Property Prices Coming Down?

[Londonproperty123]

According to ST, prices have come down 1.3% in 2014 Q1. Private home prices fell across the island, the first time in nearly 5 years, with the biggest drop in the city fringe (areas like Bishan & Queenstown).

Out of total supply of 80,261 private homes under construction at the end of March, slightly more than 1/3 or 29,482, were still unsold. This 80,261 number excludes the Executive Condos.

After adding the supply of 13,691 EC units in the pipeline, the total number is 93,952 units in the pipeline. Further, another 11,042 units would soon be added to the pipeline. This brings the total to 105,000 EC plus private units in the pipeline. All these exclude HDB.

http://i60.tinypic.com/2eaksoy.jpg

I have blogged more here- http://londonproperty123.blogspot.sg/2014/04/singapore-property-prices-coming-down.html

[Yuki]

According to ST, prices have come down 1.3% in 2014 Q1. Private home prices fell across the island, the first time in nearly 5 years, with the biggest drop in the city fringe (areas like Bishan & Queenstown).

Out of total supply of 80,261 private homes under construction at the end of March, slightly more than 1/3 or 29,482, were still unsold. This 80,261 number excludes the Executive Condos.

After adding the supply of 13,691 EC units in the pipeline, the total number is 93,952 units in the pipeline. Further, another 11,042 units would soon be added to the pipeline. This brings the total to 105,000 EC plus private units in the pipeline. All these exclude HDB.

http://i60.tinypic.com/2eaksoy.jpg

I have blogged more here- http://londonproperty123.blogspot.sg/2014/04/singapore-property-prices-coming-down.html

Hi thanks so much. For sharing
Have read your blog too.

Btw how do we quantify falling prices? By psf? Or overall total price?

From what I look at the newly launched units are getting smaller with psf raising even if the overall price is reduced.

However for existing luxury projects, they have to clear unsold inventory they have to slash prices to move.

[leesg123]

Hi thanks so much. For sharing
Have read your blog too.

Btw how do we quantify falling prices? By psf? Or overall total price?

From what I look at the newly launched units are getting smaller with psf raising even if the overall price is reduced.

However for existing luxury projects, they have to clear unsold inventory they have to slash prices to move.You need to also look at the volume. Although it seems like prices are falling, go and try to find a cheap bargain. Not easy. This current drop in price is not a mass market phenomenon, but more like a few firesale only.

What i see the current situation is that owners are holding on, buyers are waiting. see who blink first. It depends who have a more urgent need.

[Arcachon]

http://yanziyang.wordpress.com/2014/01/22/bubble-depends-on-where-and-how-you-look/

The chance of a property bubble in Singapore is very slim as housing loans only account for a small portion of property values, according to comments from Citigroup which were reported in the media.

Based on its analysis of government data, the country's $203 billion worth of mortgages amounted to 24.2 percent of the value of residential properties in Q3 2013.
"Nobody has walked me through the mechanics of a total crash of the real estate market for it to be compelling," said Michael Zink, Head of Citi's ASEAN operations.

"Ninety percent of households (in Singapore) live in a home that they own, so where's the bubble?" he asked, adding that many households here are financially very stable.

In addition, about 82 percent of Singaporeans live in public housing and most of them have already paid off their mortgages, noted Singapore-based Zink, who has lived in other Asian cities such as Jakarta and Guangzhou.

"The potential for a bubble has been greatly deflated" thanks to the government's series of property cooling measures, especially the TDSR framework imposed last June, added Nicholas Mak, Executive Director and Head of Research at SLP International Property Consultants.

Following a recent Forbes article claiming that the city-state is heading for an "Iceland-style meltdown", the Monetary Authority of Singapore (MAS) said last month that household balance sheets here have strengthened, while new housing loans have declined.

Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories email [email protected]

[Arcachon]

http://www.moneysmart.sg/housing-property/why-2014-is-going-to-be-the-best-year-to-buy-property/

[teddybear]

3. Because You’ll Be Able to Purchase Additional Properties with Little or No Financing

It’s no surprise that because of tighter home loan restrictions, the most you might be able to borrow from a bank is only 20% to 50%, depending on your loan tenure. Not to mention you’ll need to make a 25% down payment on the property.
That means buying that 1.5 million dollar property you’ve been eyeballing is probably about as realistic as landing a date with Jennifer Lawrence. Of course, that doesn’t mean you can’t look at properties in the $600,000 to $800,000 range – which you may be able to purchase with little or no financing.
But there’s another way to purchase property in this buyer’s market – buying property from new launches through the progressive payment scheme.
“In most new launches, units priced below $1 million are usually purchased quickly. That’s because payment for new developments is made progressively, allowing buyers who aren’t severely affected by tighter loan rules to buy smaller units with cash instead of financing larger units,” states Eugene.


http://www.moneysmart.sg/housing-property/why-2014-is-going-to-be-the-best-year-to-buy-property/

[Londonproperty123]

Har? Sorry I'm very new to all this. I don't understand the latest post.

