View Full Version : Is low interest rate the key to asset bubble?
The "lost decade" of Japan from 1990 to 2000 and extend to now (2 decade) was the result of low interest rate and high inflation during the 80s'such that the Japanese central bank feared the economy was becoming unstainable.The central bank began to increase interest rate to cool its economy but it came too late. The nation woke up to realize that corporates were highly geared and consumers were highly leverage in real estate. The bubble bursted and Japan still has not recovered today despite the central bank pumping in money (printing money) and with low interest rate.
The US was facing the same situation as Japan in 2008 when the bubble bursted.The fear of a lost decade for US is not unthinkable. Fed has maintained near zero interest rate and pumping money into its economy hoping to boost spendings by corporations and consumers but without much success due to multiple problems facing both the US and the world.
The Fed has said that it could raise interest rates anytime when sign of a recovery and should act forcefully to prevent another bubble should the low interest rate and higher inflation are allowed to prolong.
The vulnerable economies right now are not US and Europe or even Japan.These new vulnerable economies are Singapore, Hong Kong; China and other high growth, high inflation economies in Asia.
We are fortunate that MAS has been taking preemptive actions to prevent a bubble with various cooling measures to discourage corporations and consumers from highly leveraged particularly in real estate.
Question we need to ask is can MAS alone prevents an asset bubble? Economists have differing views with regards to Japan's "lost decade"and the US subprime crisis. Some believe it was due to weak monetary policies while others believe it was due to economic cycle largely at play. Both have their points.
Bubble usually starts by the rich (top 20%) and filled up by the 80%. The bubble starts to burst also usually by the rich and burst by the other 80%. Interest rate only serve as a catalyst but the bubble usually starts to burst when the 20% feel that the economy is not sustainable and start to move their funds or take profits. This exodus effect will cause the 80% to act and the bubble will burst.
The moral of this economic lesson is that we should invest with our EYES and not with our MIND. If one is highly leverage, make sure you have plan B.Interest rate in "theory" is just a catalyst. The thing that causesthe burst is the exodus effects when corporations and consumers start to be cautious just like the Japanese did.
Well! with this, I wish everyone well.
phantom_opera
15-11-12, 10:48
AUD high rate also bubble what ...:p
If Bank can loan me money, I will still buy.
The moral of this economic lesson is that we should invest with our EYES and not with our MIND. If one is highly leverage, make sure you have plan B.Interest rate in "theory" is just a catalyst. The thing that causesthe burst is the exodus effects when corporations and consumers start to be cautious just like the Japanese did.
Thank you Leeds for this good analysis cum warning reminder !
with low interest till 2015 and prob extension to 2016, along with QE3 and prob extended operation twist, many will continue to leverage still, in spite of the cooling measures. it is good to make sure that there is always a backup plan along with good holding power, cos the end of the ride may be extremely bumpy when that 20% get off. our cooling measures will then turn out to be the cushions we need afterall for that softer landing.
auroraborealis
15-11-12, 12:21
Bank can always lend u at LTV 60% or lower; asset based lending :scared-2:
If Bank can loan me money, I will still buy.
But my eyes are hungry, my mind says NO. Anyone else has this dilemma?
when bubble bursts, the rich are still rich while the poor lose their monies...honeys...and jobs.
But my eyes are hungry, my mind says NO. Anyone else has this dilemma?
what do you mean by that?
can you explain?
Bank can always lend u at LTV 60% or lower; asset based lending :scared-2:
Serious, and how long is the repayment period.
For me, it means putting my last dollar on the next property and hope for the best :ashamed1:
For me, it means putting my last dollar on the next property and hope for the best :ashamed1:
you got good cashflow to support?
Doable if i have risk appetite like Arcachon's. This forum has taught me alot and opened up new perspective on growing money through leveraging although I sensed I am abit late with all this CMs in place.
Doable if i have risk appetite like Arcachon's. This forum has taught me alot and opened up new perspective on growing money through leveraging although I sensed I am abit late with all this CMs in place.
don't over stretch..
enjoy life is more important :cheers5:
That's what my mind tells me too :cheers4:
Fully agree, buy what you can afford.
I use to wonder, how can a person buy million dollar property? I did my calculation and still can't find the answer until June 2006. It is not how much you earn a month, how much you keep aside a month, it's how you use others money to grow yours.
