View Full Version : Should we sell?
Need some advise from property investors here.
Currently me and my wife have 3 properties in Singapore and 2 properties are currently rent out to expat tenant on corporate lease which will run till 2016. rental yield based on purchased price from 5 and 2 years ago is around 6% and 4.8% respectively and our outstanding mortgage for both properties is around 50% based on current valuation price. For our 3rd properties, that's for own stay and we do not intend to sell.
So the question on our mind now is
a) Should we sell our investment properties, cash out and reinvest in future?
b) Should we keep both property to enjoy regular rental income stream?
Concern for (a) is the cost of replacement will be very high due to cooling measures and we might not be able to find a replacement properties which we like as much as the one we have right now. So we might end up having millions "rotting" in the bank away
Concern for (b) is that we will not get to enjoy the feeling of being cash rich in our life time or we might missed to catch the property cycle.
So the question now is, should we sell or do nothing, or is there other options?
Need some advise from property investors here.
Currently me and my wife have 3 properties in Singapore and 2 properties are currently rent out to expat tenant on corporate lease which will run till 2016. rental yield based on purchased price from 5 and 2 years ago is around 6% and 4.8% respectively and our outstanding mortgage for both properties is around 50% based on current valuation price. For our 3rd properties, that's for own stay and we do not intend to sell.
So the question on our mind now is
a) Should we sell our investment properties, cash out and reinvest in future?
b) Should we keep both property to enjoy regular rental income stream?
Concern for (a) is the cost of replacement will be very high due to cooling measures and we might not be able to find a replacement properties which we like as much as the one we have right now. So we might end up having millions "rotting" in the bank away
Concern for (b) is that we will not get to enjoy the feeling of being cash rich in our life time or we might missed to catch the property cycle.
So the question now is, should we sell or do nothing, or is there other options?
The long term fundamentals for Singapore as a country remains sound, and hence property prices will always remain strong in the long run.
If you do not have an urgent requirement to raise cash, you should not worry about your investments. Any actions you undertake to try to capitalise on the temporary distortions in the marketplace, you will end up being less well off.
It sounds like you are happy with your current property types and locations, so my suggestion is not to let the 'noise' distort your conviction in using property as an asset class to build long term wealth in Singapore.
Real estate agents, fellow investors, bankers and those who do not have properties to their names all have separate kinds of advice for you. Whose would you like to hear?
Need some advise from property investors here.
Currently me and my wife have 3 properties in Singapore and 2 properties are currently rent out to expat tenant on corporate lease which will run till 2016. rental yield based on purchased price from 5 and 2 years ago is around 6% and 4.8% respectively and our outstanding mortgage for both properties is around 50% based on current valuation price. For our 3rd properties, that's for own stay and we do not intend to sell.
So the question on our mind now is
a) Should we sell our investment properties, cash out and reinvest in future?
b) Should we keep both property to enjoy regular rental income stream?
Concern for (a) is the cost of replacement will be very high due to cooling measures and we might not be able to find a replacement properties which we like as much as the one we have right now. So we might end up having millions "rotting" in the bank away
Concern for (b) is that we will not get to enjoy the feeling of being cash rich in our life time or we might missed to catch the property cycle.
So the question now is, should we sell or do nothing, or is there other options?
Londonproperty123
26-04-14, 10:18
Cash out, before the market comes tumbling down............
Allthepies
26-04-14, 11:01
If u sell one of the investment properties and the profit can cover the other cost price fully, I think u should consider to sell one...
Then in this case u have 1 fully paid up property tat is "free" and a huge amount of cash....
Never totally cash out... Buy smaller units
Never totally cash out... Buy smaller units
My friend just bought a small unit in Robertson quay, I think price is $1.5m, rental is about $4k... I notice other units in the same development selling below his price now... At $4k, I think cannot cover mortgage even at this low interest.. If interests goes up, I don't know also what to say...
Seriously it is about timing, but who can tell? If we know, we won't be here...
Londonproperty123
26-04-14, 11:55
Yah, if we knew for sure we would be super rich. No need to work. It is all about taking risks and bearing the consequence of the risk.
My friend just bought a small unit in Robertson quay, I think price is $1.5m, rental is about $4k... I notice other units in the same development selling below his price now... At $4k, I think cannot cover mortgage even at this low interest.. If interests goes up, I don't know also what to say...
Seriously it is about timing, but who can tell? If we know, we won't be here...
That's how I felt for the first 2 properties I own. After many more I own.... Now I don't look at it that way. If risk doesn't kill me, it works for me.
Are investment units in great location in terms of rental with good pool of expats? Consideration should also be made based on your age, household income, security of income, etc.
Need some advise from property investors here.
Currently me and my wife have 3 properties in Singapore and 2 properties are currently rent out to expat tenant on corporate lease which will run till 2016. rental yield based on purchased price from 5 and 2 years ago is around 6% and 4.8% respectively and our outstanding mortgage for both properties is around 50% based on current valuation price. For our 3rd properties, that's for own stay and we do not intend to sell.
So the question on our mind now is
a) Should we sell our investment properties, cash out and reinvest in future?
b) Should we keep both property to enjoy regular rental income stream?
Concern for (a) is the cost of replacement will be very high due to cooling measures and we might not be able to find a replacement properties which we like as much as the one we have right now. So we might end up having millions "rotting" in the bank away
Concern for (b) is that we will not get to enjoy the feeling of being cash rich in our life time or we might missed to catch the property cycle.
So the question now is, should we sell or do nothing, or is there other options?
with 3 properties, not fullly paid, u got to gauge whether ur sampan is too heavy. no current still ok, but if strong current come how? can tahan?
u look at the stars urself,
if clear blue sky, u contine to saill,
if see storm coming, den u better offload and dock faster.
if not sure, u might want to lighten ur load a little bit if the sampan is carrying too much stuff... just in case..
but of course, if your star reading skill sucks n made the wrong decision....den too bad.... :D:D
Never totally cash out... Buy smaller units
We already have a beautiful decent size 1 bedder unit which we are getting very decent yield at the moment and we even think about retiring there when our kids grow up. Plan is subject to change of course.
Concern of cashing out of course is to have the money rotting away.
with 3 properties, not fullly paid, u got to gauge whether ur sampan is too heavy. no current still ok, but if strong current come how? can tahan?
u look at the stars urself,
if clear blue sky, u contine to saill,
if see storm coming, den u better offload and dock faster.
if not sure, u might want to lighten ur load a little bit if the sampan is carrying too much stuff... just in case..
but of course, if your star reading skill sucks n made the wrong decision....den too bad.... :D:D
We are not too concern as both me and my wife are still working and at the moment we dont even need to pay any cash or CPF service our mortgages.
As long as interest rate remain low, it will still reward those who leverage. And thats actually the reason why I am afraid of cashing out because for future purchase, we will have to pay bigger down payment and monthly payment. So from cash flow point of view, its not so ideal.
We are not too concern as both me and my wife are still working and at the moment we dont even need to pay any cash or CPF service our mortgages.
As long as interest rate remain low, it will still reward those who leverage. And thats actually the reason why I am afraid of cashing out because for future purchase, we will have to pay bigger down payment and monthly payment. So from cash flow point of view, its not so ideal.
Then u should consider buyer another unit since u have strong holding power and cash rixh😆😆
Need some advise from property investors here.
Currently me and my wife have 3 properties in Singapore and 2 properties are currently rent out to expat tenant on corporate lease which will run till 2016. rental yield based on purchased price from 5 and 2 years ago is around 6% and 4.8% respectively and our outstanding mortgage for both properties is around 50% based on current valuation price. For our 3rd properties, that's for own stay and we do not intend to sell.
So the question on our mind now is
a) Should we sell our investment properties, cash out and reinvest in future?
b) Should we keep both property to enjoy regular rental income stream?
Concern for (a) is the cost of replacement will be very high due to cooling measures and we might not be able to find a replacement properties which we like as much as the one we have right now. So we might end up having millions "rotting" in the bank away
Concern for (b) is that we will not get to enjoy the feeling of being cash rich in our life time or we might missed to catch the property cycle.
So the question now is, should we sell or do nothing, or is there other options?
if your current pty are somehow very undesirable or problematic, then consider sell and switch to something better.
if not, look to add a fourth one. :D
if u want to know the meaning of REGRET then sell:o
Londonproperty123
26-04-14, 17:12
Today, ST published an article on falling prices. Also, we went to check out some condos today.
Personally, if I were in your position, I would cash out now before the prices drop further.
I have blogged more here.
http://londonproperty123.blogspot.sg...ming-down.html
How much will it drop and how long for since your advice is to sell now?
Today, ST published an article on falling prices. Also, we went to check out some condos today.
Personally, if I were in your position, I would cash out now before the prices drop further.
I have blogged more here.
http://londonproperty123.blogspot.sg...ming-down.html
Currently me and my wife have 3 properties in Singapore and 2 properties are currently rent out to expat tenant on corporate lease which will run till 2016. rental yield based on purchased price from 5 and 2 years ago is around 6% and 4.8% respectively and our outstanding mortgage for both properties is around 50% based on current valuation price. For our 3rd properties, that's for own stay and we do not intend to sell.
If I will you, which I am not.
What is the chances of property drop 50%?
Is the world still printing money?
How long can you pay the mortgage if both are not rented out (cash on hand)?
How much % on current valuation is the own stay?
After selling is there a better ROI for the cash?
Do you think money in the Bank is better than having loan from the Bank?
If you can answer the question you should have answer to your question.
will some suggest sell then use the money to buy bond or not ? :D
http://forums.condosingapore.com/showthread.php?t=15297
Londonproperty123
26-04-14, 17:25
How much will it drop and how long for since your advice is to sell now?
If I knew the answer to your questions, I'd be a tycoon by now.
I am just reading all the data and making a prediction, aka crystal gazing.
Looking at the graph, looking at the market sentiment, looking at what Government is doing, my take is that the market will come down by 15 to 20% over the next couple of years.
if your current pty are somehow very undesirable or problematic, then consider sell and switch to something better.
if not, look to add a fourth one. :D
They are very good units with good facing and layout, thats why it can command higher than average rental.
