View Full Version : Is HDB The World's Most Lucrative Get Rich Scheme, With A Legitimate Ponzi Touch?
Is HDB The World's Biggest And Most Lucrative Get Rich Scheme, With A Legitimate Ponzi Touch?
Just for discussion. I give my view, you give yours. No need to get angry. Have some fun.
I have been thinking, how come my 3R HDB flat can be worth so much today. This year, one unit in my block was sold for about $380K. I dun know its original price, 40+ years ago. Probably less than 10K.
Those who bought their HDB flats in the past can sell at higher prices now. Those who bought early or earliest has the most % gain. Those who bought later, or bought resale units, pay more but if they have holding power, and kept their units until today, all would be able to sell at a higher price. Many readers here have relatives that bought their HDB flats a long time ago. Today their HDB flats is worth many times their purchase price. Owning a HDB flat is a very lucrative investment.
Many, including myself have made money from owning a HDB flat. I am richer now because I participated in this HDB housing scheme. I don't know if there are any other legitimate scheme in the world that would make so many people rich, if they qualify and a decides to participate, early.
I ask myself, how come buyers are willing to pay so much these days to lease space from the Singapore government. I believed HDB resale prices can only go up if more Citizens and PRs wants to buy and less owners want to sell. Why is this the case now, where buyers are willing to pay record prices for HDB flats. Could it be due to strong demand from immigrants, cheap money and the belief that owning a HDB flat is a good investment?
Can prices continue to go higher? Will those who buy now, get richer in the future? Many readers here would say yes. I am a little skeptical, as some other person has to be willing to pay more to participate in order for those who participated earlier to get rich. This is like a ponzi scheme, isn't it? Late comers pay more so that early birds can make money.
Will this legitimate HDB get rich scheme last indefinitely? Surely there is a limit to how much the younger generations can or are willing to pay for the older citizens and PRs to be wealthy.
I know the risks but I am going to continue being a part of this scheme. How can I get out? I need a roof under my head!
phantom_opera
22-08-12, 20:46
Let's look at the facts first
In 1990, HDB RPI is 34
In 1996, it hits a peak of 136.9, this was definitely a super bubble by any standard as in a short space of 6y, RPI went up from 34 to 136 (4 X) and I think PAP really screwed up during the 1990-1996 period in allowing the bubble to develop.
However, things look more manageable now. Today the RPI stands at 195, from 34 to 195 in 22y means about 9.5% pa ... much higher than inflation rate, of course this has not even factored in rental yield if one is able to rent it out.
Let's look at STI from the same period. It was 1500 at 1990, now it doubles at 3000+ ... assume a dividend of 4% per year, it roughly yields about 7% pa
Why would then HDB is able to outperform STI? One reason of course could be STI is now undervalued. Another reason of course is we face a shortage of completed HDBs right now due to too many immigrants. Yet another reason is most middle class CPF OA money are used to pay HDB, and PAP expects middle class to monetize it for retirement
ikan bilis
22-08-12, 23:35
jim rogers: In the Mid-Sixties Wall Street Was A Wasteland
"When I went to Wall Street in the mid 60`s, it was a wasteland. I tell you, nobody went there."
jim rojak's talk makes me think of:
100yrs ago, s'pore must be wasteland... 40-50yr ago they started building hdb, sold at <10K... from 3rd world moved to 1st world now and hdb at 0.5mil... another 20-30 years in future ?? will it be ponzi ?? umm,... me don't know leh....
(sorry-arh... me very wu-kong-kana-boh-kong/"got talked like no-talked"... :doh: )
I see 2 groups of people benefiting from the gain:
1. Downgraders: Couple whose children have flown the nest and they want to downgrade to a smaller HDB flat.
2. Upgraders: Middle income who can sell their HDB flat, top up with savings and loan, and get a private condo.
Other than that, the gain is only on paper as you still need a roof over your head.
ikan bilis
22-08-12, 23:53
I see 2 groups of people benefiting from the gain:
1. Downgraders: Couple whose children have flown the nest and they want to downgrade to a smaller HDB flat.
2. Upgraders: Middle income who can sell their HDB flat, top up with savings and loan, and get a private condo.
Other than that, the gain is only on paper as you still need a roof over your head.