Until 2011, I thought I am using money others person deposit in the bank for the loan until I watch the you-tube about What is Banking.
Money is created when a person go to the Bank to borrow.
http://www.youtube.com/watch?feature=player_embedded&v=on513ZiQA8M
Money is Debt.
http://www.youtube.com/watch?v=lsmbWBpnCNk
Once you understand about Banking and Money than getting the million dollar property is easy.
Any Banker what to loan me money I will take.
Thanks Arcachon for this link. I will watch it later tonight.
But my eyes are hungry, my mind says NO. Anyone else has this dilemma?
There are 2 schools of thoughts... i have friends who have a couple of properties and you can say they are highly leveraged. So far all's been so good... as prices has been going up. No one knows what will happen to these fellows when the prices come down :D
Another group who dun touch properties at all; says they got emotions to houses, can't bear to sell even when prices are high :banghead: they put their money in the stock markets instead.
At the end of the day, dun follow the herd... follow the head :cheers4:
There are 2 schools of thoughts... i have friends who have a couple of properties and you can say they are highly leveraged. So far all's been so good... as prices has been going up. No one knows what will happen to these fellows when the prices come down :D
Another group who dun touch properties at all; says they got emotions to houses, can't bear to sell even when prices are high :banghead: they put their money in the stock markets instead.
At the end of the day, dun follow the herd... follow the head :cheers4:
lol~
me put in the bank now :(
:doh::doh:
ikan bilis
15-11-12, 14:42
Doable if i have risk appetite like Arcachon's. This forum has taught me alot and opened up new perspective on growing money through leveraging although I sensed I am abit late with all this CMs in place.
better don't anyhow follow... arcachon got a very solid iron bowl.... umm.... i think is steel type... :D :cheers4:
lol~
me put in the bank now :(
:doh::doh:
Now put $$ in the bank is same as putting under the pillow :p
lol~
me put in the bank now :(
:doh::doh:
Yeah, I miss those days where I can just leave my savings in the bank and still be smiling:(
better don't anyhow follow... arcachon got a very solid iron bowl.... umm.... i think is steel type... :D :cheers4:
As good as solid gold :D
There are 2 schools of thoughts...
At the end of the day, dun follow the herd... follow the head :cheers4:
Follow the head of the herd, but I must grow taller first :ashamed1:
There are 2 schools of thoughts... i have friends who have a couple of properties and you can say they are highly leveraged. So far all's been so good... as prices has been going up. No one knows what will happen to these fellows when the prices come down :D
Another group who dun touch properties at all; says they got emotions to houses, can't bear to sell even when prices are high :banghead: they put their money in the stock markets instead.
At the end of the day, dun follow the herd... follow the head :cheers4:
Bro, your friends who have a couple of condos can mitigate the risk by selling 1 of the condo and cashing out.... With this spare cash, he can put in the bank or pay up the some of the other housing loan bringing his leverage down. It all depends on ones play... The result will only be known at a later date. :cheers4:
Hi All
Lets say if u have the initial 40%, would you buy now at this current price and current economic situation?
Bro, your friends who have a couple of condos can mitigate the risk by selling 1 of the condo and cashing out.... With this spare cash, he can put in the bank or pay up the some of the other housing loan bringing his leverage down. It all depends on ones play... The result will only be known at a later date. :cheers4:
Actually there's no right or wrong... For me, I did the other way round. I bought one with very very little leverage. If I've done it like my friends, i would have been owner of at least 3 PCs :doh: But I prefer to sleep at ease in the night :o OR perhaps I'm too conservative
Whether who turns out to be right is the million-dollar question =. On hind-sight its always easy to say :cheers4:
Actually there's no right or wrong... For me, I did the other way round. I bought one with very very little leverage. If I've done it like my friends, i would have been owner of at least 3 PCs :doh: But I prefer to sleep at ease in the night :o OR perhaps I'm too conservative
Whether who turns out to be right is the million-dollar question =. On hind-sight its always easy to say :cheers4:
about your risk appetite..
the more greed, the more $$ u will get..