We are contented with having 3 properties in Singapore and with ABSD and lower LTV ratio, it just doesnt make any sense to buy now. So 4th for us is not something we will consider in the near future
If I will you, which I am not.
What is the chances of property drop 50%?
Is the world still printing money?
How long can you pay the mortgage if both are not rented out (cash on hand)?
How much % on current valuation is the own stay?
After selling is there a better ROI for the cash?
Do you think money in the Bank is better than having loan from the Bank?
If you can answer the question you should have answer to your question.
Having loan from the back is having better return compare to money in the bank is you collection rent from property.
Like what you have just said that we will be filthy rich if we know the future. What if existing properties giving rental income of 5% and passive income. Should one sell them? :)
If I knew the answer to your questions, I'd be a tycoon by now.
I am just reading all the data and making a prediction, aka crystal gazing.
Looking at the graph, looking at the market sentiment, looking at what Government is doing, my take is that the market will come down by 15 to 20% over the next couple of years.
Today, ST published an article on falling prices. Also, we went to check out some condos today.
Personally, if I were in your position, I would cash out now before the prices drop further.
I have blogged more here.
http://londonproperty123.blogspot.sg...ming-down.html
When we bought our properties our intention is hold it for long term because we could possibly see ourselves using them in future, either to stay or use it as a source of passive income for retirement
The decision to sell is a easy one, the more difficult question is what to do with the money after you cash out. Some might say put the money in other form of investments, which we already have btw, but we still think brick and mortal assets like properties is still worth holding, especially if you are Singaporeans.
So, what would you do with the money after you cash out?
They are very good units with good facing and layout, thats why it can command higher than average rental.
We are contented with having 3 properties in Singapore and with ABSD and lower LTV ratio, it just doesnt make any sense to buy now. So 4th for us is not something we will consider in the near future
Care to share which are the properties that u have rented out? Maybe we can advise if they are worth keeping. :D
Londonproperty123
26-04-14, 17:59
When we bought our properties our intention is hold it for long term because we could possibly see ourselves using them in future, either to stay or use it as a source of passive income for retirement
The decision to sell is a easy one, the more difficult question is what to do with the money after you cash out. Some might say put the money in other form of investments, which we already have btw, but we still think brick and mortal assets like properties is still worth holding, especially if you are Singaporeans.
So, what would you do with the money after you cash out?
Hold on to the money in cash or near cash.
Wait for the property prices to come down then invest again.
Hold on to the money in cash or near cash.
Wait for the property prices to come down then invest again.
Hi bro London
I only scared prices come down not much and chiong again, no major economic crisis and job loss...Now seriously...people like got lots of cash... just came from tiong bahru...so many hip cafe mushrooming...quite crowded leh. Very painful if sell and then cannot buy
Maybe status quo may not be a bad idea after all. If crash, then buy one more.
I also not sure.:scared-5::scared-5:
Londonproperty123
26-04-14, 18:16
Hi bro London
I only scared prices come down not much and chiong again, no major economic crisis and job loss...Now seriously...people like got lots of cash... just came from tiong bahru...so many hip cafe mushrooming...quite crowded leh. Very painful if sell and then cannot buy
Maybe status quo may not be a bad idea after all. If crash, then buy one more.
I also not sure.:scared-5::scared-5:
Yeah, I see your point.
Well, if we knew for sure, we'd be tycoons by now.
So, all the best!
Hold on to the money in cash or near cash.
Wait for the property prices to come down then invest again.
What you are suggesting is timing the property cycles, which in theory is a very logical move. However in real life, one will have to factor in many other factors such as cost of replacement, (e.g stamp duty, ABSD), and also your ability to replace good properties with even better properties at a lower price.
How much price correction do you think should happen before it make this exercise worth while?
Since you bought your properties few years back, they should both be in-the-money now, unless property crash, which is unlikely, at least the one you bot 6 years ago should not go into the red. So you are still not losing money, in fact, you are gaining the rent.
Since both are in good locations, price for such location may not drop too much (dont compare with Habitat which is super expensive in the first place). Tenant pool for such units should be better compare to ulu place, so if future supply of rental units increase, yours will not be in the frontline to get hit.
If interest goes up, since you are currently just using cpf to pay loan, at worse you will be using some of your pay/rental to help service, still no problem.
As you originally intended to hold for long term, price fluctuations should not play a big part in your decision.
If I am you, I will leave status quo ... Just my thoughts.
Wolverine23
26-04-14, 20:34
What you are suggesting is timing the property cycles, which in theory is a very logical move. However in real life, one will have to factor in many other factors such as cost of replacement, (e.g stamp duty, ABSD), and also your ability to replace good properties with even better properties at a lower price.
How much price correction do you think should happen before it make this exercise worth while?
Rental is real. Waiting for flash crash or flash rise is gambling / dream.
The longer the crash does not happen, the richer you get.
End of the day, is it worth it to switch and wait just for a few percent of gain if any?
Wolverine23
26-04-14, 20:36
They are very good units with good facing and layout, thats why it can command higher than average rental.
We are contented with having 3 properties in Singapore and with ABSD and lower LTV ratio, it just doesnt make any sense to buy now. So 4th for us is not something we will consider in the near future
Same here, I am out of residential ppty game with ABSD and LTV. Does not make sense to pay more (no level playing ground) and higher capital (lower ROE).
Have been buying commercial properties and suggest you also take a look.
But got to buy the right ones just like residential units. Have seen a lot of completed units still empty.
Same here, I am out of residential ppty game with ABSD and LTV. Does not make sense to pay more (no level playing ground) and higher capital (lower ROE).
Have been buying commercial properties and suggest you also take a look.
phantom_opera
26-04-14, 21:31
Singkies are used to putting all eggs in one basket :D
without more immigrants with low GDP growth ... 99LH at so so location will be very risky :scared-5:
of course, US Fed is unlikely to increase policy rate anytime soon .. otherwise a Blackswan will hit :banghead:
Rental is real. Waiting for flash crash or flash rise is gambling / dream.
The longer the crash does not happen, the richer you get.
End of the day, is it worth it to switch and wait just for a few percent of gain if any?
Thats exactly my thought. Good property is actually very hard to come by because they are like cash cow that generate cash while you are sleeping. Although you dont get the feeling of a windfall, but you do get a good night sleep because you know that your investments are working for you.
Having said that, I would still like to listen to other opinion because life is still all about learning.
In my personal opinion, it may be better to exit market. A lot of those gurus already sold off their on hand units....only keeping those with high yields...
No emotion from investment point of view. :2cents:
Thats exactly my thought. Good property is actually very hard to come by because they are like cash cow that generate cash while you are sleeping. Although you dont get the feeling of a windfall, but you do get a good night sleep because you know that your investments are working for you.
Having said that, I would still like to listen to other opinion because life is still all about learning.
In my personal opinion, it may be better to exit market. A lot of those gurus already sold off their on hand units....only keeping those with high yields...
No emotion from investment point of view. :2cents:
Based on my purchase price, my rental yield is averaging around 5%, not sure if its good or bad to the gurus.
However I am really interested to know what are the gurus plan after they cash out. that to me is the most difficult decision to make for property investors.
I think u alr answered yourself la
I think u alr answered yourself la
i always believe there are more than one approach to investment, and you can never be too sure that your approach is the best one. Thats why I am humbly trying to learn from others.
what you said about good property is very true. when you enter a house for the first time the feeling you are after is to feel overwhelms by the natural energy within the house. That to me is really hard to find.
just buy and keep if got money :D
Make it a point to acquire 1 property per year at least and paid off a property in 3 years. :D
just buy and keep if got money :D
Make it a point to acquire 1 property per year at least and paid off a property in 3 years. :D
eventually you will come to a point where money is just a number and you will realize that happiness is not all about money, its about have a peace of mind and a good night sleep
Wolverine23
26-04-14, 23:52
But got to buy the right ones just like residential units. Have seen a lot of completed units still empty.
I seldom buy projects under construction. :)
eventually you will come to a point where money is just a number and you will realize that happiness is not all about money, its about have a peace of mind and a good night sleep
than just sell, keep the plentiful cash (which i assume can last you till you go) and park in fixed deposits. Sure can sleep in peace at night. No need to worry market go up or down. Rental up or down, interest rates up or down etc also no need to worry. :D
Wolverine23
26-04-14, 23:56
just buy and keep if got money :D
Make it a point to acquire 1 property per year at least and paid off a property in 3 years. :D
Bro Kellogs is cash-powered... :)
Buy conservation shophouses as art collection?
than just sell, keep the plentiful cash (which i assume can last you till you go) and park in fixed deposits. Sure can sleep in peace at night. No need to worry market go up or down. Rental up or down, interest rates up or down etc also no need to worry. :D
fd is not my cup of tea because I always believe that my bank is using my money to make more money
fd is not my cup of tea because I always believe that my bank is using my money to make more money
How does your bank use your money to make more money???
Sell and buy land. Be a developer yourself. Then you dont have this headache of sell or not sell. From what I read, i dont think you got the guts. So just keep them and be happy
will some suggest sell then use the money to buy bond or not ? :D
http://forums.condosingapore.com/showthread.php?t=15297
no......................
Based on my purchase price, my rental yield is averaging around 5%, not sure if its good or bad to the gurus.
However I am really interested to know what are the gurus plan after they cash out. that to me is the most difficult decision to make for property investors. depends how old are you lor, if past 60s will be spend the $ to enjoy, travelling and enjoy life....if 50s, can still punt the stock market, if 40s, can still wait for a good project and enjoy investing, ..... Many of us facing the same problems la
thomastansb
27-04-14, 11:29
I am renting them out for long term.
Your example is almost the same as my case.
All my loans are about 50% of today's valuation because I bought them before the price spike. Just take my unit at citylights for eg - I am paying the bank 1.7k. Rental is 4.2k. Every month, I saved up the money and I feel really rich in this way. Even if I don't see 800,000 or 1M in my account, I can see the account going up by a lot a month. It is good enough for me.
