Originally Posted by Unregistered
how to lose money in buying property in Spore if you can hold for 10 years?
Eventually you only make big money for your retirement, better & comfortable life.
For current market, if you can hold till IR ready in 2 years time, you will not lose at all, better still with strong rental, low loan rate of 1-2%, you can have good pocket money. For those sour grape, continue to shout, market moves on.
I think the "sour grapes" here should be more accurately described as "bitter grapes".
If you check up the definition of "sour grapes", it means "false denial of desire for something sought but not acquired; to denigrate and feign disdain for that which one could not attain"
So a real "sour grape" will post something like "Condos are not nice to live in. Not convenient. HDB is better because downstairs got lots of provision shops and coffee shops ... etc."
The "bitter grapes" here are just simply very bitter about the property market having gone up so much in the past two years, and constantly praying that it will crash.
So they are "bitter grapes" and not "sour grapes".
Below is a Sunday Times article about the opposite of a "sour grape".
He is a "sweet apple" - the type of new citizens whom Singapore desires.
Singapore should attract more of this type of people, so that the country as a whole will become more valuable.
Otherwise with the whole place filled with useless "sour grapes" who have no money to buy property, the property market may possibly collapse (exactly like the way they wish).
So hopefully these new "sweet apples" will come in to flush away the "sour grapes" to Johor Bahru. They can go there to cause Johor property to collapse. That is none of my business.
旧的不去，新的不来。
The Straits Times
March 16, 2008
Designing a house begins with the site it sits on
Each has its own look and feel, which dictate the design, developer Satinder Garcha says
By Joyce Teo
AN AVID polo player - he is the captain of the Singapore team - Mr Satinder Garcha, 37, is also a landed property developer, albeit a relatively new one.
In the three years since his first Singapore property was completed, he has built up a sizeable portfolio of 22 properties, many of which are being developed. He will build more on a $78.7 million strip of land at Sentosa Cove.
Mr Garcha, a New Delhi-born Singaporean, came to the Republic after selling his Silicon Valley information technology services company, People.com, in 2000.
The very first house he built in the Republic - a stately bungalow in White House Park that he and his family now live in - was featured in a coffee-table book titled 25 Tropical Houses: In Singapore And Malaysia.
Mr Garcha also managed to secure the services of world-renowned architect Zaha Hadid for two bungalows to be built on Nassim Road. Based in Britain, the Baghdad-born architect became, in 2004, the first woman to receive the Pritzker Architecture Prize.
My brother who works in the property industry told me that construction cost has risen to around $450 psf.
This is primarily due to the contnuous increase in steel price and labour costs, plus one off cement price hike due to Indonesia's sand ban.
China's voracious appetite for raw materials and minerals caused asset inflation throughout the world and a relentless rise in the Australian dollar due to its huge mineral resources.
At the same time, our construction of the two Integrated Resorts and MRT lines sucked away a lot of construction resources. Nowdays contractors are very busy and even crane operators are earning $8000 per month with overtime.
Can you imagine just the construction cost alone today is equal to the price of entire mass market condo a few years' back. That's not including land costs and developers' margins.
That's why developers are now being squeezed and their share price has fallen a lot.
But if you are holding the end product, i.e. a completed condo unit, then that means you are hedged against further raw material cost inflation.
And if the developers hold back or cancel launches, that means the supply will be even less.
Add to that the 80,000 new citizens and PRs coming in every year, I forsee a potentially explosive situation in the rental market.
The property market has been holding back recently due to the sub-prime issue, like an arrow on bow with a stretched string. Once the sub-prime blows over, the price is going to shoot through the sky.
Awesome analysis.
I can't agree more with you. Your analysis is honest and reflect objectively the ppty market situation in Singapore right now. A lot of ppl tend to ignore this fact and distracted too much by the situation in the global credit market. I believe many will be again caught by surprise when our ppty prices suddenly jump up by another 30% by mid of this year.
I am afraid those who are waiting at the sideline might hv to wait for the whole life. The price for being naive is very costly, "sour grapes".
I appreciate it very much for your analysis but have a question that would like you to think about it. What if the construction cost become lower due to less activities around the world and the sub-prime issue gets worse. Are we still able to hold on to such exorbitant price of new home?
This idiot hacked the forum and erased all the postings.
He still has the guts to come here and post his misrepresentations.
Not so bad lah !!
Don't bullshit, construction cost is not that high. Trying to talk up the price?
80,000 will come. 100% sure ?
Re: Private fund buys remaining 53 Grange Infinite units
Big problem!Where are they going to stay? Hillton Hotel ? Hotel 81 ? Any suggestion ?
Both of you can be assured that unlike the sour grapes, I do not pluck figures out of the air.