3. investors: those holding hdb as investment property, stay in condo and milking high yield rental income from hdb... resale price up rental will also be up eventually....
3. investors: those holding hdb as investment property, stay in condo and milking high yield rental income from hdb... resale price up rental will also be up eventually....
i am aiming to become No..3...:cheers5:
Regulators
23-08-12, 01:10
Let me try to answer the question. Property prices are the way it is now coz of govt's policies. You should be asking why the govt has such a policy. I believe it is to maintain power. Our grandfather let the cat out of the bag during one of his speeches, he said that if the opposition took over the govt, he told us to imagine what would happen to property prices. the pty prices are driven up to give ppl a false sense of security that only with the current govt will prices continue to remain stable. With people slowly spiralling into bigger and bigger debts due to rising pty prices, it will inevitably cause fear in those vested in property to even think of an alternative govt so as to guard their assets. I do not think govt ever had the intention to quell the prices, they are just slowing down the pace a little to pacify the noise makers.
like all big major cities the property prices are high becoz it attract more people. look at tokyo, london, NY, San Francisco, Sydney, Frankfurt , Vienna , Seoul etc... all the tier major capital city will have escalation in property price.
Further more the last couple of years thanks to US. We inflation is especially high in Asia. look at Malaysia, Thailand, Vietnam, Indo.. the inflation no.s are all very high.
So Singapore regardless will have the same impact.
3. investors: those holding hdb as investment property, stay in condo and milking high yield rental income from hdb... resale price up rental will also be up eventually....
4. investors: those holding hdb as investment property, rent out condo and get posted oversea with housing allowance. Resale price up, rental will also be up eventually and before retirement sell all property and buy a 3 room HDB in Marine Terrace and everyday wash his BMW 5 series.
Let me try to answer the question. Property prices are the way it is now coz of govt's policies. You should be asking why the govt has such a policy. I believe it is to maintain power. Our grandfather let the cat out of the bag during one of his speeches, he said that if the opposition took over the govt, he told us to imagine what would happen to property prices. the pty prices are driven up to give ppl a false sense of security that only with the current govt will prices continue to remain stable. With people slowly spiralling into bigger and bigger debts due to rising pty prices, it will inevitably cause fear in those vested in property to even think of an alternative govt so as to guard their assets. I do not think govt ever had the intention to quell the prices, they are just slowing down the pace a little to pacify the noise makers.
5 CMs, increase GLS, increase BTO, increase EC, increase income ceiling, control HDB valuation, still don't think govt ever had the intention to quell the prices,:doh:
Can give suggestion what else do you think the govt can do?
I see 2 groups of people benefiting from the gain:
1. Downgraders: Couple whose children have flown the nest and they want to downgrade to a smaller HDB flat.
2. Upgraders: Middle income who can sell their HDB flat, top up with savings and loan, and get a private condo.
Other than that, the gain is only on paper as you still need a roof over your head.
Agree with you. The thread starter dont understand the meaning of investment and inflation.
phantom_opera
23-08-12, 08:29
BTO with subsidy has very high ROI within 5y
BTO with subsidy has very high ROI within 5y
http://nsp.sg/2012/08/16/the-nsp-housing-forum-sat-25-aug/
NSP is holding a housing forum to talk about making HDB available to the under 35 years old singles..