Need some advise from property investors here.
Currently me and my wife have 3 properties in Singapore and 2 properties are currently rent out to expat tenant on corporate lease which will run till 2016. rental yield based on purchased price from 5 and 2 years ago is around 6% and 4.8% respectively and our outstanding mortgage for both properties is around 50% based on current valuation price. For our 3rd properties, that's for own stay and we do not intend to sell.
So the question on our mind now is
a) Should we sell our investment properties, cash out and reinvest in future?
b) Should we keep both property to enjoy regular rental income stream?
Concern for (a) is the cost of replacement will be very high due to cooling measures and we might not be able to find a replacement properties which we like as much as the one we have right now. So we might end up having millions "rotting" in the bank away
Concern for (b) is that we will not get to enjoy the feeling of being cash rich in our life time or we might missed to catch the property cycle.
So the question now is, should we sell or do nothing, or is there other options?
fd is not my cup of tea because I always believe that my bank is using my money to make more money
Welcome to the New World, Bank do not need your deposit to give loan. MAS decided whether they can loan or not.
In 2006, your need to pay 5% and loan upon TOP (DPS).
-----------------------------------------------------------
PLAYING the deferred payment card can help private housing developers boost the take-up rates for their new launches, say property consultants.
Recent industry figures show a clear trend in favour of deferred payment projects because - all other factors being equal - buyers are attracted by the lower cash downpayments.
Most projects launched since the beginning of last month which offered deferred payment schemes have seen more than half of the units sold, figures provided by property consultancy Colliers Jardine show.
In fact, of 10 new launches offering deferred payment, an impressive eight have already seen their take-up rates climb above the 50 per cent mark.
The top three projects were notable successes, achieving 100 per cent sales.
Buyers understandably leap at the chance to pay just 10 per cent deposit up front, instead of the usual 20 per cent, with the other 10 per cent payable several years down the road when the temporary occupation permit (TOP) is issued.
Inevitably, other factors such as location, pricing and the competition on offer also affect take-up rates - so deferred payment does not guarantee success to a developer.
Take for example the smash sell-out of MCL Land's The Warren condominium development in Choa Chu Kang, last year's top-selling private housing project. All 699 units in the development were snapped up in just three weeks, at an average price of $450 per sq ft (psf).
Keppel Land's 53-unit freehold The Edgewater at Jalan Loyang Besar was also sold out at $460 psf on average. And other developments such as Trussville, Golden Heights and the Ansley have all achieved take-up rates at or near 100 per cent.
"I think if you look at comparable properties in the same price range, those with a deferred payment scheme have a lot better take-up rate," said Mr Peter Ow, executive director (residential) for property consultancy Knight Frank.
He cited the example of the MCL Land-Ho Bee joint venture Rio Vista, which was relaunched recently with the deferred payment incentive, with no change in its average price of $450 psf.
Some 290 units had been sold since the 99-year leasehold, 716-unit project was first launched last July without a deferred payment scheme.
Since then, Mr Ow noted, "the take up has been fairly good ... it has been more than 150 units since we relaunched with a deferred payment scheme".
In contrast, of seven new launches which did not offer deferred payment, only three had managed to achieve take-up rates of 50 percent or better.
Still, an appealing project will do well even without deferred payment, such as the case of Wing Tai Holdings' The Serenade @ Holland.
Some 76 units or about 85 per cent of the 89-unit, 99-year leasehold condominium at 371 Holland Road have already been snapped up.
Market watchers say Wing Tai may be set to repeat this success with its 81-unit Newton 18 freehold apartment project in District 11, which will be launched officially this weekend.
A total of 39 units will be released for sale at an average price of $1,000 psf, and some 24 units have already been taken up even before the official launch.
Again, Wing Tai is not offering deferred payment.
Observers have noted that the two projects are located in quite attractive districts - Newton 18, for example, is a hop, skip and jump away from the Orchard Road shopping belt - which may account for the strong demand.
However, other developments such as Adam Park, which did not offer deferred payment, have not yet hit the 50 per cent mark.
Market-watchers say it is likely to be the smaller developers which are unable to offer deferred payment, since they may not have the cash to sustain the construction costs until TOP.
In the end, however, while the deferred payment option "eases the financial burden and allows one to stagger the payment, it by no means is going to keep away buyers once they have decided to buy a property", said Colliers Jardine associate director for research Priyadarshini Sengupta.
Meanwhile, Knight Frank said yesterday that OUB Centre is launching its first residential project for this year, Malvern Springs in Katong, today.
It, too, does not offer deferred payment. Prices start at $615,000 for a two-bedroom apartment.
http://www.stproperty.sg/articles-property/financial-guide/deferred-payment-a-key-plus-point/a/60700
[SINGAPORE] Private home purchases fell across the board in the first three months of this year to just over 2,000 units - the first time in more than five years that the number has dropped below 3,000 homes. However, foreigners' share of transactions edged up because of a sharper pullback by Singaporean buyers.
Singaporeans' share - at 70 per cent - is at its lowest since the introduction of the additional buyer's stamp duty (ABSD) in Q4 2011. In absolute terms, purchases by permanent residents (PRs) and foreign buyers were also at their lowest levels since the Q1 2009 market trough during the global financial crisis.
Based on DTZ's caveats analysis of URA Realis data as at April 15, Singaporean buyers accounted for 70 per cent of the 2,076 private homes that changed hands in Q1 this year, down from the 73 per cent share in both Q4 and Q1 last year.
PRs saw their share increase to a record 19 per cent - the highest level since Q1 1995, the earliest date that the URA Realis caveats database goes back to - from 16 per cent in Q4 2013 and 17 per cent in Q1 2013.
Market watchers linked the rise to the rule change in late-August 2013 requiring new PRs to wait three years before they can buy an HDB resale flat, prompting those who need immediate accommodation to turn to the private housing market.
Foreigners' share too has been creeping back up, touching 10 per cent for the first quarter. Although this is still low compared to the pre-ABSD proportion of 19 per cent, this was higher than the 9 per cent in Q4 2013.
DTZ South-east Asia chief operating officer Ong Choon Fah said that given the high home ownership rate among Singaporeans, "there is no real push factor for them to buy right now".
"They can afford to time the market. With signs now that the market is softening, more Singaporeans are taking a wait-and-see attitude."
Lee Lay Keng, DTZ's regional head (SEA) research, noted that the combination of the ABSD measures and last June's total debt servicing ratio (TDSR) framework had led to a sharper pullback in buying activity by Singaporeans in the first quarter amid expectations that prices could fall further given that the government has said it is not yet time to remove any cooling measures.
Despite the slowly rising share of foreign buying, market watchers are not expecting the authorities to come up with fresh cooling measures given the weaker property market sentiment.
Ms Lee said while the 42 and 47 per cent quarter-on-quarter declines in Q1 purchases by PRs and foreigners respectively were smaller than the 54 per cent slide in Singaporean purchases, the 401 units and 203 units that PRs and foreigners acquired here in January-March were at their lowest levels since Q1 2009. In that quarter, the figures were 325 and 175 units respectively.
The 1,453 private homes that Singaporeans bought in Q1 this year was the lowest since the 1,402 units in Q4 2008.
For all three groups, the number of units bought in Q1 was also down significantly from the year-ago period. In Q1 2013, Singaporeans, PRs and foreigners snapped up 4,494, 1,029 and 622 units respectively.
Giving a breakdown of the combined PR and foreign buying pool by nationalities, DTZ said that mainland Chinese, Malaysians, Indonesians and Indians continued to be the top four groups. Together, they accounted for 81 per cent of all private home purchases by non-Singaporean buyers, similar to Q4 2013.
Purchases by all four nationalities saw quarter-on-quarter declines, with Indonesians posting the biggest drop of 52 per cent to only 72 units in Q1. This was the first time since Q1 2009 that their purchases dipped below 100 units.
In all, 2,076 private homes were transacted in Q1, nearly half the 4,312 units in the previous quarter and one-third the Q1 2013 volume of 6,175 homes. The latest figure marks the first time the number has slipped below 3,000 units since Q4 2008, when 1,787 private home changed hands.
Century 21 Singapore CEO Ku Swee Yong is cautious about the outlook for private residential transactions for the rest of the year. "The general mood among real estate investors in most markets is just not there. For Singapore, I'm cautious till at least end-2014. If we see another three to four quarters of subdued transaction volumes and price declines, the Singapore authorities may lift some of the cooling measures. That could bring back buyers."
http://www.stproperty.sg/articles-property/financial-guide/foreigners-share-of-home-purchases-creeping-up/a/161716
Londonproperty123
27-04-14, 14:46
Yes, most are taking a wait and see attitude.
http://www.btinvest.com.sg/system/assets/20502/table1.png
Allow me to paint the other half of the household balance sheet picture (see Table 1). For the period under consideration, while total household debt grew by 41%, or $78 billion, total household assets grew by $420 billion (+33%) of which “Currency and Deposits” grew by $77 billion (+33%) and CPF funds grew by $70 billion (+41%). As for the residential segment, mortgages increased $57 billion (+40%) while the value of residential assets increased $229 billion (+38%). Asset value grew 4 times that of liabilities. Ask the accountants if this is healthy for household balance sheets.
http://www.btinvest.com.sg/blogs/2013/10/17/where-is-the-excessive-borrowing-pt-1/
The Monetary Authority of Singapore (MAS) sounded alarm bells about certain households over-stretching their finances and taking on high mortgages (me 44K). To curb the herd mentality in property investments and to instill further prudence in taking on mortgages, the MAS imposed further restrictions on property loans with the Total Debt Servicing Ratio (TDSR) framework.
Londonproperty123
27-04-14, 15:22
Rather than put in random thoughts, I have put up a new blog post and I give this issue my 2 cents worth.
My views only.
http://londonproperty123.blogspot.sg/2014/04/should-you-sell-now-singapore-property.html
walkthetiger
28-04-14, 19:33
Need some advise from property investors here.