:D
Actually there's no right or wrong... For me, I did the other way round. I bought one with very very little leverage. If I've done it like my friends, i would have been owner of at least 3 PCs :doh: But I prefer to sleep at ease in the night :o OR perhaps I'm too conservative
Whether who turns out to be right is the million-dollar question =. On hind-sight its always easy to say :cheers4:
Bro, if u had followed your friends, u now can sell 1 of your condo and sleep peacefully leh. Because your sold unit could have possibly paid for most of the 2 units.
You are rite, no right or wrong. Many say, look on hindsight, should have known better. I have a better suggestion. Look on hindsight and learn. So u know what to do in the future. There will be some similarities in the future. Though not 100%. So when it dips, u know what to do. I hope u got what I mean.
Cheers. At least u slept well and still sleeping well.
:cheers4:
about your risk appetite..
the more greed, the more $$ u will get..
:D
How right you are... be greedy when everyone is scared :scared-4:
Bro, if u had followed your friends, u now can sell 1 of your condo and sleep peacefully leh. Because your sold unit could have possibly paid for most of the 2 units.
You are rite, no right or wrong. Many say, look on hindsight, should have known better. I have a better suggestion. Look on hindsight and learn. So u know what to do in the future. There will be some similarities in the future. Though not 100%. So when it dips, u know what to do. I hope u got what I mean.
Cheers. At least u slept well and still sleeping well.
:cheers4:
Thanks for the pointer bro. I've learnt my lesson well. Waiting for a dip until neck long long :doh: Hope to learn from you :cheers4:
Thanks for the pointer bro. I've learnt my lesson well. Waiting for a dip until neck long long :doh: Hope to learn from you :cheers4:
Bro, don't learn from me... Learn from the lesson.... So when the next dip come, evaluate. During dip, minimal risk when u have cash. U had so much cash when it was low, rite. When it is low, how much lower can it get? Already in 2006, it is a 40% discount from peak... The risk of dropping is low... Look at today, when it has gone up, risk higher, rite...
So play when minimal risk. But u need cash. If not u cannot sleep.... So do your sums now and evaluate constantly.. So when it comes, u are prepared and dont Karang kabot...
:cheers4:
One valuable lesson I learnt, which I firmly believe in is
HISTORY IS NOT GOING TO REPEAT ITSELF
if u think the past can guide u to wait for the dip, it is going to be difficult.
Even when the dip comes, u would wait for the price to go lower. But how low is the low, no one knows.
And once u miss the lows, u will find it very difficult to buy even it is 1% higher.
There were many good stuffs were gone for good.
phantom_opera
16-11-12, 10:08
To the threadstarter, just look at how Japan opposition Shinzo Abe motivated the market by talking about "unlimited easing" and "3% inflation target"
Yesterday Nikkei was the only stock market up in this region
Today:
Tokyo stocks up 1.88% by break
The money market is fruadery and causing movement of money to economies other than the intended. One needs to understand the dynamic of economics to appreciate the harm that it will bring.
Let us pray that the next two years, the economies in the US and Europe can recover or we will all be dead ducks. A prolong environment with low interest rate and high inflation is not sustainable.
When MAS is worried we should get the hint. Invest with your EYES and not with your MIND is the safer bet in this trying time.
phantom_opera
16-11-12, 10:58
The game is not as simple as:
A - recession
B - inflation
there is a 3rd option, 0.5% growth for next 10y for US/Europe, 2% for Singapore
Amber Woods
16-11-12, 11:09
Hi All
Lets say if u have the initial 40%, would you buy now at this current price and current economic situation?
It is very difficult for any responsible person to answer your question. As what someone else pointed out in this thread; if you buy now and can sleep well, go ahead. If not stay away.
Hope this helps!
auroraborealis
16-11-12, 11:19
yay support 3rd option n add
SG inflation 3-5% cause SGD strong range below 1.25
SG property price up 5% each year
SG STI remain ard 3000+/-
only my :2cents: reason y not into stocks now, cos mayb 5yrs later STI still at 3000 (no opportunity cost if dun buy now) but property different
The game is not as simple as:
A - recession
B - inflation
there is a 3rd option, 0.5% growth for next 10y for US/Europe, 2% for Singapore
phantom_opera
16-11-12, 11:22
yay support 3rd option n add
SG inflation 3-5% cause SGD strong range below 1.25
SG property price up 5% each year
SG STI remain ard 3000+/-
only my :2cents: reason y not into stocks now, cos mayb 5yrs later STI still at 3000 (no opportunity cost if dun buy now) but property different
just to add .... STI has dividend yield of 3% ... of course not very attractive if after 5y still at 3,000
this option is getting more likely by the day ... and looks like next massive printing may come from Japan - this Japan Shinzo Abe shouting "unlimited easing" and "3% inflation" :tongue3:
black swan to trigger outright deflation will probably be a war :p
The money market is fruadery and causing movement of money to economies other than the intended. One needs to understand the dynamic of economics to appreciate the harm that it will bring.