Nicole Seah (佘雪玲)
Are you single, under 35 years old, and think you should have the right to buy a HDB flat? Speak up for what you want and make your opinion count at the upcoming NSP Housing forum this Saturday, 25 August. See you!
phantom_opera
23-08-12, 08:45
BTO for singles, u can dream on, it will result in even lower birth rate and may result in deficit for hdb as the number of singles males btn 30 to 34 is 44pc as highlighted by lky
Chillyred888
23-08-12, 08:47
http://nsp.sg/2012/08/16/the-nsp-housing-forum-sat-25-aug/
Nicole Seah (佘雪玲)
Are you single, under 35 years old, and think you should have the right to buy a HDB flat? Speak up for what you want and make your opinion count at the upcoming NSP Housing forum this Saturday, 25 August. See you!
They should also address to allowing singles above 35 to buy BTO hdb as well
phantom_opera
23-08-12, 09:05
Opposition parties are populists ... no credible economic talents.. otherwise they should have just bombarded MAS policy of super low interest rate .... don't they know super low interest rate and tight labor market is a recipe for high inflation?
Back to HDB issue, if you allow singles below 35 to buy BTO, how about Singapore man who married foreigner?? I know many cannot apply for BTO because spouse cannot get SPR :mad:
BTO for singles, u can dream on, it will result in even lower birth rate and may result in deficit for hdb as the number of singles males btn 30 to 34 is 44pc as highlighted by lky
Look at it on the bright side, I'll have many children and use all their names to buy hdb. One each and after mop rent them all out! Baby boom!!:D :cheers5:
phantom_opera
23-08-12, 09:22
Look at it on the bright side, I'll have many children and use all their names to buy hdb. One each and after mop rent them all out! Baby boom!!:D :cheers5:
No way, no one will give birth just because of this. Then it will be exploited by singles as cash cow easily. As a single, you can get the BTO, rent it out immediately by having a job overseas. :doh: Couples can do that but at least there is a chance for pro-creation
3. investors: those holding hdb as investment property, stay in condo and milking high yield rental income from hdb... resale price up rental will also be up eventually....
Actually I don't see why we can't make use of our HDB flats for rental if we have been prudent enough to save up to buy a condo. Look, the government's stand has always been that Singapore is not a welfare state. You only get public assistance if you are very poor, penniless.
For the middle income and lower middle income, good luck to you if you don't have sufficient savings for your retirement. The government is not going to help you. So what choice do we have:
Let's list them down:
1. Depend on children for handout. Is this possible, just ask yourself.
2. Invest in private funds: With greedy investment bankers who caused a lot of havoc in the financial market nowadays, investment in funds to secure our nest egg is no longer safe; even foolhardy.
3. Do your own investment. Not many people can do that; if it is so simple, everyone will be rich.
4. Run your own business. Again, how many can successfully run a business that can afford him to retire in comfort?
So for ordinary folks, middle income families looking at securing their own retirement, their HDB flat is the best vet.
5 CMs, increase GLS, increase BTO, increase EC, increase income ceiling, control HDB valuation, still don't think govt ever had the intention to quell the prices,:doh:
Can give suggestion what else do you think the govt can do?
KenobaiWan is not going to crash the prices......too much political implications
phantom_opera
23-08-12, 09:29
KenobaiWan is not going to crash the prices......too much political implications
Is he a Jedi or a Sith?
ikan bilis
23-08-12, 09:37
Is he a Jedi or a Sith?
i heard he switched camp after the S$8 heart operation....
phantom_opera
23-08-12, 09:40
i heard he switched camp after the S$8 heart operation....
:scared-1: :luke-and-darth:
ikan bilis
23-08-12, 09:58
I see 2 groups of people benefiting from the gain:
1. Downgraders: Couple whose children have flown the nest and they want to downgrade to a smaller HDB flat.
2. Upgraders: Middle income who can sell their HDB flat, top up with savings and loan, and get a private condo.
Other than that, the gain is only on paper as you still need a roof over your head.
3. investors: those holding hdb as investment property, stay in condo and milking high yield rental income from hdb... resale price up rental will also be up eventually....