Regarding the first question above regarding construction costs, let me refer you to the following extract from The Business Times on 13 Feb 2007.
"CHYAU Fwu Group has unveiled plans for its upcoming super-luxury condominium on Grange Road, called Parkview Eclat, with prices expected to be around $3,000 per square foot (psf).
Construction costs will be $500-$600 psf for Chyau Fwu, which owns the Art Deco-inspired office building Parkview Square at Bugis. This is almost double the industry average construction costs of $300 psf."
Hence the $450 psf quoted by my brother is not unrealistic, considering that most developers, with the exception of SC Global which focuses exclusively on high end properties, undertake a range of projects spanning the mass market, mid market and luxury segments.
Also, notice that this article was published more than one year ago. In the mean time,
1. The full effect of Indonesia's sand ban saw "Concrete now costs as much as $200 per cubic metre, from $70 per cubic metre before the ban." (The Straits Times, 7 April 2007).
2. Steel price (Medium Steel Sections) climbed from USD 735 per metric tonne in Jan 2007 to USD 859 per metric tonne in Dec 2007, an increase of 16.8%.
Regarding the second question on number of immigrants per year, let me refer you to the following extract from ChannelNewsAsia on 27 Feb 2008:
"Last year, Singapore saw over 63,000 new PRs, an 11-per-cent increase from 2006; and the city-state also welcomed more than 17,000 new citizens, a 30-per-cent jump."
Adding 63,000 to 17,000 yields a total of 80,000.
They will come with family, so have to buy or rent as their parent is not here, cannot stay with them.
How much are they going to earn? How many can afford $5,000 per month for rental?
It is true that construction costs have gone up, and that new units have to costs $200-300 psf more. So those who have bought their units in 2006 can charge correspondingly more.
But equally, it would be stupid to go into the market now to take over the inflated costs from someone and run the risk of a property price slide. Even if the property prices don't slide, one may not gain much at this stage.
There would be more opportunities in stocks.
Property market remains sluggish - only half of new units sold in Feb
By Fiona Chan, Property Reporter
THE lethargy in the housing market continued last month, with only half of the new units launched snapped up by buyers.
Property developers launched 343 new homes in February but sold only 185, down from the 328 that they sold in January.
Among the best performers were Cosmo at Guillemard Crescent and Waterfront Waves at Bedok Reservoir.
Cosmo, which was almost sold out within a week of its launch, sold 41 of its 45 units at a median price of $1,098 per sq ft (psf). Waterfront Waves saw 26 units sold at a median $808 psf.
Generally, home prices still held steady, even rising in some cases. Where they fell, the dips were marginal.
At Hong Leong Holdings' Aalto in Jalan Kechil, three units were sold in January for a medain $2,078 psf.
Last month, two units were sold at higher prices: one at $2,336 psf and the other at $2,902 psf.
But prices dropped slightly at Mount Sophia Suites in Sophia Road. Twelve units were sold there at a median $1,719 psf in January, but only five were sold last month at a lower median price of $1,709 psf.
80000 will come 120000 will leave. Pink slips coming big time.
You should better check out the headline in "Business Times" today. It reported that HK had surged by more than 25% for the last 3 months. This is due to the panic buyers who saw by the high inflation coupled with the constant upward rental pressure. Ppl rushed in to buy their own home to hedge against the inflation.
I believe the situation mirror very closely here in Singapore. Ppl should not be distracted too much by the credit crunch in US and missed the big picture. Singapore ppty are going to surge up by at least 30% very soon.
Agree. As long as people got jobs, got pay, they will buy properties to hedge against inflation, either out of fear or greed. The low interest rate environment will be favourable. Stocks will also rise again when people realise money not invested is declining in value by the day because of inflation.
Singapore is not stupid enough to follow HK. We won't panic like them because we have a better government who knows how to manage the economy.
Don't follow Hong Kong as the leading wealth management centre in Asia. Overtake them instead.
I hv no doubt that our govt is good in managing the economy. But to manage individual panic level? Is that also part of their responsibilities? I doubt that is.
What not included here are tax-free foreign investors.
If you look at the recent mad rush for HDB flats, you will know what the real situation is like. These applicants include the majority (I estimate 80%) of the foreign talents who migrated here. They are the HDB class.
What happens to those who are not successful in the balloting for a new HDB flat? They're unlikely to be renting at Ardmore Park or Hilton Hotel.
I also don't see any of them hiding under the canal in Eu Tong Sen Street, while our police after combing the whole jungle only found 66 illegal immigrants.
So where are all our legal immigrants? Hmmm ... that's really an interesting question.
I believe they are probably cramped up in some rented HDB flat, maybe 3 to a room.
