobs. Singapore do not have a motherland like HK or Sydney to fall back and we are just compliant citizens and not entreprenuers. We need the government to hold our hands.
2) as more jobs are lost (soon in millions) in major economies, it is a liquidity trap and any fiscal or interest cuts have no effects resulting in fear and people not spending or hoarding cash. More layoffs is coming to Singapore as Singaoreans will be hard hit. Worst in Singapore, people are heavy in assets and as they age and easily "kiasu" they become more conservative, lonely and withdraw, not willing to spend. They will save for fear of ill health (high hospital bills) thanks to our non-welfare state.
3) the US is now a debtor nation and owes the rest of the world more than US$2trillions. the US$ can crash and there is a real risk of a major currency crisis as investors shun dollar based assets resulting in more deflation of assets denominated in US$. Another crisis is now looming as the rise in US$ is too steep like another bubble in the making.
4) Look at China, yes mighty and GDP of 7 to 9 % growth even at this time. But they have to generate 24m jobs every year. It is a very difficult country to manage (nothing compare to managing Singapore) and how you expect a slowdown will bring jobless youth and workers there with no social problems in a billion population country? Factories after factories are closing and some places are ghost towns and white elephants. Dont forget the Chinese are smarter and sophisticated than compliant Singaporeans and their talent is unlimited. We have so much investments privately and publicly there. The repercussion is unimaginable and our country could be swamped by them and rich and educated FTs.
5) we have invested so heavily in ailing overseas banks and corporates overseas at a "rock bottom" prices for the "long term" and left with the choice of selling Power Seraya and SFI (which are jewels in Singapore) to raise cash or improve our finance. THis is a very sad state as i cant imagine that we have to tap our foreign reserves sooner or later.
6) We have not discounted the political and social or even terrorists lurking around at our door steps. Where is MAS SELAMAT? You think he just relax under a coconut tree> Such dangerous man who can outwit our world class security system, could possibly be inspired by the Mumbai attack and planning for a return in an more organised and intricate manner? We cannot rule this out. It can be a serious threat!
Our government can introduce a string of fiscal and monetary policies to stimulate property demand to help the cash rich developers preserve their cash and capital gains but we have to set priority on helping the people, the aged, sick, the national servicemen and true Singaporeans instead of investing, investing, property, property, Casinos and Casinos, F1 and F1 or FT or FT, and always wants to be the best in the world. We dont really need all these. We just hope that there is no nasty surprise to derail everything otherwise the bottom could really be unreachable in the coming years. Not trying to be pessimistic but really we dont know and it looks like a recovery will be a long long long one.
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
Recovery from Recession a long, long one
Posted by Concerned Singaporean in the Singapore Property ForumWe can roughly said that there are some events which will likely to derail whatever efforts the world governments have done. The repercussions to the world and small city like Singapore will be very serious:
1) the financial system in the world have been broken so severely that it impairs the US and Europe economy ability to relevage and completely mute the strength of its cyclical recovery. These are major economies and the richest of the richest in the past. THis is very bad for Singapore who is totally dependent on the two sinful casinos and constructional activities to spur economic growth and jobs. Singapore do not have a motherland like HK or Sydney to fall back and we are just compliant citizens and not entreprenuers. We need the government to hold our hands.
2) as more jobs are lost (soon in millions) in major economies, it is a liquidity trap and any fiscal or interest cuts have no effects resulting in fear and people not spending or hoarding cash. More layoffs is coming to Singapore as Singaoreans will be hard hit. Worst in Singapore, people are heavy in assets and as they age and easily "kiasu" they become more conservative, lonely and withdraw, not willing to spend. They will save for fear of ill health (high hospital bills) thanks to our non-welfare state.
3) the US is now a debtor nation and owes the rest of the world more than US$2trillions. the US$ can crash and there is a real risk of a major currency crisis as investors shun dollar based assets resulting in more deflation of assets denominated in US$. Another crisis is now looming as the rise in US$ is too steep like another bubble in the making.
4) Look at China, yes mighty and GDP of 7 to 9 % growth even at this time. But they have to generate 24m jobs every year. It is a very difficult country to manage (nothing compare to managing Singapore) and how you expect a slowdown will bring jobless youth and workers there with no social problems in a billion population country? Factories after factories are closing and some places are ghost towns and white elephants. Dont forget the Chinese are smarter and sophisticated than compliant Singaporeans and their talent is unlimited. We have so much investments privately and publicly there. The repercussion is unimaginable and our country could be swamped by them and rich and educated FTs.
5) we have invested so heavily in ailing overseas banks and corporates overseas at a "rock bottom" prices for the "long term" and left with the choice of selling Power Seraya and SFI (which are jewels in Singapore) to raise cash or improve our finance. THis is a very sad state as i cant imagine that we have to tap our foreign reserves sooner or later.
6) We have not discounted the political and social or even terrorists lurking around at our door steps. Where is MAS SELAMAT? You think he just relax under a coconut tree> Such dangerous man who can outwit our world class security system, could possibly be inspired by the Mumbai attack and planning for a return in an more organised and intricate manner? We cannot rule this out. It can be a serious threat!