Currently me and my wife have 3 properties in Singapore and 2 properties are currently rent out to expat tenant on corporate lease which will run till 2016. rental yield based on purchased price from 5 and 2 years ago is around 6% and 4.8% respectively and our outstanding mortgage for both properties is around 50% based on current valuation price. For our 3rd properties, that's for own stay and we do not intend to sell.
So the question on our mind now is
a) Should we sell our investment properties, cash out and reinvest in future?
b) Should we keep both property to enjoy regular rental income stream?
Concern for (a) is the cost of replacement will be very high due to cooling measures and we might not be able to find a replacement properties which we like as much as the one we have right now. So we might end up having millions "rotting" in the bank away
Concern for (b) is that we will not get to enjoy the feeling of being cash rich in our life time or we might missed to catch the property cycle.
So the question now is, should we sell or do nothing, or is there other options?
Seem like you are seeking information from this forum to decide...
If this is real, then think if you sell now, how much will you gain. Then, by looking at how much you understand about property to see if that gain is good enough for you ... If you think you should deserve/gain more from property, than continue to keep it to see if really grow so well in future.... good luck.
For me, I am just here to seek some fun to relax only, for the real solid information I need for analysis, usually don’t come easy, many times I have to pay for it, and still sometimes I will receive some bullshits for academic scholar. End of the day, trust your instinct, and learn for mistake.
Seem like you are seeking information from this forum to decide...
If this is real, then think if you sell now, how much will you gain. Then, by looking at how much you understand about property to see if that gain is good enough for you ... If you think you should deserve/gain more from property, than continue to keep it to see if really grow so well in future.... good luck.
For me, I am just here to seek some fun to relax only, for the real solid information I need for analysis, usually don’t come easy, many times I have to pay for it, and still sometimes I will receive some bullshits for academic scholar. End of the day, trust your instinct, and learn for mistake.
Hi Tiger
That's so true!:)
Thank you guys for the valuable input.
We reckon if we sell both our investment properties right now, we should be able to pocket around $1.8-$2.0m. In return we will have to forgo around $140k of rental income per year.
At the moment, our rental income is more than enough to pay for the mortgage payment for all 3 properties, without even using our CPF.
So if we sell, we could pay off our mortgage of our own stay property and still have around $1m of cash for investment. And if we reinvest to buy a $2m property with $1m loan, we could possibly get a positive income of around $3k per month at most, which is really not that great because by doing so, we will have to pay around $200,000 of stamp duties (3+7% ABSD) and other cost such as reno and agent commission etc
I am not sure if my calculation is correct, but assuming it is, then it doesnt really make much sense for us to cash out.
Londonproperty123
30-04-14, 15:28
Well, once you have decided, move on.
All the best!
Wolverine23
30-04-14, 20:23
Thank you guys for the valuable input.
We reckon if we sell both our investment properties right now, we should be able to pocket around $1.8-$2.0m. In return we will have to forgo around $140k of rental income per year.
At the moment, our rental income is more than enough to pay for the mortgage payment for all 3 properties, without even using our CPF.
So if we sell, we could pay off our mortgage of our own stay property and still have around $1m of cash for investment. And if we reinvest to buy a $2m property with $1m loan, we could possibly get a positive income of around $3k per month at most, which is really not that great because by doing so, we will have to pay around $200,000 of stamp duties (3+7% ABSD) and other cost such as reno and agent commission etc
I am not sure if my calculation is correct, but assuming it is, then it doesnt really make much sense for us to cash out.
Buy commercial!!!
Buy commercial!!!
I am not very familiar with commercial properties. From my observation, I do foresee retail, F&B sectors heading for headwind in the years ahead because of high rental overhead, lack of manpower, consolidation on the industry, as well as online shopping. And the success of commercial properties also depends a lot on location and anchor tenants.
Unless you can use it to make money, I think buying strata titled commercial property are only good for short to medium term. ie. hoping to flip to make money instead of holding
phantom_opera
30-04-14, 21:53
well u can buy a huge PUT option :p
I am not very familiar with commercial properties. From my observation, I do foresee retail, F&B sectors heading for headwind in the years ahead because of high rental overhead, lack of manpower, consolidation on the industry, as well as online shopping. And the success of commercial properties also depends a lot on location and anchor tenants.
Unless you can use it to make money, I think buying strata titled commercial property are only good for short to medium term. ie. hoping to flip to make money instead of holding
frankly now its time to put the $ in US. not so much Asia
invigorated
01-05-14, 01:08
Thank you guys for the valuable input.
We reckon if we sell both our investment properties right now, we should be able to pocket around $1.8-$2.0m. In return we will have to forgo around $140k of rental income per year.
At the moment, our rental income is more than enough to pay for the mortgage payment for all 3 properties, without even using our CPF.
So if we sell, we could pay off our mortgage of our own stay property and still have around $1m of cash for investment. And if we reinvest to buy a $2m property with $1m loan, we could possibly get a positive income of around $3k per month at most, which is really not that great because by doing so, we will have to pay around $200,000 of stamp duties (3+7% ABSD) and other cost such as reno and agent commission etc
I am not sure if my calculation is correct, but assuming it is, then it doesnt really make much sense for us to cash out.
Mho, the objective of cashing out has to be clear. Cash out if you feel that in the next year, prices will fall with the excess supply and you'll be able to pick up some durains. Perhaps that is what some of the rich like lks and warren are famous for doing.
If your objective is to sell now and buy now, the obvious answer is no with tdsr n absd. Just be resolute that if prices do fall 15-20%, you wouldn't regret it as u have made an informed choice based on your circumstances.
Good luck anyway!
Londonproperty123
01-05-14, 09:31
frankly now its time to put the $ in US. not so much Asia
Can you start a series of investing in the USA?
Don't know enough so dare not go in.
walkthetiger
01-05-14, 09:49
Perhaps that is what some of the rich like lks and warren are famous for doing.
They are just the 2 most famous iconic figures. Only 2 in the world know how to do it?.....there are much much more hidden predators in the sea..
frankly now its time to put the $ in US. not so much Asia
Like where and why?
Londonproperty123
01-05-14, 10:03
Check this out.
Sharp drop in new home loans. TDSR taking effect.
http://londonproperty123.blogspot.sg/2014/04/home-loans-brits-get-35x-income.html
Mho, the objective of cashing out has to be clear. Cash out if you feel that in the next year, prices will fall with the excess supply and you'll be able to pick up some durains. Perhaps that is what some of the rich like lks and warren are famous for doing.
If your objective is to sell now and buy now, the obvious answer is no with tdsr n absd. Just be resolute that if prices do fall 15-20%, you wouldn't regret it as u have made an informed choice based on your circumstances.
Good luck anyway!
What you are suggesting is actually a very dangerous and risky game of timing and predicting how the market will move.
Assuming my investment property is worth $4m today, if I sell, i get to cash out $2m, but at the expense of forgoing my rental income of say $140k per year.
So if price do fall by 20%, in 1 year, my $4m assets would then be worth $3.2m and for me to buy back the same property (assuming still available), I would need to fork out, $1.6m + $320K (ABSD + STAMP DUTIES) + MISC cost, that will work out to about $2.0m.
If I decided to do nothing, my asset could be worth $3.2m in 1 years time, but I still get to collect $140,000 of rental for 1 year. And assuming if 1 years time is the bottom of the cycle, it will also mean the value of my $3.2m property will also appreciate just a fast as if I sell and then buy back at $3.2m
Actually I always have the impression that Warren Buffet is an investor that buy good companies and hold for long term, instead of selling and buying between economic cycle.
Wolverine23
01-05-14, 11:14
Can you start a series of investing in the USA?
Don't know enough so dare not go in.
Just buy US stocks? Easier...
KO, MCD, GLW, DIS
Your statement below (highlighted is wrong):
"In a previous blog post, I said that TDSR was here to stay. Just in case people are wondering when Government will lift TDSR, my view is that it is very likely to be a permanent feature in our banking system. I had observed that even under TDSR requirements, credit is still very cheap and plentiful in Singapore compared to the UK. We can get more than 10X combined income in housing loans, while the British only get 3.5X. What gives?"
This is because you are taking before-tax income and not after-tax income and you don't consider long-term property loan interest rate (and hence instalment amount)!
After tax (something about 50%), the British has very much less money on hand to pay for property instalments etc, hence obviously their ratio must be lower!
Also, British long-term property loan rate is very much higher than Singapore!
Consider the above 2 factors, it is not that credit given in Singapore is higher! In fact, credit in Singapore may be lower than British (you can go calcuate to confirm)?
Check this out.
Sharp drop in new home loans. TDSR taking effect.
http://londonproperty123.blogspot.sg/2014/04/home-loans-brits-get-35x-income.html
Allthepies
01-05-14, 11:39
Isnt it now the best time to buy if you can detect the elevated amount of fear in singapore property market : )
1. FEAR of rising interest rate.
2. Fear of over supply.
3. Fear of reducing foreigners
4. Fear of cooling measures
People thought it is easy to time the market but in real life it is very difficult and the indications are very subtle and confusing...
invigorated
01-05-14, 12:11
What you are suggesting is actually a very dangerous and risky game of timing and predicting how the market will move.
Assuming my investment property is worth $4m today, if I sell, i get to cash out $2m, but at the expense of forgoing my rental income of say $140k per year.
So if price do fall by 20%, in 1 year, my $4m assets would then be worth $3.2m and for me to buy back the same property (assuming still available), I would need to fork out, $1.6m + $320K (ABSD + STAMP DUTIES) + MISC cost, that will work out to about $2.0m.
If I decided to do nothing, my asset could be worth $3.2m in 1 years time, but I still get to collect $140,000 of rental for 1 year. And assuming if 1 years time is the bottom of the cycle, it will also mean the value of my $3.2m property will also appreciate just a fast as if I sell and then buy back at $3.2m
Actually I always have the impression that Warren Buffet is an investor that buy good companies and hold for long term, instead of selling and buying between economic cycle.
You misunderstood my point. My point is that your objective must be clear.
From your reply, I'm not too sure if you were even considering selling in the first place or trying to imply that we shouldn't be selling our properties.
