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Thread: Khaw: HDB will be the price-setter

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    Default Khaw: HDB will be the price-setter

    As reported in the Straits Times, 13 April 2013

    Mr Khaw lamenated that, judging from the packed showrooms, it has not "sunk in" for Singaporeans that the era of huge capital gains for property gains is at an end, with slower economic and thus wages growth in the years ahead.

    While property prices have moderated across the board in the past year, "there is still scope to bring (prices) down to minus (growth rates) for some segments", he said.

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    You probably can get which segments.
    Quote Originally Posted by Amber Woods
    As reported in the Straits Times, 13 April 2013

    Mr Khaw lamenated that, judging from the packed showrooms, it has not "sunk in" for Singaporeans that the era of huge capital gains for property gains is at an end, with slower economic and thus wages growth in the years ahead.

    While property prices have moderated across the board in the past year, "there is still scope to bring (prices) down to minus (growth rates) for some segments", he said.

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    Quote Originally Posted by DC33_2008
    You probably can get which segments.
    Mr Khaw is so determined to bring down prices of new BTO flats by 30% and resale prices to 2009 price level. It will have great impact on prices for mass market PCs. These are the segments that need to be managed.

    The mid end and high end will find their own niches in the market going forward.

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    Quote Originally Posted by Amber Woods
    Mr Khaw is so determined to bring down prices of new BTO flats by 30% and resale prices to 2009 price level. It will have great impact on prices for mass market PCs. These are the segments that need to be managed.

    The mid end and high end will find their own niches in the market going forward.
    He only said bto flat in non mature estate and it will be bounded by some rules.
    He did not say anything on resale flat. Don't misled.

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    Quote Originally Posted by star
    He only said bto flat in non mature estate and it will be bounded by some rules.
    He did not say anything on resale flat. Don't misled.
    One must learn how to read between the lines of politicians. You are free to believe otherwise.

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    Private home price will go gradually higher as land price is getting higher. Foreigner workers levy cost is getting higher. If it is cheap foreigners will flood in here.

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    Khaw mulls the idea of no income ceiling for HDB flats..price going up soon?

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    Mr Khaw was also wondering why people are still packing the showflats. Singaporeans have not sunk-in to the new reality.

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    On Monday, one lady from Queenstown came all the way to my MPS at Sembawang. She came with her son. She had not slept well since she heard the news that I may stop the resale of HDB flats in the open market, and that all resale would be to HDB only. She wanted to know if she had heard correctly.

    She has a fully paid up 3R flat and had booked a new BTO flat in Bukit Panjang which will be ready in a couple of years’ time. She has done her sum and expects to have a sizeable net cash proceeds. That will be her retirement fund. The news that she has heard may squash her dream.

    I told her that she has completely misunderstood the media reports on what I said in Parliament! Briefly I told Parliament that there had been many calls for HDB to “return to basics”, for example to “return to the past when flats could only be sold to HDB, and not in the open market”. Such a call would have major impact on existing flat owners, especially the seniors, like her.

    We want to provide affordable housing for new homeowners, especially young couples, but we will not forget the interest of the many hundreds of thousands of existing homeowners. Some plan to rely on their flat to finance retirement needs. Some hope to bequeath their flats to the next generation. Some rely on renting out a room to bring in extra cash proceeds. Their concerns matter to me too.

    I told her that I do plan to see how we can come up with a new housing option which can be a lot cheaper than today’s BTO price. And if we offer such a low-cost housing option, it must come with restrictions to differentiate it from the existing BTO flats. I mentioned some such restrictions as proposed by some MPs: longer minimum occupation period, shorter lease and no resale in the open market.

    Obviously, if we offer such an option, these restrictions of a longer minimum occupation period, or shorter lease or no resale in the open market will only apply to the new buyers, and will not apply to existing flat owners like the Queenstown lady. I assured her that her dream is safe and I congratulate her on how the HDB policies have benefited her, and that she could now look forward to both a new BTO flat (with 99 year lease) and a significant retirement fund.

    Our Singapore ConversationThere must be many like her out there. They have been silent in not voicing their views publicly. I intend to give voice to this majority of flat owners and to invite them to join the Our Singapore Conversation, to articulate their concerns when housing policies are discussed. If the flat owners who form the vast majority remain silent, discussion on housing policies may get wrongly skewed.

    She was relieved after I explained to her. She went on to tell me that her son is still single and asked if I could introduce some girl friends to him!

    Looks like she will be sleepless no more.

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    Quote Originally Posted by star
    He did not say anything on resale flat. Don't misled.
    You need to read ST's full article on KBW's interview.

    "Being led by the private sector is like a tail wagging the dog. We should be the price-setter, not the price follower...."

    " I can't set market prices in the private sector, but I can influence it..."

    KBW
    Last edited by avo7007; 13-04-13 at 11:19.

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    Quote Originally Posted by oops
    Khaw mulls the idea of no income ceiling for HDB flats..price going up soon?
    He mentioned this is to allow more bold ideas coming in. He wants prices of new BTO flat reduce by 30%.

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    Quote Originally Posted by avo7007
    You need to read ST's full article on KBW's interview.

    "Being led by the private sector is like a tail wagging the dog. We should be the price-setter, not the price follower...."

    " I can't set market prices in the private sector, but I can influence it..."

    KBW
    Exactly! If we read his message clearly, Khaw is concerned with the current high prices for the mass market as well and he wants to influence it through the pricing of new BTO flats and hence resale flats.
    Last edited by Amber Woods; 13-04-13 at 11:21.

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    Lol. Let see how price goes when land cost rises.

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    Quote Originally Posted by star
    Lol. Let see how price goes when land cost rises.
    You have forgotten (maybe too young to remember) many developers were stucked with their highly bid price lands in the past and how they cut losses during those days. If developers read wrongly how the market is going forward, they will suffer losses just like any investors who buy their PCs during the peak of the cycle.