Let us pray that the next two years, the economies in the US and Europe can recover or we will all be dead ducks. A prolong environment with low interest rate and high inflation is not sustainable.
When MAS is worried we should get the hint. Invest with your EYES and not with your MIND is the safer bet in this trying time.
The ironery is that should the economies in the US and Europe recover in the next two years, interest rate would go up that could trigger the catalyst to ignite. We are kind of in a catch 22 situation.
We just need to be careful.
phantom_opera
16-11-12, 11:33
The ironery is that should the economies in the US and Europe recover in the next two years, interest rate would go up that could trigger the catalyst to ignite. We are kind of in a catch 22 situation.
We just need to be careful.
if economy confirmed recovering to 2-3% GDP in the US/Europe, they will not tighten so fast one, end up CCR will chiong and widen its gap with OCR :cheers6:
the chance of an outright recession / depression is very slim and central banks of the world are on ultra-easing tone
The ironery is that should the economies in the US and Europe recover in the next two years, interest rate would go up that could trigger the catalyst to ignite. We are kind of in a catch 22 situation.
We just need to be careful.
indeed, i have been thinking about this catch 22 situation.
the mitigating factor is that with economies booming, sentiments will improve, stock mkt will cheong, industries will be manufacturing at full speed. when that happens, interest rate up will be mitigated by all these feel good factor.
inflation will also set in (crude oil up, commodities up) when boom time. so ppty will appear to be cheap by then.
indeed, i have been thinking about this catch 22 situation.
the mitigating factor is that with economies booming, sentiments will improve, stock mkt will cheong, industries will be manufacturing at full speed. when that happens, interest rate up will be mitigated by all these feel good factor.
inflation will also set in (crude oil up, commodities up) when boom time. so ppty will appear to be cheap by then.
Interesting discussions!
The ironery is that Europe and the US by their current state are not ready to climb within the next 2 years. Most economists think they need much longer.
Should they start to recover, the flow of funds back to the west and the increase in interest rate will have serious implications to the highly geared and inflationery economies like ours. As global investors, they would take profits and invest in cheaper assets with more growth potential.
Just my thoughts!
Interesting discussions!
The ironery is that Europe and the US by their current state are not ready to climb within the next 2 years. Most economists think they need much longer.
Should they start to recover, the flow of funds back to the west and the increase in interest rate will have serious implications to the highly geared and inflationery economies like ours. As global investors, they would take profits and invest in cheaper assets with more growth potential.
Just my thoughts!
that is true. in all likelihood, the worse the economy, the better for sgp becoz funds flow here to safe haven. when things pick up, funds outflow. the angmos go home. etc etc..
anyway, everything points to 2015/6 as a critical year. low interest rates expire, huge housing supplies come on board. even election also in 2016.
that is true. in all likelihood, the worse the economy, the better for sgp becoz funds flow here to safe haven. when things pick up, funds outflow. the angmos go home. etc etc..
anyway, everything points to 2015/6 as a critical year. low interest rates expire, huge housing supplies come on board. even election also in 2016.
I like your take.
However, the longer it takes for the west to recover, the slower will be our economy to the extend of entering into a recession since the world still depends on the west for consumption.
It is really a catch 22 situation.
auroraborealis
16-11-12, 12:41
US anything is possible at least for current generation; silicon valley was discovered "overnight", so was Lehman crisis
EU I'm not so optimistic, they took 10yrs to settle monetary union n EUR thingy
another 10yrs to discover it's flawed
will prob take another 10yrs to sort out banking & fiscal union
when that's done, they'll prob power up the world
but until then, mayb just muddling along with GE support
the bloc is basically balance n self sufficient but rich subsidizing poor
Interesting discussions!