[Londonproperty123]

Hi thanks so much. For sharing
Have read your blog too.

Btw how do we quantify falling prices? By psf? Or overall total price?

From what I look at the newly launched units are getting smaller with psf raising even if the overall price is reduced.

However for existing luxury projects, they have to clear unsold inventory they have to slash prices to move.

I think URA index is based on transactions prices which is based on caveats lodged. So it is not by psf.

[Yuki]

http://yanziyang.wordpress.com/2014/01/22/bubble-depends-on-where-and-how-you-look/

The chance of a property bubble in Singapore is very slim as housing loans only account for a small portion of property values, according to comments from Citigroup which were reported in the media.

Based on its analysis of government data, the country's $203 billion worth of mortgages amounted to 24.2 percent of the value of residential properties in Q3 2013.
"Nobody has walked me through the mechanics of a total crash of the real estate market for it to be compelling," said Michael Zink, Head of Citi's ASEAN operations.

"Ninety percent of households (in Singapore) live in a home that they own, so where's the bubble?" he asked, adding that many households here are financially very stable.

In addition, about 82 percent of Singaporeans live in public housing and most of them have already paid off their mortgages, noted Singapore-based Zink, who has lived in other Asian cities such as Jakarta and Guangzhou.

"The potential for a bubble has been greatly deflated" thanks to the government's series of property cooling measures, especially the TDSR framework imposed last June, added Nicholas Mak, Executive Director and Head of Research at SLP International Property Consultants.

Following a recent Forbes article claiming that the city-state is heading for an "Iceland-style meltdown", the Monetary Authority of Singapore (MAS) said last month that household balance sheets here have strengthened, while new housing loans have declined.

Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories email [email protected]

Thanks for sharing. There is an NUS research on the affordability of the housing and a gist of the income ratio vs the annual income was stated in that report. In addition, there was another analysis that writes that the palpable correlation between raising income and property prices over the years.

I just wonder what should be "correct/right" property price since a lot of reports kept saying that the prices have been artificially inflated.

[Allthepies]

Bishan new launches have cut prices...10 to 20% I think... but why are u all still not buying and keep asking can buy or not?? Because in your mind u think price is expensive and will always drop more...so u wait and wait thinking more price cut is coming... then one fine day the property market "suddenly" shoot up and cheong to a new level... then u all "miss the boat" will cry foul and say next time when price "fall" u will definitely buy... the cycle repeats...

Meanwhile another group of people have taken action and becomes multi-millionaire. .. : )

[di]

Thanks for sharing. There is an NUS research on the affordability of the housing and a gist of the income ratio vs the annual income was stated in that report. In addition, there was another analysis that writes that the palpable correlation between raising income and property prices over the years.

I just wonder what should be "correct/right" property price since a lot of reports kept saying that the prices have been artificially inflated.


http://www.moneysmart.sg/housing-property/why-2014-is-going-to-be-the-best-year-to-buy-property/

Will the developer cut the sizes, materials used etc in anticipation of this 10% drop mentality? I believe they do. :(

The quantum might look smaller but when u look at psf, it is actually much higher.

When I compared left over units released last year vs the units just released this year, they are so much smaller even if they are "cheaper". :doh: In fact, the longer we wait, the smaller the units.

We are looking for home stay, and have been waiting since quite a few years ago back in 2011. And when we went back to the past launches, not much choices left.

Only left these cheap cheap ones near the sub-stations or facing west sun or facing the nosy roads - as "star buy" lor. :doh:

These few years the land plots have been brought at a higher price. If we are to wait for the developer to bid lower in further launches, that will mean another like 5 years of wait to feel this effect.

And there is still a risk on whether if they kept minting even smaller units to boost their profitability, since their profits were squeezed for the past few years. By then our ages would have caught up and the max loan tenure will be shorter, and interest rates higher.