If I were to hold more than two properties, which I am not, I will seriously consider selling 1 or 2 to diversify my risks. If the market drops and CMs are eventually relaxed, e.g. absd or tdsr changes, I can pick up some good buys as I possess Firepower. Now if u keep all of them, you've basically locked all options.
You are also making a lot of assumptions here and it is still uncertain how things will map out. No one knows for sure what measures will be changed, how interest rates will go up and how rental will be affected, how much prices will fall or rise.
You may already be speculating by making assumptions on these and that may be dangerous by itself. Do map out other possible scenarios.
My 2 cents here. Rental had been a good option for the past 7-8 years. But consider that there had been a surge in expat population in the same period, the numbers of which are unlikely to recur. Expat growth has slowed down considerably and rental in CCR/RCR are increasingly difficult (talking from personal experience). Add to that significant supply of new housing units that will be added to the supply over the next few years in all CCR/RCR/OCR and you cannot expect the current rental yields to stay where they are.
So if rental yields have topped out, interest rates have bottomed out (and slowly creeping up), capital values have only one way to go......down. Besides, it is so difficult to sell a property these days. Not only you have to drop price, but also taking awfully lot of time to close deals.
Londonproperty123
01-05-14, 12:29
Your statement below (highlighted is wrong):
"In a previous blog post, I said that TDSR was here to stay. Just in case people are wondering when Government will lift TDSR, my view is that it is very likely to be a permanent feature in our banking system. I had observed that even under TDSR requirements, credit is still very cheap and plentiful in Singapore compared to the UK. We can get more than 10X combined income in housing loans, while the British only get 3.5X. What gives?"
This is because you are taking before-tax income and not after-tax income and you don't consider long-term property loan interest rate (and hence instalment amount)!
After tax (something about 50%), the British has very much less money on hand to pay for property instalments etc, hence obviously their ratio must be lower!
Also, British long-term property loan rate is very much higher than Singapore!
Consider the above 2 factors, it is not that credit given in Singapore is higher! In fact, credit in Singapore may be lower than British (you can go calcuate to confirm)?
First factor - Interest rates
You should be aware that in Singapore's TDSR calculations, the assumed interest rate is 3.5% and not the existing (artificially low) interest rates. I have loans with UK banks in pounds, and the interest rate I am getting on those is less than 3.5%.
Right now, Brits can get funding from their Building Societies with fixed interest rates for 2-3 years, fixed at less than 2%.
Therefore, rather than being wrong, your argument on interest rates actually helps rather than hurts my case.
Second factor - Post-tax Income
It is true that British Income taxes are high, but the cases I know of, the couple are not earning at the 50% rate. The Brits also have a progressive tax system, something like first 10K pounds no tax, next 30K pounds at 20%, then goes up to 40%.
The 3.5X people I am talking about are earning incomes of less than 60K per annum. Combined income about 100K to 120K per annum.
Yes, their after tax income is probably about 80K per annum.
Taking both factors into account, the gap between Singapore and Britain credit market is still very far apart. I stand by my statement that credit is far easier to get in Singapore, compared to Britain.
walkthetiger
01-05-14, 12:32
If I were to hold more than two properties, which I am not, I will seriously consider selling 1 or 2 to diversify my risks.
.
This is right. Be practical about it, diversify the risk if you are only trying to seek a gradual growth....move around, and explore other field, never try to get yourself stuck in an single area..
invigorated
01-05-14, 12:44
Isnt it now the best time to buy if you can detect the elevated amount of fear in singapore property market : )
1. FEAR of rising interest rate.
2. Fear of over supply.
3. Fear of reducing foreigners
4. Fear of cooling measures
People thought it is easy to time the market but in real life it is very difficult and the indications are very subtle and confusing...
We are just starting to see some fear in the developers, e.g. capitaland. Wait till u see fear from other developers like keppel for glades (<25% sold for glades), mcc (poor sales at Santorini) etc, will the time be ripe.
What are they to do if unit are not moving and others are cutting prices, you think?
I think market (already has) will drop but a crash????
Those saying it will crash, by at least how many % constitute a crash????
invigorated
01-05-14, 12:51
I think market (already has) will drop but a crash????
Those saying it will crash, by at least how many % constitute a crash????
I guess most agree a crash wouldn't happen as the foundation is there. But a further drop is likely. Only the Govt knows what percentage is a comfortable correction.
walkthetiger
01-05-14, 13:06
I guess most agree a crash wouldn't happen as the foundation is there. But a further drop is likely. Only the Govt knows what percentage is a comfortable correction.
Look at now, most (agents, developers, bankers, buyers and etc...) are in a deadlock, nothing is moving, most are suffering....and if the tension goes on higher and thing continue to get worsen.... a crash may appear a good solution to move forward... Don’t think this is totally impossible, it is just not yet happen as thing has just not yet progress to that stage only
Londonproperty123
01-05-14, 13:43
Look at the charts published by the URA - Residential Index by property type.
http://londonproperty123.blogspot.sg/2014/04/singapore-property-prices-coming-down.html
From 2002 to 2008, the index was hovering below 120. (4Q98 = 100)
So, why can't we go back to 120?
Look at the charts published by the URA - Residential Index by property type.
http://londonproperty123.blogspot.sg/2014/04/singapore-property-prices-coming-down.html
From 2002 to 2008, the index was hovering below 120. (4Q98 = 100)
So, why can't we go back to 120?
So u looking at 40% drop as crash...
Can you start a series of investing in the USA?
Don't know enough so dare not go in.
http://www.ovginvest.com/usa-property-investors-guide-ngps/
You can get something here.
http://www.zillow.com/homes/85718_rb/#%2Fhomes%2Ffor_sale%2FTucson-AZ-85718%2F95056_rid%2F32.342266%2C-110.909998%2C32.333817%2C-110.933644_rect%2F15_zm%2F0_mmm%2F=
https://www.youtube.com/watch?v=fC93DpIG1IA
Surely whether one should sell depends on the location of the properties.
If you are having a good property in CCR, DO NOT SELL at the bottom now. Price gap between CCR and RCR is at historic low. You will never be able to get a replacement in CCR.
If you are having a property somewhere in Jurong on the other hand... time to get out of the market.
Surely whether one should sell depends on the location of the properties.
If you are having a good property in CCR, DO NOT SELL at the bottom now. Price gap between CCR and RCR is at historic low. You will never be able to get a replacement in CCR.
If you are having a property somewhere in Jurong on the other hand... time to get out of the market.
:confused::confused::confused::confused:
Can share which development in CCR vs development in RCR?
When you compare new launch in CCR vs new launch in RCR??? Where got narrow gap????
When compare old with old??? Where got narrow gap???
It's like comparing the most expensive OCR withe the cheapest RCR and saying narrow gap.
Look at now, most (agents, developers, bankers, buyers and etc...) are in a deadlock, nothing is moving, most are suffering....and if the tension goes on higher and thing continue to get worsen.... a crash may appear a good solution to move forward... Don’t think this is totally impossible, it is just not yet happen as thing has just not yet progress to that stage only
Crash will not happen. 80% of the people I know are waiting to jump in... How to crash?
Don't think it will happen this round... We are only facing a technical pullback.. Once TDRS and ABSD are taken away, buyers will jump in like no tomorrow.
I am also waiting ... Seriously, don't think it will come.
:confused::confused::confused::confused:
Can share which development in CCR vs development in RCR?
When you compare new launch in CCR vs new launch in RCR??? Where got narrow gap????
When compare old with old??? Where got narrow gap???
It's like comparing the most expensive OCR withe the cheapest RCR and saying narrow gap.
I should have said price gap between CCR and OCR. Yes gap is narrow.
Look at appreciation rate of many average (10 years old) resale OCRs v average CCRs since 2005.
Wunderkind
01-05-14, 17:24
Crash will not happen. 80% of the people I know are waiting to jump in... How to crash?
Don't think it will happen this round... We are only facing a technical pullback.. Once TDRS and ABSD are taken away, buyers will jump in like no tomorrow.
I am also waiting ... Seriously, don't think it will come.
It is unlikely that the property market will crash unless it is triggered by an external event which the government has no control over.
Some moderation of price will happen as demand tapers due to lesser liquidity. But the market will not fall by more than 20% to 30% in the current economic environment. The government can still intervene to prop up the market if the market signals an over-correction.
invigorated
01-05-14, 18:11
It is unlikely that the property market will crash unless it is triggered by an external event which the government has no control over.
Some moderation of price will happen as demand tapers due to lesser liquidity. But the market will not fall by more than 20% to 30% in the current economic environment. The government can still intervene to prop up the market if the market signals an over-correction.
Agree with your viewpoint. Take the recent sky habitat for example. A price drop of 10-15% already lured a few more takers. If they drop another 10%, prob a good number will be snapped up. There is a certain threshold or demand-supply working here. Would I buy now? No. Would I buy if prices drop another 30%? Probably!
The govt knows this and it's letting nature take its course. Nothing for it to worry about. Its view is for the long haul anyway.
You misunderstood my point. My point is that your objective must be clear.
From your reply, I'm not too sure if you were even considering selling in the first place or trying to imply that we shouldn't be selling our properties.
If I were to hold more than two properties, which I am not, I will seriously consider selling 1 or 2 to diversify my risks. If the market drops and CMs are eventually relaxed, e.g. absd or tdsr changes, I can pick up some good buys as I possess Firepower. Now if u keep all of them, you've basically locked all options.
You are also making a lot of assumptions here and it is still uncertain how things will map out. No one knows for sure what measures will be changed, how interest rates will go up and how rental will be affected, how much prices will fall or rise.
You may already be speculating by making assumptions on these and that may be dangerous by itself. Do map out other possible scenarios.
There is very little assumption on my side actually. The scenarios I painted are actually based on what you said about price falling 20%. The only assumption I made is the 20% fall will happens in 1 year time. If its 2 years, then it could even be less favorable to cash out.
Personally I would not bet on government removing cooling measures and even if they do, it might no necessary benefit my situation, plus removing cooling measures will actually benefit existing investors more than would be buyer, as the latter will be able be to cash out during the upswing.