The ironery is that Europe and the US by their current state are not ready to climb within the next 2 years. Most economists think they need much longer.
Should they start to recover, the flow of funds back to the west and the increase in interest rate will have serious implications to the highly geared and inflationery economies like ours. As global investors, they would take profits and invest in cheaper assets with more growth potential.
Just my thoughts!
I like your take.
However, the longer it takes for the west to recover, the slower will be our economy to the extend of entering into a recession since the world still depends on the west for consumption.
It is really a catch 22 situation.
thanks.. you have a very great analysis of the situation too.
yes, either way, we are F-ked.
so how? buy or dun buy?
The fundamental difference is the value between the East and the West.
The West, more of party human, spend the earning of futures in today...
The East, work day and nite, and save every cent...
thanks.. you have a very great analysis of the situation too.
yes, either way, we are F-ked.
so how? buy or dun buy?
I think for the pros, the decision to buy or sell is not difficult. They look at cash flow. For the average investor, it is much more difficult. They often look at yield and capital gain so decision is more difficult and often get caught by the market.
I think for the pros, the decision to buy or sell is not difficult. They look at cash flow. For the average investor, it is much more difficult. They often look at yield and capital gain so decision is more difficult and often get caught by the market.
don't agree... although decision point may be different, variables are the same. even for pros, when mkt falls, cashflow gets hit. i know of cases in 2007 when rental tanked by >50%. so, it is always back to how much buffer you have. comfort zone in my view is always 50% LTV with some spare cash for buffer for low rent or no rent period.
don't agree... although decision point may be different, variables are the same. even for pros, when mkt falls, cashflow gets hit. i know of cases in 2007 when rental tanked by >50%. so, it is always back to how much buffer you have. comfort zone in my view is always 50% LTV with some spare cash for buffer for low rent or no rent period.
No worries!
For pros, they buy low (buy resale with immediate yield), sell high (when target met), take profit and enter market again when is conducive.
For the average, they often buy high (buy new or late stage), hope to sell higher (TOP) and hope for profit.
No worries!
For pros, they buy low (buy resale with immediate yield), sell high (when target met), take profit and enter market again when is conducive.
For the average, they often buy high (buy new or late stage), hope to sell higher (TOP) and hope for profit.
agree. interestingly, i have taken position in pro (buy resale for immediate yield), but took profit and went into average (buy new). but buying for own stay now, rent out HDB. bad investment decision, but good for the heart.
would you choose investment decision as the topmost priority (ie: forever stay in HDB) and collect PC rental, or is a nice house that you like a bigger priority?
agree. interestingly, i have taken position in pro (buy resale for immediate yield), but took profit and went into average (buy new). but buying for own stay now, rent out HDB. bad investment decision, but good for the heart.
would you choose investment decision as the topmost priority (ie: forever stay in HDB) and collect PC rental, or is a nice house that you like a bigger priority?
When one is young, better to choose investment and live modestly. By the time you are older, you should be able to live in a bigger house and still have your investments growing.
Somehow, it is difficult to try to live modestly in todays' competitive world especially when your "value" is measured by where you live, which school you came from and what car you drive
For me, if I am over 45, I'd choose to enjoy my PC first. If I am under 45, I'd delay gratification and live in Hdb :ashamed1:
When one is young, better to choose investment and live modestly. By the time you are older, you should be able to live in a bigger house and still have your investments growing.
Somehow, it is difficult to try to live modestly in todays' competitive world especially when your "value" is measured by where you live, which school you came from and what car you drive
well said. :o
Few years back I was active in buying properties. I was an optimist then... Still I couldn't believe the rate of increase of property prices today. Even I could afford daily expense, still I couldn't believe they increase so much.
When I though I was having a home run, I was merely had a narrow escape. I had imagine all the gains and passive incomes would be a significant boost in quality of live. The truth is I just maintaining.
Few years back I was active in buying properties. I was an optimist then... Still I couldn't believe the rate of increase of property prices today. Even I could afford daily expense, still I couldn't believe they increase so much.
When I though I was having a home run, I was merely had a narrow escape. I had imagine all the gains and passive incomes would be a significant boost in quality of live. The truth is I just maintaining.
Bro, sorry, I really catch no ball?:confused: :confused:
If u had not a few, u were maintaining??? You already beat like crazy... That's why I say I catch no ball?