Our government can introduce a string of fiscal and monetary policies to stimulate property demand to help the cash rich developers preserve their cash and capital gains but we have to set priority on helping the people, the aged, sick, the national servicemen and true Singaporeans instead of investing, investing, property, property, Casinos and Casinos, F1 and F1 or FT or FT, and always wants to be the best in the world. We dont really need all these. We just hope that there is no nasty surprise to derail everything otherwise the bottom could really be unreachable in the coming years. Not trying to be pessimistic but really we dont know and it looks like a recovery will be a long long long one.
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, December 2, 2008
About this Blog
Derrek wrote:
"While I realise that catching the bottom of the market requires luck more than anything else, there is no harm in trying to improve the odds, is there?
I'll start first. Please feel free to chip in and/or correct me if any of the information presented is inaccurate.
All of us have thrown out numbers about how far we think the market will fall, from 20% to 60%. I would like to suggest that we standardise the discussion by referring to the Private Residential Property price index:
Current Index (based on Q3 2008 Figures)
Index uses Q4 1998 as benchmark. i.e. Index = 100
Overall : 173.3
Landed : 158.8
Detached: 167.4
Semi-D : 150.2
Terrace : 154.3
Non Landed: 176.7
Apartment: 182.0
Condo : 174.0
The million dollar question is: Where do we think the index will drop to?
Will it go below 100? That was the level largely due to the Asian Financial crisis. Although the signs are that this crisis is larger and more widespread, it does not automatically translate to the PPI falling below 100.
For starters, from what I can see about the methodology, the PPI captures absolute numbers, not numbers adjusted for inflation (pls enlighten if I am mistaken). Does that mean that any estimates (guesstimates) will also have to consider median/mean (debatable which is a better measure in this case given we are looking at private property prices) incomes levels currently vis a vis 1998?
There are so many factors to consider, and I look forward to having a healthy online discussion about it. "
Ferrari wrote:
"Let me be your first visitor to comment. I think index-wise will take a long time to drop due to the time lag between the actual buy/sell decision point (usually option to purchase) to the time coveat lodge and finally to be calculated into the index. Also, index usually take into consideration only those property that have transaction. For those without any transaction, it will only 'dilute' the actual price movement. Anyhow, I think the index will drop below 100 if crisis will to prolong (which I think it will be the case)."
Anonymous wrote:
"I don't know where exactly is the bottom but I think next year is very, very likely to be worse than this year. So I think it pays to wait to see how next year goes."
Smart Buyer wrote:
"Derek, indeed, this is the time to discuss about the property's bottom. Impossible as it is to identify exactly where the bottom is, it's still a constructive and helpful discussion.
I agree with the view that next year is very likely going to sink further. Beyond that, there's no visibility.
Here are some pointers to signal the bottom:
1. After 3 to 4 quarters of recession
2. High unemployment rate
3. High vacancy rate
4. High bankruptcies
5. Property & Bank stocks plunge
(ps add to the list)
Only point 5 has happened. "
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
Where's the Property Bottom? Property Buyers' Discussion
Forum discussion on "Where's the Property Bottom" extracted from the Singapore Property Forum:Derrek wrote:
"While I realise that catching the bottom of the market requires luck more than anything else, there is no harm in trying to improve the odds, is there?
I'll start first. Please feel free to chip in and/or correct me if any of the information presented is inaccurate.
All of us have thrown out numbers about how far we think the market will fall, from 20% to 60%. I would like to suggest that we standardise the discussion by referring to the Private Residential Property price index:
Current Index (based on Q3 2008 Figures)
Index uses Q4 1998 as benchmark. i.e. Index = 100
Overall : 173.3
Landed : 158.8
Detached: 167.4
Semi-D : 150.2
Terrace : 154.3
Non Landed: 176.7
Apartment: 182.0
Condo : 174.0
The million dollar question is: Where do we think the index will drop to?
Will it go below 100? That was the level largely due to the Asian Financial crisis. Although the signs are that this crisis is larger and more widespread, it does not automatically translate to the PPI falling below 100.
For starters, from what I can see about the methodology, the PPI captures absolute numbers, not numbers adjusted for inflation (pls enlighten if I am mistaken). Does that mean that any estimates (guesstimates) will also have to consider median/mean (debatable which is a better measure in this case given we are looking at private property prices) incomes levels currently vis a vis 1998?
There are so many factors to consider, and I look forward to having a healthy online discussion about it. "
Ferrari wrote:
"Let me be your first visitor to comment. I think index-wise will take a long time to drop due to the time lag between the actual buy/sell decision point (usually option to purchase) to the time coveat lodge and finally to be calculated into the index. Also, index usually take into consideration only those property that have transaction. For those without any transaction, it will only 'dilute' the actual price movement. Anyhow, I think the index will drop below 100 if crisis will to prolong (which I think it will be the case)."
Anonymous wrote:
"I don't know where exactly is the bottom but I think next year is very, very likely to be worse than this year. So I think it pays to wait to see how next year goes."
Smart Buyer wrote:
"Derek, indeed, this is the time to discuss about the property's bottom. Impossible as it is to identify exactly where the bottom is, it's still a constructive and helpful discussion.
I agree with the view that next year is very likely going to sink further. Beyond that, there's no visibility.
Here are some pointers to signal the bottom:
1. After 3 to 4 quarters of recession
2. High unemployment rate
3. High vacancy rate
4. High bankruptcies
5. Property & Bank stocks plunge
(ps add to the list)
Only point 5 has happened. "
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
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