Juniper,
keep your properties. if you want to sell, sell the one with the lesser lease remaining, unless both are FH, then sell the one with less desirable location.
walkthetiger
01-05-14, 20:13
Crash will not happen. 80% of the people I know are waiting to jump in... How to crash?
Don't think it will happen this round... We are only facing a technical pullback.. Once TDRS and ABSD are taken away, buyers will jump in like no tomorrow.
I am also waiting ... Seriously, don't think it will come.
Agree, now indeed it still quite far to see it clearly happening.... the time is still not right..... all the worse has not yet fully arrive, now we are only beginning to see the worse coming slowly. This thing needs something to wipe out all the buying confidence to happen..
I worry the market turn into a long slow decline.... not a good thing either...nobody will gain from such market...If so, I rather see it crash....Hope all agree.
Agree, now indeed it still quite far to see it clearly happening.... the time is still not right..... all the worse has not yet fully arrive, now we are only beginning to see the worse coming slowly. This thing needs something to wipe out all the buying confidence to happen..
I worry the market turn into a long slow decline.... not a good thing either...nobody will gain from such market...If so, I rather see it crash....Hope all agree.
Long slow decline seems more likely than a crash. It looks like the government wants to wait for incomes to catch up with housing. But if you are an investor and have properties rented out (thus giving you >5% return on equity net of interest) then very little reason to sell unless properties are not in good location and difficult to find tenants.
Londonproperty123
01-05-14, 20:47
Some want more cooling measures.
http://www.todayonline.com/business/spore-buyers-call-more-property-curbs
Some want more cooling measures.
http://www.todayonline.com/business/spore-buyers-call-more-property-curbs
These people have their own agenda. Whoever asks for more cooling measures should declare whether they are prospective buyer or not. The fact that people are calling for more cooling measures means they are very interested to buy. Thus why sell to them cheap now if you have good units?
Some want more cooling measures.
Seller and buyer in equilibrium state. Govt collecting max revenue - price is exactly as planned. Why need to do anything more?
This could be the group who have sold their homes and renting now.
These people have their own agenda. Whoever asks for more cooling measures should declare whether they are prospective buyer or not. The fact that people are calling for more cooling measures means they are very interested to buy. Thus why sell to them cheap now if you have good units?
walkthetiger
01-05-14, 21:08
Long slow decline seems more likely than a crash. It looks like the government wants to wait for incomes to catch up with housing. But if you are an investor and have properties rented out (thus giving you >5% return on equity net of interest) then very little reason to sell unless properties are not in good location and difficult to find tenants.
Agree..it will go into a long slow decline, which is likely... then gov won the battle completely if so, there is nothing much we can do about it, unless big players want to sink the market but hard to see this happen in singapore too. So, in the end it will eventually goes back to some old days where nobody talk about property anymore...those older investors will know what I meant.
Unlikely for a place like Singapore with limited land, strong currency, stability, etc. :D
Agree..it will go into a long slow decline, which is likely... then gov won the battle completely if so, there is nothing much we can do about it, unless big players want to sink the market but hard to see this happen in singapore too. So, in the end it will eventually goes back to some old days where nobody talk about property anymore...those older investors will know what I meant.
walkthetiger
01-05-14, 21:24
Unlikely for a place like Singapore with limited land, strong currency, stability, etc. :D
....it is not so simple... think about what type of gov do you have first....good luck.
The surveys are conducted mostly for buyers, so obviously those want property prices to crash!
Imagine a nation of 90% property owners, you think 74% will want property prices to drop?! :p
These people have their own agenda. Whoever asks for more cooling measures should declare whether they are prospective buyer or not. The fact that people are calling for more cooling measures means they are very interested to buy. Thus why sell to them cheap now if you have good units?
This could be the group who have sold their homes and renting now.
Quite a number are doing this. I say good luck to them.
Just thinking aloud from a buyer's perspective...
One factor now is the SSD which means if you want to buy you need to hold for four years. Thus the issue is not just whether there will be a drop now... but what happens if you buy now and can only cash out after four years.
e.g. for a 2 m property:
A expects price to drop 10% or 200k. A waits and doesn't buy until it drops to 1.8m.
B expects price to stay flat. B buys now and rents it out for four years thus making 200k in rental (conservative assumption).
If A is wrong about price dropping 10%, then A doesn't buy in the next four years and loses 200k in rental income, and takes the risk that after four years the down-cycle is over and price shoots up.
If B is wrong about price staying flat, then B takes the risk over four years that prices crash >10%. However as long as prices doesn't crash >10%, B is still better off buying as his rental in four years covers any potential loss, and perhaps, by the time he wants to sell, the up-cycle begins.
Admittedly, this is a very simplistic example - but considering the above, do you think buyers are more desperate to buy, or sellers are more desperate to sell? :doh:
invigorated
02-05-14, 00:18
Just thinking aloud from a buyer's perspective...
One factor now is the SSD which means if you want to buy you need to hold for four years. Thus the issue is not just whether there will be a drop now... but what happens if you buy now and can only cash out after four years.
e.g. for a 2 m property:
A expects price to drop 10% or 200k. A waits and doesn't buy until it drops to 1.8m.
B expects price to stay flat. B buys now and rents it out for four years thus making 200k in rental (conservative assumption).
If A is wrong about price dropping 10%, then A doesn't buy in the next four years and loses 200k in rental income, and takes the risk that after four years the down-cycle is over and price shoots up.
If B is wrong about price staying flat, then B takes the risk over four years that prices crash >10%. However as long as prices doesn't crash >10%, B is still better off buying as his rental in four years covers any potential loss, and perhaps, by the time he wants to sell, the up-cycle begins.
Admittedly, this is a very simplistic example - but considering the above, do you think buyers are more desperate to buy, or sellers are more desperate to sell? :doh:
Not all buyers are out to buy and rent so it's tough to use this as the main profile, so as you have said, it may be very much simplistic. If one is buying for own stay, should one buy now then?
Would it be possible that the gain becomes less than 200k after considering other implications such as months without rental, income and property tax, interest rate rise and loss of interest from the downpayment (some banks are already offering higher interest rates for deposits)?
If the market falls more than 10%, which has happened to buyers of some recent units, then they may already be worse off. Sellers may be less desperate to sell in good areas near MRT with good yields.
But what about those that are unable to get rental due to the recent supply spike? Especially considering the impending surge in TOP units?
Wolverine23
02-05-14, 07:14
....it is not so simple... think about what type of gov do you have first....good luck.
So what is your view on our government and the likely development of real estate? Thanks.
Deputy Prime Minister and Minister for Finance Mr Tharman Shanmugaratnam said: “The reality we face is that interest rates are extraordinarily low, globally and in Singapore, and continue to add fuel to our property market. We have to take this further round of measures now, to check recent market trends and avoid a more serious correction in prices further down the road.”
Minister for National Development Mr Khaw Boon Wan said: “A large supply of public and private housing – up to 200,000 units in total – will be completed in the coming years. Coupled with the new measures, we will be better placed to ensure that housing remains affordable to Singaporeans.”
http://www.iras.gov.sg/irasHome/page03a.aspx?id=14342
GDP
http://www.todayonline.com/business/economists-slightly-trim-singapore-2014-gdp-forecasts-mas-survey
http://www.mas.gov.sg/~/media/MAS/Monetary%20Policy%20and%20Economics/The%20Singapore%20Economy/SPF/2013/Survey%20Writeup%20Dec2013.pdf
CPI
http://www.singstat.gov.sg/educational_corner/FAQ_on_CPI.html#8
Unemployment rate
http://stats.mom.gov.sg/Pages/Unemployment-Summary-Table.aspx
http://www.mom.gov.sg/newsroom/Pages/PressReleasesDetail.aspx?listid=549
On coming completed units
http://www.ura.gov.sg/uol/media-room/news/2014/apr/~/media/User%20Defined/URA%20Online/media-room/2014/apr/pr14-29e3.ashx
Real estate stats
http://www.ura.gov.sg/uol/media-room/news/2014/apr/pr14-29.aspx
Add in some more information to help you plan/decide on buying or selling
walkthetiger
02-05-14, 07:57
So what is your view on our government and the likely development of real estate? Thanks.
I cashed out recently, and i am not coming back so soon, as an investor i am only interested in money.....i see nothing here coming...... the rest u see it for yourself..good luck..
Singapore gov is too capable to give fair share to all the people evenly.... can be good and bad.....
walkthetiger
02-05-14, 08:18
The surveys are conducted mostly for buyers, so obviously those want property prices to crash!
Imagine a nation of 90% property owners, you think 74% will want property prices to drop?! :p
I wish it crashes, push the reset bottom, hope all see the big picture as it will be good for money making in long run, 良药苦口, the game will be in our hand again...but this will be challenging the gov ...gov control everything... pls factor that in....but if all people all want it to crash than different story of course, gov is concern of their vote in next GE, they don't appear very very confidence to me now...they are still trying to buy support... will give thousands of promise to people.
Look at DBSS, a good example of ideas that doesn't work.
If more CM to come it might even further back fire on financing on buyer just like the 30% MSR.
I wish it crashes, push the reset bottom, hope all see the big picture as it will be good for money making in long run, 良药苦口, the game will be in our hand again...but this will be challenging the gov ...gov control everything... pls factor that in....but if all people all want it to crash than different story of course, gov is concern of their vote in next GE, they don't appear very very confidence to me now...they are still trying to buy support... will give thousands of promise to people.
Everyone wished for different outcome based on their personal agenda. However if the housing prices crashed to 30 percent or more..or underwent a pronounced " reset", when that happens ever wonder what does it mean in general for Singapore. .?
It probably means singapore has significantly lost its competitive edge n that foreign investors find it no longer worth to invest in singapore anymore.
Or a sharp world wide recession has kicked in...n it means even longer recovery period.
Recession aside, is there any point to buy more property to invest since no one wants to buy? :beats-me-man:
If let's say the economy Singapore stops growing. ..population in general will drop since there will not be much FT. Unemployment rate will probably raise..n people might even move out of singapore in search of better job. There will mean a hell lot of empty properties doesnt it?