:o
Bro, sorry, I really catch no ball?:confused: :confused:
If u had not a few, u were maintaining??? You already beat like crazy... That's why I say I catch no ball?
:o
I was hoping to be able to retire young, but I still need my day job to keep up with inflation. My children now grown.... They probably need their own place, so the properties will goes to them one day. So all the achievements of today will probably be tomorrow necessity.
I was hoping to be able to retire young, but I still need my day job to keep up with inflation. My children now grown.... They probably need their own place, so the properties will goes to them one day. So all the achievements of today will probably be tomorrow necessity.
Bro, only give your props only when the last surviving spouse kick e bucket. When alive, derive income from it lah....
If children want their props, help w downpayment lah... They can buy hdb wat. Then when u pass on. U can pass them the props wat....
:D :D
Oops, I read Somemore, I try to understand... U are saying, at the end, the property can only provide u the same lifestyle u have today? Is it?
If yes, I say already great already.
Assuming say your pay 10k and. Can derive 10k from rental, bro, this is super good already....
When one is young, better to choose investment and live modestly. By the time you are older, you should be able to live in a bigger house and still have your investments growing.
Somehow, it is difficult to try to live modestly in todays' competitive world especially when your "value" is measured by where you live, which school you came from and what car you drive
quite agree. question is what age is old and what age is young?
fortunately i don't hang around with pple who look at what house or what car i drive. those pressures are not the reason for me to get a better house or car. if fact, i am challenging myself to drive my current 5-yr car to the 10-yr mark.
frankly from all perspectives, living in HDB makes more sense. renting out the more expensive ppty is better from tax planning perspective.
sometimes, it is really difficult to choose between the heart and the mind.
quite agree. question is what age is old and what age is young?
fortunately i don't hang around with pple who look at what house or what car i drive. those pressures are not the reason for me to get a better house or car. if fact, i am challenging myself to drive my current 5-yr car to the 10-yr mark.
frankly from all perspectives, living in HDB makes more sense. renting out the more expensive ppty is better from tax planning perspective.
sometimes, it is really difficult to choose between the heart and the mind.
good post.
:o
Low interest rate AND money supply expansion causes assets bubbles. And there is no geographical restriction on where the bubbles may show up.
better don't anyhow follow... arcachon got a very solid iron bowl.... umm.... i think is steel type... :D :cheers4:
May I know what kind of rice bowl? sori me a little slow in following.
If you need to go for two years theory training, two years on the job training, qualify as License Aircraft Engineer, train by Italian contractor, US Army and work for 28 years and get paid $44,000 a year. The rice bowl should be made of gold.
If you need to go for two years theory training, two years on the job training, qualify as License Aircraft Engineer, train by Italian contractor, US Army and work for 28 years and get paid $44,000 a year. The rice bowl should be made of gold.
Cool. With RSAF or SIA?
It's amazing how you made use of leverage to your advantage! With income of less than $44K in 2006, how you manage to persuade UOB to loan you $428,000 to buy SB? I presume 30-year loan when you were 42 that year. So monthly installment come out to about $1800-2000 (estimate) assuming interest at around 4% in 2006 period, which is a huge chunk of your income! Did you still have any outstanding loan for your 5-rm HDB at that time??? How you get UOB to loan you the $???
Btw how come your income at $44K with 28 years. Assuming 1 year salary increment is $100 (average), 28 years increment would be $2800. Add 3 months bonus. And the total annual would be $42K already. Doesn't even include the starting salary. You got no increment for many years or you got no bonus?
Great to learn experience from 前辈们in this forum.:)
If you need to go for two years theory training, two years on the job training, qualify as License Aircraft Engineer, train by Italian contractor, US Army and work for 28 years and get paid $44,000 a year. The rice bowl should be made of gold.
wah bro!
you really got gold balls. :o
wah bro!
you really got gold balls. :o
I think SAF gives generous overseas allowance and contract maturity lump sum. Plus rental income, actual net income should be much much higher.
I think SAF gives generous overseas allowance and contract maturity lump sum. Plus rental income, actual net income should be much much higher.
SAF use to pay well, but not now because the retirement age change from 50 to 60 now.
In 2005 yearly income is 60k plus a bit and with my wife income I get a 2 Bedroom at Southbank in June 2006.