What about the remaining 20% who are condo class? They also need a place to stay. They are now caught between a rock and a hard place - to rent or to buy.
If they continue to rent, and there are more and more of them, the rental keeps rising. If they buy, now is the subprime ... so they are nervous. So for the moment, the showrooms have quieten down, but the demand has not. It's building up.
What's happening at the HDB balloting exercise is telling us a lot of things about the growing population in Singapore.
The longer the deadlock in the private property market is, the bigger the pent up demand will be. Sooner or later, they will realise that renting is not a long term solution. The moment the subprime is over, I believe this pent up demand will explode and we may even read of people being trampled in a showroom stampede.
Haha ... you are so cute! You actually cut-and-pasted my post in the other thread "Kuwait fund pulls out of bulk purchase of high-end homes" and quoted it here.
I was thinking ... I remembered I posted this in another thread and not this one.
Well you are right. High networth Singaporeans are not the only ones buying multiple properties. In fact, the percentage of private properties bought by Singaporeans have decreased over the years.
The following picture tells a thousand words.
any event will sure be over, why wait now & fight with others when time comes?
how long subprime will be over? soon, 2-4 months time due to US election in Nov. If not resolved by then, Bush & Mccain, sure lose, no need to contest. You know how hard people fight for 'US president' position.
Demand is building up, like a burst of water pipe, when the timing is ready, pressure is building up everyday.
why sell now? hold on, with strong rental yield, rent out for 2 years of 5% return, pay loan rate at 1.68%. With building cost at sky high due to no capacity & tight labour supply, developers & HDB will either slowdown, supply, slowdown building speed OR sell at high price due to cost.
Problem now is who can wait longer? big developers are so cash rich due to last 2 years big profit, no problem for them to hold for 20 years. Of course, nobody will wait that long,only wait for subprime issue to be over.
Bear Stearn collapsed, DOW still up 21pts last night, we can see the market strength, people is starting to see value & come in to buy.
Oil, gold, commodity all drop big time last night, a reversal is coming on the way with people taking profit in commodity after a big run of gold from US$650 to US$1025, oil from 70 to 112, sugar & coffee drop >10% last night. Profit from commodity will put in stock & property again in coming months plus all the US$trillion pump in from center banks across the world, tons of liquidity is going to flood in again.
It's already happened in HK. Pressurized by escalating high inflation coupled with sky high rental rates, hv caused ppl to jump in to buy ppty. Over there, ppty prices hv jumped up by more than 25% for the last three months. Analysts said the price level today hv far exceeded its peak in 1997.
Very soon, Singapore will face the same issue. Some might still try to argue that we are different because our govt will manage the situation and curb the prices from escalating. Which I totally disagree. Because if that is the case then we will distort the free market mechanism and badly tanish our reputation as an open economy. I don't think our govt wants to take this path and risk our economy competitiveness ranking to be degraded next year.
Some developers are in fact preparing to hold for 20 years.
CDL/Hong Leong's Kwek Leng Beng recently made some remarks about regretting selling away all his developments and now have to buy them back from the en blockers.
On 8 Mar 2007, CDL/Hong Leong bought back Hong Leong Garden at West Coast for many times the price they sold off to investors/speculators 25 years ago.
Having learnt the lesson, a joint venture between City Developments Ltd and US-based Wachovia Development Corporation is buying two blocks at CDL's Cliveden at Grange condo for $432.4 million or an average price of about $3,750 per sq ft. CDL executive chairman Kwek Leng Beng said that the deal attests to the freehold project's 'high investment potential' and reflects CDL's 'business strategy of leveraging on the capital appreciation potential of our developments'.
Do those words highlighted in red above show a tinge of "sour grapes" at the en bloc profits that investors/speculators made from his father when they bought into Hong Leong Garden 25 years ago?
Developers are wising to the fact that they are giving money away to people who buy into their projects. So nowadays, they keep some units for themselves.
Another tycoon who is keeping his property for posterity is UOL's Wee Cho Yaw. Last year, he redeveloped his flagship buidling at Somerset Road into serviced apartments to be rented out on a weekly to monthly basis, instead of luxury apartments to be sold at sky high prices. In this way, his family will continue to hold on to this piece of property so that 25 years from now, his children/grandchildren may benefit from revised plot ratios around Orchard Road MRT area, which will possibly rise from the current 4.2 to 5.6 range to more than 10+, in line with Shenton Way/Robinson Road areas.
This is the right approach. You only need to make a call to your broker and 'its done'.
You are on the wrong track. The idea is because the Singapore government is good at managing our economy (unlike that mad HK copycat who keeps posting crap about HK), people here generally do not panic.
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