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    Quote Originally Posted by Amber Woods
    Exactly! If we read his message clearly, Khaw is concerned with the current high prices for the mass market as well and he wants to influence it through the pricing of new BTO flatsand hence resale flats.
    Yap. I think KBW's strategy is pretty clear. He will use BTO's supply and prices to moderate resale flat prices and in turn the mass PC market will moderate too. That's the supply side. Tharman will hit the demand side with CMs.

    The market can be stubborn, but the government is just as determined to moderate the market.

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    Quote Originally Posted by Amber Woods
    You have forgotten (maybe too young to remember) many developers were stucked with their highly bid price lands in the past and how they cut losses during those days. If developers read wrongly how the market is going forward, they will suffer losses just like any investors who buy their PCs during the peak of the cycle.
    Hahahaha. Interesting. Pls crash it. Pls i beg u.

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    Quote Originally Posted by star
    Hahahaha. Interesting. Pls crash it. Pls i beg u.
    In ancient, folks pray for rain, in modern days, folks pray for property/stock market to crash.


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    Quote Originally Posted by star
    Hahahaha. Interesting. Pls crash it. Pls i beg u.
    Your wish is not likely to come true. Khaw wants a soft landing so that people have time to react and take actions.

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    Obviously, if we offer such an option, these restrictions of a longer minimum occupation period, or shorter lease or no resale in the open market will only apply to the NEW buyers, and WILL NOT apply to existing flat owners like the Queenstown lady. I assured her that her dream is safe and I congratulate her on how the HDB policies have benefited her, and that she could now look forward to both a new BTO flat (with 99 year lease) and a significant retirement fund.

    Our Singapore ConversationThere must be many like her out there. They have been silent in not voicing their views publicly. I intend to give voice to this majority of flat owners and to invite them to join the Our Singapore Conversation, to articulate their concerns when housing policies are discussed. If the flat owners who form the vast majority remain silent, discussion on housing policies may get wrongly skewed.

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    Quote Originally Posted by oops
    Obviously, if we offer such an option, these restrictions of a longer minimum occupation period, or shorter lease or no resale in the open market will only apply to the NEW buyers, and WILL NOT apply to existing flat owners like the Queenstown lady. I assured her that her dream is safe and I congratulate her on how the HDB policies have benefited her, and that she could now look forward to both a new BTO flat (with 99 year lease) and a significant retirement fund.

    Our Singapore ConversationThere must be many like her out there. They have been silent in not voicing their views publicly. I intend to give voice to this majority of flat owners and to invite them to join the Our Singapore Conversation, to articulate their concerns when housing policies are discussed. If the flat owners who form the vast majority remain silent, discussion on housing policies may get wrongly skewed.
    Khaw wants a soft landing so that people have time to react and take appropriate actions.

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    I congratulate her on how the HDB policies have benefited her, and that she could now look forward to both a new BTO flat (with 99 year lease) and a significant retirement fund

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    So we will see new mass market condo next to mrt station to be launched at 580psf like caspian in 2009?

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    Quote Originally Posted by azeoprop
    So we will see new mass market condo next to mrt station to be launched at 580psf like caspian in 2009?
    I'm willing to pay 100psf more for the whole stack if really priced so cheaply....p

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    Quote Originally Posted by azeoprop
    So we will see new mass market condo next to mrt station to be launched at 580psf like caspian in 2009?
    It will takes time if base on policies alone to influence the market. It will be much faster if other external factors stuck us.

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    Quote Originally Posted by avo7007
    Yap. I think KBW's strategy is pretty clear. He will use BTO's supply and prices to moderate resale flat prices and in turn the mass PC market will moderate too. That's the supply side. Tharman will hit the demand side with CMs.

    The market can be stubborn, but the government is just as determined to moderate the market.
    You have summed up the government's intents very clearly and in simple English.

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    it is not the talking that matters, where is the action?
    can garmen sell GLS cheap? can garmen lose $$ in BTOs ? can construction cost go down from 300psf bk to 150psf?

    khaw just warning developers not to be greedy, that's all
    Ride at your own risk !!!

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    Quote Originally Posted by phantom_opera
    it is not the talking that matters, where is the action?
    can garmen sell GLS cheap? can garmen lose $$ in BTOs ? can construction cost go down from 300psf bk to 150psf?

    khaw just warning developers not to be greedy, that's all
    i echo the same sentiments - talk is kinda cheap, and its track record of fulfilling rhetoric discussions had not been overwhelming consistent. I will place my money (and vote) when I see clear tangible action plan and results though

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    There are many ways for the government to increase its tax revenue. If people are spending less on housing, they have more to pay in term of other taxes such as GST, income tax etc etc. If revenues from land selling is costing more social and political hardships in the longer term, no government or political party will want to dig their own graves.

    Yes! the government is certainly giving warning to greedy developers. The era of high profits and increasing property prices are coming to an end due to slower economic and hence wages growth in the years ahead.
    Last edited by Amber Woods; 13-04-13 at 12:05.

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    Quote Originally Posted by danguard
    i echo the same sentiments - talk is kinda cheap, and its track record of fulfilling rhetoric discussions had not been overwhelming consistent. I will place my money (and vote) when I see clear tangible action plan and results though
    I urge you to be a little more patient. You may benefit from it.

    Then again, in investment, one also needs to move in front of the herds.

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    Quote Originally Posted by star
    Hahahaha. Interesting. Pls crash it. Pls i beg u.
    crash so foreigners can buy...
    In the final analysis.....its NOT whether you have a diploma,degree,masters OR PHD....its whether you have a HDB/PC/EC or LANDED...

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