In 2007 my wife stop working and follow me to France and my yearly income went for free fall.
Overseas allowance known as Cost of Oversea Living Allowance COLA is enough for you for your 3 meal, if 3 meal eat at McDonald then you need to top-up.
Housing allowance is only good for basic housing, House with garden and garage you need to top-up also.
Rental income is enough for you to repair your house after you have rent out a number of years.
After years oversea, wife become true blue housewife.
Cool. With RSAF or SIA?
It's amazing how you made use of leverage to your advantage! With income of less than $44K in 2006, how you manage to persuade UOB to loan you $428,000 to buy SB? I presume 30-year loan when you were 42 that year. So monthly installment come out to about $1800-2000 (estimate) assuming interest at around 4% in 2006 period, which is a huge chunk of your income! Did you still have any outstanding loan for your 5-rm HDB at that time??? How you get UOB to loan you the $???
Btw how come your income at $44K with 28 years. Assuming 1 year salary increment is $100 (average), 28 years increment would be $2800. Add 3 months bonus. And the total annual would be $42K already. Doesn't even include the starting salary. You got no increment for many years or you got no bonus?
Great to learn experience from 前辈们in this forum.:)
The Bank loan me 28 years using my wife age, which is 5 years younger. Monthly mortgage about 1700 for 428000.
Yearly income about 60K for mine plus wife income.
HDB outstanding loan about 100K.
Last monthly salary is about 4.1k.
Starting salary with the other pocket is too low to mention.
Working for a monthly salary need to stop some where or reduce, else at retirement when the salary stop the money tap start to leak instead of filling the basin.
SAF use to pay well, but not now because the retirement age change from 50 to 60 now.
In 2005 yearly income is 60k plus a bit and with my wife income I get a 2 Bedroom at Southbank in June 2006.
In 2007 my wife stop working and follow me to France and my yearly income went for free fall.
Overseas allowance known as Cost of Oversea Living Allowance COLA is enough for you for your 3 meal, if 3 meal eat at McDonald then you need to top-up.
Housing allowance is only good for basic housing, House with garden and garage you need to top-up also.
Rental income is enough for you to repair your house after you have rent out a number of years.
After years oversea, wife become true blue housewife.
Tot you have kids to support also. Are they also in France?
bro, how's life in france?
any big difference in term of weather, air , people, food & surrounding?
The Bank loan me 28 years using my wife age, which is 5 years younger. Monthly mortgage about 1700 for 428000.
Yearly income about 60K for mine plus wife income.
HDB outstanding loan about 100K.
Last monthly salary is about 4.1k.
Starting salary with the other pocket is too low to mention.
Working for a monthly salary need to stop some where or reduce, else at retirement when the salary stop the money tap start to leak instead of filling the basin.
lots of discipline. hats off to you. bet you are doing much much better than most of your (equivalent) colleagues
Tot you have kids to support also. Are they also in France?
One wife, one kid, parent, one in-law, one 2 Bedroom, one 5 Room, and one 3 bedroom PH coming soon to support.
bro, how's life in france?
any big difference in term of weather, air , people, food & surrounding?
Weather is getting cold, lots of rain, daylight shorter, leaf falling.
Air is fresh all year round, pine tree burning smell start to get stronger.
Boring and expense food compare to US.
Lot of new housing, still don't understand why anyone here in France chose to buy instead of rent. Price of house the same for the last 5 years.
lots of discipline. hats off to you. bet you are doing much much better than most of your (equivalent) colleagues
Still remember my colleagues ask me why I did not buy a car after returning from US, I told them I am a poor man with lot of mouth to feed. 5 years later invited my colleagues to my 2 Bedroom, my colleagues ask me why I did not share the good buy with them, I ask them will they hold their cash to buy an apartment instead of buying a car, they remain silent.
One wife, one kid, parent, one in-law, one 2 Bedroom, one 5 Room, and one 3 bedroom PH coming soon to support.
:scared-4:
Better take good care of yourself also...
:scared-4:
Better take good care of yourself also...
Try to eat less nowadays, no OT unless necessary.