Of course it will be a different story if government purposely crash the prices.
However this will undermine the banks since a lot of people will be forced to top up the difference in their loan. Then a vicious cycle ensure...Wouldnt this undermind singapore banks in general? .:beats-me-man:
Would the goverment want to rock the boat so badly?
Everyone wished for different outcome based on their personal agenda. However if the housing prices crashed to 30 percent or more..or underwent a pronounced " reset", when that happens ever wonder what does it mean in general for Singapore. .?
It probably means singapore has significantly lost its competitive edge n that foreign investors find it no longer worth to invest in singapore anymore.
Or a sharp world wide recession has kicked in...n it means even longer recovery period.
Recession aside, is there any point to buy more property to invest since no one wants to buy? :beats-me-man:
If let's say the economy Singapore stops growing. ..population in general will drop since there will not be much FT. Unemployment rate will probably raise..n people might even move out of singapore in search of better job. There will mean a hell lot of empty properties doesnt it?
Of course it will be a different story if government purposely crash the prices.
However this will undermine the banks since a lot of people will be forced to top up the difference in their loan. Then a vicious cycle ensure...Wouldnt this undermind singapore banks in general? .:beats-me-man:
Would the goverment want to rock the boat so badly?
If the goverment purposely crashed the prices to historic low, undermind the existing home owners n the banks, wouldn't this send a signal that singapore is not a stable place to invest in? Would anyone want to buy bearing in mind that they could be subjected to the same treatment when the goverment decides to intervene?
I tend to see everything as linked..n consequences of each outcomes. So many qns n no answers. :banghead:
propertyguru
02-05-14, 10:10
Just thinking aloud from a buyer's perspective...
One factor now is the SSD which means if you want to buy you need to hold for four years. Thus the issue is not just whether there will be a drop now... but what happens if you buy now and can only cash out after four years.
e.g. for a 2 m property:
A expects price to drop 10% or 200k. A waits and doesn't buy until it drops to 1.8m.
B expects price to stay flat. B buys now and rents it out for four years thus making 200k in rental (conservative assumption).
If A is wrong about price dropping 10%, then A doesn't buy in the next four years and loses 200k in rental income, and takes the risk that after four years the down-cycle is over and price shoots up.
If B is wrong about price staying flat, then B takes the risk over four years that prices crash >10%. However as long as prices doesn't crash >10%, B is still better off buying as his rental in four years covers any potential loss, and perhaps, by the time he wants to sell, the up-cycle begins.
Admittedly, this is a very simplistic example - but considering the above, do you think buyers are more desperate to buy, or sellers are more desperate to sell? :doh:
This was my perspective as a buyer last year and remains my view.
Obviously, this is on the assumption that you want to invest in Singapore (there may of course be better investments outside of Singapore). My view even when I bought was that prices were more likely than not to drop about 5-10% in the next couple of years, with a very small possibility of prices rising even higher than what they were. With that in mind, I had to decide whether to re-enter the market having just disposed of another property for a small profit.
Ultimately, I bought a >$2m unit with tenancy, because I saw that my potential (and likely) downside was about $200k, but if I waited, my potential (though unlikely) downside was being priced out of the market, possibly forever (I am not a rich man nor do I have a trust fund).
Half a year on, prices have softened further, and I think I would be able to get a bigger unit today for the price I paid (or pay less for a unit of similar size). The drop is about 5% I reckon (based on caveats lodged), so on a >$2m property, I would have saved more than $100k. Be that as it may, I have collected about $40k in rental already, which covers my mortgage payments so far.
What I effectively did by buying last year was to get my foot in the door, and protect my downside by buying a property with tenancy. It's impossible to time the market perfectly, and with hindsight, I daresay it would have been better for me to have bought the property today. However, there's no guarantee that unit I wanted would have remained available today (and we really liked it), and certainly, it would have been hard to find one with tenancy today (those invariably come with a premium because the sellers can afford to hold).
Whether one should buy now or not must depend on where you see the market going, but it's hard to argue against buying now (prices have softened considerably) unless you think the Singapore economy is going to tank and stay in the doldrums for years. Otherwise, as the global economy picks up steam, and Singapore benefits from that growth, property prices will only continue to rise (not even taking into account the expected population growth).
Even for home-owners looking to buy, I would think it makes sense to buy now provided you really like the unit on the market. If you plan to stay more than a few years in it, you will likely be able to ride out any temporary turbulence even if prices do drop further in the next couple of years, whereas if you wait, the potential for a drop in prices may be outweighed by the risk of prices rising beyond your reach.
"Fair share" to all people policy by garment favours property investors as most of the people from 30s and above are servicing their loan. A major correction of more than 20% will not be good for the garment especially during GE. GE can happen in 2015.
I cashed out recently, and i am not coming back so soon, as an investor i am only interested in money.....i see nothing here coming...... the rest u see it for yourself..good luck..
Singapore gov is too capable to give fair share to all the people evenly.... can be good and bad.....
"Fair share" to all people policy by garment favours property investors as most of the people from 30s and above are servicing their loan. A major correction of more than 20% will not be good for the garment especially during GE. GE can happen in 2015.
Looks high chance in 2015 ;)
If the goverment purposely crashed the prices to historic low, undermind the existing home owners n the banks, wouldn't this send a signal that singapore is not a stable place to invest in? Would anyone want to buy bearing in mind that they could be subjected to the same treatment when the goverment decides to intervene?
I tend to see everything as linked..n consequences of each outcomes. So many qns n no answers. :banghead:
Lastly although very slow take up...there are more n more people purchasing the properties. .once onboard i doubt they want the prices to crash.
when the net effect kicks in...ie tipping point...I think only the minority hopes the prices to crash.
Bearing in mind singapore has the highest homeownership. ..n surely a good percentage is still servicing their loan.
This was my perspective as a buyer last year and remains my view.
Obviously, this is on the assumption that you want to invest in Singapore (there may of course be better investments outside of Singapore). My view even when I bought was that prices were more likely than not to drop about 5-10% in the next couple of years, with a very small possibility of prices rising even higher than what they were. With that in mind, I had to decide whether to re-enter the market having just disposed of another property for a small profit.
Ultimately, I bought a >$2m unit with tenancy, because I saw that my potential (and likely) downside was about $200k, but if I waited, my potential (though unlikely) downside was being priced out of the market, possibly forever (I am not a rich man nor do I have a trust fund).
Half a year on, prices have softened further, and I think I would be able to get a bigger unit today for the price I paid (or pay less for a unit of similar size). The drop is about 5% I reckon (based on caveats lodged), so on a >$2m property, I would have saved more than $100k. Be that as it may, I have collected about $40k in rental already, which covers my mortgage payments so far.
What I effectively did by buying last year was to get my foot in the door, and protect my downside by buying a property with tenancy. It's impossible to time the market perfectly, and with hindsight, I daresay it would have been better for me to have bought the property today. However, there's no guarantee that unit I wanted would have remained available today (and we really liked it), and certainly, it would have been hard to find one with tenancy today (those invariably come with a premium because the sellers can afford to hold).
Whether one should buy now or not must depend on where you see the market going, but it's hard to argue against buying now (prices have softened considerably) unless you think the Singapore economy is going to tank and stay in the doldrums for years. Otherwise, as the global economy picks up steam, and Singapore benefits from that growth, property prices will only continue to rise (not even taking into account the expected population growth).
Even for home-owners looking to buy, I would think it makes sense to buy now provided you really like the unit on the market. If you plan to stay more than a few years in it, you will likely be able to ride out any temporary turbulence even if prices do drop further in the next couple of years, whereas if you wait, the potential for a drop in prices may be outweighed by the risk of prices rising beyond your reach.
I think you are weighing the lost opportunity costs (tangible n intangible cost) vs the cost saved if you have waited.
Can you see the stars are all aligning? ;)
Looks high chance in 2015 ;)
Can you see the stars are all aligning? ;)
I just visited sky habitat yesterday and had a shock !!!!
hahahahaha
check out how many units left....
did u attend any of the may day event???
propertyguru
02-05-14, 10:43
I think you are weighing the lost opportunity costs (tangible n intangible cost) vs the cost saved if you have waited.
Not really. Don't think there's any opportunity cost in waiting unless I planned to move in; the opportunity cost in buying is what I could have invested in with the available cash. I saw it simply as a weighing of my downsides, and the potential downside (though lower) of waiting was being priced out of the market forever, whereas the potential downside of buying was simply a slight loss in the near-term (in which I can't sell anyway because of the SSD). A comparison of these downsides persuaded me that buying was the better option in the long run.
My agent said it is a good buy. There are still quite a lot of wealthy people around. What is the sentiment?:p
I just visited sky habitat yesterday and had a shock !!!!
hahahahaha
check out how many units left....
did u attend any of the may day event???
My agent said it is a good buy. There are still quite a lot of wealthy people around. What is the sentiment?:p
It is a good buy if I dont need to come out extra >160K....
1.6m = 1.76m (not including the standard 3%)
That place i think better buy than commonwealth (personal view)....
Cheers
;);)
invigorated
02-05-14, 11:22
Ultimately, I bought a >$2m unit with tenancy, because I saw that my potential (and likely) downside was about $200k, but if I waited, my potential (though unlikely) downside was being priced out of the market, possibly forever (I am not a rich man nor do I have a trust fund).
Half a year on, prices have softened further, and I think I would be able to get a bigger unit today for the price I paid (or pay less for a unit of similar size). The drop is about 5% I reckon (based on caveats lodged), so on a >$2m property, I would have saved more than $100k. Be that as it may, I have collected about $40k in rental already, which covers my mortgage payments so far.
Fully agree that if you have already made calculated decisions, there shouldn't be regrets and they are already in the range of expectations.
Just curious, when you talk about rental gain here, does that factor in the extra taxes paid and the loss of potential interest from, say fixed deposits? Even fixed dep would pay out abt 1.7% a year ago. That's already some 17k for a 1 mil deposit for a year.
some people lurking in this forum shouting crash all the time are likely not to understand Singapore Fundamentals.