4. exploit-er/abuser: those squeezing whole family into parents' hdb (or moving parents into own hdb), renting out the vacant hdb for extra pocket $$, with or without fulfilling hdb-mop...
( disclaimer: any similarity purely coincidental)
:D :D
phantom_opera
23-08-12, 10:33
3. investors: those holding hdb as investment property, stay in condo and milking high yield rental income from hdb... resale price up rental will also be up eventually....
4. exploit-er/abuser: those squeezing whole family into parents' hdb (or moving parents into own hdb), renting out the vacant hdb for extra pocket $$, with or without fulfilling hdb-mop...
( disclaimer: any similarity purely coincidental)
:D :D
The ultimate, rent out HDB(s) in Singapore, stay in JB cheap cheap 150k landed
i heard he switched camp after the S$8 heart operation....
never switched camps, just a well-disguised Sith parading as a Jedi. oh wait.....could be a mind trick.....
Regulators
23-08-12, 11:57
those measures are to control supply n quell unhealthy speculation, not to reduce prices. As I have mentioned, their intention is for pty prices to appreciate, but at a pace they are comfortable. Gls only serves to jack up new launch prices further n they have still not stopped PRs from buying hdb, have you wondered why?
5 CMs, increase GLS, increase BTO, increase EC, increase income ceiling, control HDB valuation, still don't think govt ever had the intention to quell the prices,:doh:
Can give suggestion what else do you think the govt can do?
So for ordinary folks, middle income families looking at securing their own retirement, their HDB flat is the best vet.
these days there is another option. the 3xx-5xxk MMs! :D
phantom_opera
23-08-12, 12:20
these days there is another option. the 3xx-5xxk MMs! :D
One Dusun Residences ... ultimate SOHO for family :p
One Dusun Residences ... ultimate SOHO for family :p
No wonder so popular! :scared-3:
Opposition parties are populists ... no credible economic talents.. otherwise they should have just bombarded MAS policy of super low interest rate .... don't they know super low interest rate and tight labor market is a recipe for high inflation?
Back to HDB issue, if you allow singles below 35 to buy BTO, how about Singapore man who married foreigner?? I know many cannot apply for BTO because spouse cannot get SPR :mad:
spouse cannot get PR simply means spouse cannot even meet the already low PR criteria, want to blame who? lol
phantom_opera
23-08-12, 13:39
spouse cannot get PR simply means spouse cannot even meet the already low PR criteria, want to blame who? lol
Now MOM/ICA very high class ... EP minimum 3k for young people, slightly older 3.3k also cannot get EP
This will fuel wage inflation big time trust me :scared-4:
Now MOM/ICA very high class ... EP minimum 3k for young people, slightly older 3.3k also cannot get EP
This will fuel wage inflation big time trust me :scared-4:
oh how sad...now foreigners cannot find work so easily...:cheers1:
oh how sad...now foreigners cannot find work so easily...:cheers1:
Sorry, what is wage inflation :confused:
Still happy when lesser foreigners to snatch our jobs away :cheers4:
Allthepies
25-08-12, 16:43
Sorry, what is wage inflation :confused:
Still happy when lesser foreigners to snatch our jobs away :cheers4:
Nothing to happy about, we r currently facing shortage of workers, if the person cannot find jobs mean something wrong with tat person.
Either companies gg to raise the pay to hire these foreigners which lead to wage inflation and consumers will kena or companies will just close shop or shift out.
those measures are to control supply n quell unhealthy speculation, not to reduce prices. As I have mentioned, their intention is for pty prices to appreciate, but at a pace they are comfortable. Gls only serves to jack up new launch prices further n they have still not stopped PRs from buying hdb, have you wondered why?
Let me guess,
1. They cannot let them buy BTO because then they don't have to convert to Singapore citizen.
2. HDB resale very cheap.
3. They cannot build HDB fast enough.
4. They need foreign currency.
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