Still remember my colleagues ask me why I did not buy a car after returning from US, I told them I am a poor man with lot of mouth to feed. 5 years later invited my colleagues to my 2 Bedroom, my colleagues ask me why I did not share the good buy with them, I ask them will they hold their cash to buy an apartment instead of buying a car, they remain silent.
respect!
still alot to learn from you guys.
sometimes, it just need someone/something to trigger the thought. if someone had triggered my thought in 2007, i already buying my 3rd unit now. :banghead: :banghead: :banghead: but then, still buying stocks, thinking houses beyond my reach. now that i think back, actually i could have afforded a small 2BR (by today's standard, considered very big leow)
do you think.. if 5 yrs ago, you mentioned this to someone, that someone might have benefitted? no right or wrong answer. just thinking. me, for one, would indeed forego a car purchase to buy a house, becoz i am fully aware of the time value of money.
The Bank loan me 28 years using my wife age, which is 5 years younger. Monthly mortgage about 1700 for 428000.
Yearly income about 60K for mine plus wife income.
HDB outstanding loan about 100K.
Last monthly salary is about 4.1k.
Starting salary with the other pocket is too low to mention.
Working for a monthly salary need to stop some where or reduce, else at retirement when the salary stop the money tap start to leak instead of filling the basin.
Is your son and parent staying in the 5-rm HDB or you currently rent out also? You also planning to rent out your Terasse in future? How many total apartments you renting out in total including HDB? How much is your total rent now beside SB $4200?
Of all new launches in 2006, what make you choose SB? Pure luck or you know something for it? How do you know whether SB undervalued or not at that time?
Trying to understand your way of thinking may help me in future when I commit to buying.;)
Is your son and parent staying in the 5-rm HDB or you currently rent out also? You also planning to rent out your Terasse in future? How many total apartments you renting out in total including HDB? How much is your total rent now beside SB $4200?
Of all new launches in 2006, what make you choose SB? Pure luck or you know something for it? How do you know whether SB undervalued or not at that time?
Trying to understand your way of thinking may help me in future when I commit to buying.;)
Parent housing sad story.
Still thinking of what to do next.
Wet market and food-court the main consideration, near water, not among the building, staying at French Road rental apartment in the 80's and 90's.
thx for sharing your story..
really eye opening :o
quite agree. question is what age is old and what age is young?
fortunately i don't hang around with pple who look at what house or what car i drive. those pressures are not the reason for me to get a better house or car. if fact, i am challenging myself to drive my current 5-yr car to the 10-yr mark.
frankly from all perspectives, living in HDB makes more sense. renting out the more expensive ppty is better from tax planning perspective.
sometimes, it is really difficult to choose between the heart and the mind.
Most of the time we need to solved the financial problem our self. So no need worry so much about what other people think about our financial decision. Each person have their own luck. We just need to being honest with ours.
http://forums.condosingapore.com/showthread.php?t=18321
We are fortunate that MAS has been taking preemptive actions to prevent a bubble with various cooling measures to discourage corporations and consumers from highly leveraged particularly in real estate.
[SIZE=3][COLOR=#000000][FONT=Times New Roman]Question we need to ask is can MAS alone prevents an asset bubble?
a very insightful article indeed :)
wrt yr qn above, I highly doubt so. Future increase in population & high buying sentiment is the main obstacles to the success of CMs here. look at HK n China. their ppty prices had increased more significantly than ours. hv their market crash?
Do not underestimate the increasing number of middle class in china.
a very insightful article indeed :)
wrt yr qn above, I highly doubt so. Future increase in population & high buying sentiment is the main obstacles to the success of CMs here. look at HK n China. their ppty prices had increased more significantly than ours. hv their market crash?
Do not underestimate the increasing number of middle class in china.
I did not.
in fact this huge wave of investors from china is a 2 edged sword; when they inject funds into spore, our ppty market prosperous. but should they leave one day, spore ppty mkt will oso crash.
I did not.
in fact this huge wave of investors from china is a 2 edged sword; when they inject funds into spore, our ppty market prosperous. but should they leave one day, spore ppty mkt will oso crash.
If they leave, where can they go.
http://www.straitstimes.com/breaking-news/singapore/story/more-rich-people-singapore-2015-study-20120926
If they leave, where can they go.
http://www.straitstimes.com/breaking-news/singapore/story/more-rich-people-singapore-2015-study-20120926
another market which hv been suppressed for long/higher potential for growth.
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