PS:
CRASH is an overstatement. dont assume crash all the time as if you have a crystal ball on your hand.
propertyguru
02-05-14, 12:27
Fully agree that if you have already made calculated decisions, there shouldn't be regrets and they are already in the range of expectations.
Just curious, when you talk about rental gain here, does that factor in the extra taxes paid and the loss of potential interest from, say fixed deposits? Even fixed dep would pay out abt 1.7% a year ago. That's already some 17k for a 1 mil deposit for a year.
Not sure what you are asking, but I didn't have $1m in cash sitting around, so I couldn't have earned that $17k interest anyway. I am not actually gaining much in terms of rental; rental return is about 3% based on back of envelope calculation, which is really nothing to shout about. I was happy to buy with the tenancy because it mitigated any expected capital loss of between 5-10% in the property price.
Based on my limited experience, I think property is a relatively good investment in Singapore. I don't have access to funds and other investment instruments the rich perhaps have, so property is my best bet. And the key was to get my foot behind the door first, especially because my last property bet had paid off relatively well.
Londonproperty123
02-05-14, 12:35
I just visited sky habitat yesterday and had a shock !!!!
hahahahaha
check out how many units left....
did u attend any of the may day event???
How many units of Sky habitat left?
Newspapers today said commonwealth tower sales also not bad.
Not sure what you are asking, but I didn't have $1m in cash sitting around, so I couldn't have earned that $17k interest anyway. I am not actually gaining much in terms of rental; rental return is about 3% based on back of envelope calculation, which is really nothing to shout about. I was happy to buy with the tenancy because it mitigated any expected capital loss of between 5-10% in the property price.
Based on my limited experience, I think property is a relatively good investment in Singapore. I don't have access to funds and other investment instruments the rich perhaps have, so property is my best bet. And the key was to get my foot behind the door first, especially because my last property bet had paid off relatively well.
do note that rental income will rise as you run down your loan. so by the time your properties are fully paid up, you should have sufficient passive income for retirement. Having said that, as landlord you still need to set aside money to maintain your properties.
I just visited sky habitat yesterday and had a shock !!!!
hahahahaha
check out how many units left....
did u attend any of the may day event???
Sky H how many units left?
Agent told me 80% sold.... I too lazy to confirm.... Because not buying just yet...
If can wait, skyvue will lelong when time come...
Really got good buys with all the max 5 year holding / sell within 2 years top if not absd for developers....
So if someone compile all the developers that top and still got units, can squeeze leh
Wolverine23
03-05-14, 08:33
do note that rental income will rise as you run down your loan. so by the time your properties are fully paid up, you should have sufficient passive income for retirement. Having said that, as landlord you still need to set aside money to maintain your properties.
Will Rents always continue to rise?
In any case, my own cashflow projects that even in a case of unchanged rental over 15 to 30 years, there is big money in owning real estate. :)
However, I have factored in an annual appreciation of 2% for the property. Sounds logical?
I just visited sky habitat yesterday and had a shock !!!!
... Most of the 3bd and 2bd, 1bd are sold. In fact best facing 3bds were sold out on day 1. The new promo moved most of the remaining 3/2/1 bds.
however almost all of the 4bd and terrace units are unsold. Price 2.5mil for 4bd and 3.* mil for terrace. And this time round CAPL is not doing any promo for these units. So not a single one moved. It's clear no one wants to spend > 1.7mil at today's mkt, even at a good location like this.
... Most of the 3bd and 2bd, 1bd are sold. In fact best facing 3bds were sold out on day 1. The new promo moved most of the remaining 3/2/1 bds.
however almost all of the 4bd and terrace units are unsold. Price 2.5mil for 4bd and 3.* mil for terrace. And this time round CAPL is not doing any promo for these units. So not a single one moved. It's clear no one wants to spend > 1.7mil at today's mkt, even at a good location like this.
Honestly, the price very sweet for that location.... Considering Moshe is a bonus....
The price is sweeter than sky vue...
Londonproperty123
03-05-14, 10:23
Overall, I think it is reasonable to assume that Singapore Government won't want the property prices to crash.
However, there are always global events that are beyond Singapore Government's control.
One of the risks in the global economy is the credit crunch in China.
Read more here:
http://londonproperty123.blogspot.sg/2014/05/li-ka-shing-into-uk-utilities-selling.html
They all thinking too much lah!
I heard some small talks going around about the reason - it is because Li is not as well connected to current new head, so not comfortable with so much investments in China, diversifying..................
As for HK, HK is dying lah! :ashamed1:
Overall, I think it is reasonable to assume that Singapore Government won't want the property prices to crash.
However, there are always global events that are beyond Singapore Government's control.
One of the risks in the global economy is the credit crunch in China.
Read more here:
http://londonproperty123.blogspot.sg/2014/05/li-ka-shing-into-uk-utilities-selling.html
Londonproperty123
03-05-14, 11:14
They all thinking too much lah!
I heard some small talks going around about the reason - it is because Li is not as well connected to current new head, so not comfortable with so much investments in China, diversifying..................
As for HK, HK is dying lah! :ashamed1:
So you think that all the reports on China's impending credit crunch are baseless?
So you think that all the reports on China's impending credit crunch are baseless?
Key in start date 1989...
http://www.tradingeconomics.com/china/gdp-growth-annual
Anybodies guess...
When was china's last recession????
Which is the 2nd largest consuming country????
What happens worldwide when they crash???
walkthetiger
03-05-14, 12:26
They all thinking too much lah!
I heard some small talks going around about the reason - it is because Li is not as well connected to current new head, so not comfortable with so much investments in China, diversifying..................
As for HK, HK is dying lah! :ashamed1:
....haha.... no more crash from you??
HK is dying..I agree...especially the rich man world....try to look into china-HK politic... you will understand better
You are in a fortunate position. Not many have this situation to contend with!
My personal view is that the high end will continue weakening. Developers are starting to accept offers from willing buyers in new high end developments as opposed to holding firm to their asking prices.
This is starting to trickle down to the mid to mid-high end of the market. Developers are dropping prices to ensure cash flow for the next few years. That is above all the critical thing.
If you wait and hold, your rentals will cover and you always have the long term value of the properties. Nothing wrong with that. Look at how Wee Cho Yaw manages his properties. He hardly ever sells. So long as cash flow is there to cover the mortgage (even if interest raise rise) you don't need to sell.
You should sell possibly one if you believe: 1) there is another investment out there (real estate, or otherwise) that may yield a better return; or 2) hold cash because you see a downturn coming and hence want to cash up to play that downturn. I think many people usually find that they don't have enough cash whenever there is a downturn ...
Wee Cho Yaw do sell.....
He build and sell the lousy assets while holding his prime assets tight tight............. :D
He basically controls most of the commercial properties around Novena Square MRT station through his UOL.....
You are in a fortunate position. Not many have this situation to contend with!
My personal view is that the high end will continue weakening. Developers are starting to accept offers from willing buyers in new high end developments as opposed to holding firm to their asking prices.
This is starting to trickle down to the mid to mid-high end of the market. Developers are dropping prices to ensure cash flow for the next few years. That is above all the critical thing.
If you wait and hold, your rentals will cover and you always have the long term value of the properties. Nothing wrong with that. Look at how Wee Cho Yaw manages his properties. He hardly ever sells. So long as cash flow is there to cover the mortgage (even if interest raise rise) you don't need to sell.
You should sell possibly one if you believe: 1) there is another investment out there (real estate, or otherwise) that may yield a better return; or 2) hold cash because you see a downturn coming and hence want to cash up to play that downturn. I think many people usually find that they don't have enough cash whenever there is a downturn ...
Not really. Don't think there's any opportunity cost in waiting unless I planned to move in; the opportunity cost in buying is what I could have invested in with the available cash. I saw it simply as a weighing of my downsides, and the potential downside (though lower) of waiting was being priced out of the market forever, whereas the potential downside of buying was simply a slight loss in the near-term (in which I can't sell anyway because of the SSD). A comparison of these downsides persuaded me that buying was the better option in the long run.
Thanks for sharing your experience which is very helpful. I agree that your decision was reasonable in those circumstances and nice properties in good areas are not easy to come by anyway. Even if you had bought now, there is no guarantee that the owner of the same unit would lower his asking price, particularly if it is tenanted and has good facing/views.
Whether your timing was good or not will only be proven after 4 years when you can sell (without incurring SSD). Thus you can tune out the noise, sleep well at night and wake up after 4 years. Anyway, by that time many new MRT stations would be up and that should bring some degree of price appreciation all around - investment by the government into infrastructure always pays off, even in the CCR (in my opinion some MRT stations in CCR will give a significant boost to surrounding areas with big tenanted population e.g. great world mrt).
propertyguru
09-05-14, 10:43
Thanks for sharing your experience which is very helpful. I agree that your decision was reasonable in those circumstances and nice properties in good areas are not easy to come by anyway. Even if you had bought now, there is no guarantee that the owner of the same unit would lower his asking price, particularly if it is tenanted and has good facing/views.
Whether your timing was good or not will only be proven after 4 years when you can sell (without incurring SSD). Thus you can tune out the noise, sleep well at night and wake up after 4 years. Anyway, by that time many new MRT stations would be up and that should bring some degree of price appreciation all around - investment by the government into infrastructure always pays off, even in the CCR (in my opinion some MRT stations in CCR will give a significant boost to surrounding areas with big tenanted population e.g. great world mrt).
The property I bought is near Tanjong Katong in RCR, so I am waiting for news of the ERL haha. Confirmation of the station locations (if near the property) would be very helpful in the long run. Yes, I think if you are investing in properties you must believe in the long-term potential of Singapore. While the government may have been inadequate at times in catering for the less privileged, I think they have done well re-inventing Singapore over the past decade (Gardens by the Bay, Marina Bay Sands, Resorts World Sentosa, etc) for tourists and investors alike. If we continue to attract both, and the population continues to increase (whether we like it or not), I don't really see property prices dropping by much. This is just a temporary period of price stabilisation; I reckon it will hold steady (or drop a few percent more) for a couple more years before prices will eventually rise again.
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