Should we sell?

[chestnut]

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]

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.

[DC33_2008]

My agent said it is a good buy. There are still quite a lot of wealthy people around. What is the sentiment?

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???

[chestnut]

My agent said it is a good buy. There are still quite a lot of wealthy people around. What is the sentiment?

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]

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.

[smartboy2]

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]

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]

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.

[Juniper]

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.

[august]

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?

[chestnut]

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]

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?

[amk]

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.

[chestnut]

... 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]

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...s-selling.html

[teddybear]

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!

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...s-selling.html

[Londonproperty123]

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!

So you think that all the reports on China's impending credit crunch are baseless?

[chestnut]

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]

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!

....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

[johnlee]

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 ...

[teddybear]

Wee Cho Yaw do sell.....
He build and sell the lousy assets while holding his prime assets tight tight.............
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 ...

[Maxim1]

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]

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.