[Jaykj]

Will the developer cut the sizes, materials used etc in anticipation of this 10% drop mentality? I believe they do. :(

The quantum might look smaller but when u look at psf, it is actually much higher.

When I compared left over units released last year vs the units just released this year, they are so much smaller even if they are "cheaper". :doh: In fact, the longer we wait, the smaller the units.

We are looking for home stay, and have been waiting since quite a few years ago back in 2011. And when we went back to the past launches, not much choices left.

Only left these cheap cheap ones near the sub-stations or facing west sun or facing the nosy roads - as "star buy" lor. :doh:

These few years the land plots have been brought at a higher price. If we are to wait for the developer to bid lower in further launches, that will mean another like 5 years of wait to feel this effect.

And there is still a risk on whether if they kept minting even smaller units to boost their profitability, since their profits were squeezed for the past few years. By then our ages would have caught up and the max loan tenure will be shorter, and interest rates higher.

You are quite enlightened. I agree with your comments. End of the day, own stay or investment, anytime is a good time to buy as long as you can afford.

[Antz621]

Bishan new launches have cut prices...10 to 20% I think... but why are u all still not buying and keep asking can buy or not?? Because in your mind u think price is expensive and will always drop more...so u wait and wait thinking more price cut is coming... then one fine day the property market "suddenly" shoot up and cheong to a new level... then u all "miss the boat" will cry foul and say next time when price "fall" u will definitely buy... the cycle repeats...

Meanwhile another group of people have taken action and becomes multi-millionaire. .. : )


One question about Bishan. Take Sky Habi for example. When it was launched in Apr'12 it was asking 16xx-19xxpsf. The response; well as we know; was nothing to shout about. Considering that there was no TDSR rulings and ppty mkt was still relatively good at that time, it was a direct indication that the market cannot digest at that price despite its location. If there was TDSR ruling back then; this would be a ghost condo waiting to TOP next year.

Fast forward to today, Developer Capland went out with discounts; booking losses for this project to bring down the prices to 13xx-16xxpsf. It indeed looked attractive to buyers. But when these buyers were to sell later; back at 16xx-19xxpsf in order to break even and profit decently, will they be able to succeed when the precedent already showed them otherwise? :confused:

[Yuki]

I think the property cycle is getting shorter as the population is increased too quickly.

This pace of change overwhelmed pp infra n other development. Also magnifying the gaps n loopholes of the polices in place. If the pace of change is gradual, all the stakeholders involved ..like the goverment should be able to calibrate the policies n response s better n the buyers will not go into a mass hysteria or irrational buying frenzy!

In short, Think playing the simulation game Sim city in fast forward mode.

What you. Di has highlighted are the negative consequences of the multiple polices working in tandem.

At the end of the day we the homeowner s pay the ultimate price in terms of living space n quality of property n life. :doh:

[Yuki]

One question about Bishan. Take Sky Habi for example. When it was launched in Apr'12 it was asking 16xx-19xxpsf. The response; well as we know; was nothing to shout about. Considering that there was no TDSR rulings and ppty mkt was still relatively good at that time, it was a direct indication that the market cannot digest at that price despite its location. If there was TDSR ruling back then; this would be a ghost condo waiting to TOP next year.

Fast forward to today, Developer Capland went out with discounts; booking losses for this project to bring down the prices to 13xx-16xxpsf. It indeed looked attractive to buyers. But when these buyers were to sell later; back at 16xx-19xxpsf in order to break even and profit decently, will they be able to succeed when the precedent already showed them otherwise? :confused:

Maybe in 20yrs or 30yrs time? :confused:

Honestly the developers are so bl**dy greedy.

Spoil their own market. If they have thought long term adverse effects n the negative consequences from the government n for e property market in general they wouldnt have pushed out such un sustainable prices.

[Antz621]

Maybe in 20yrs or 30yrs time? :confused:

Honestly the developers are so bl**dy greedy.

Spoil their own market. If they have thought long term adverse effects n the negative consequences from the government n for e property market in general they wouldnt have pushed out such un sustainable prices.

Maybe its in their blood to take such risks. After all, its the same developer who can't sell out D'Leedon & Interlace till today.

[Yuki]

Maybe its in their blood to take such risks. After all, its the same developer who can't sell out D'Leedon & Interlace till today.

Or..see this in another way.

even if D'Leedon & Interlace not fully sold, they still make enough money from these buyers to take another risk on another project. :beats-me-man: