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Thread: Threat to Singapore property, very silly of opposition parties.

  1. #1
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    Default Threat to Singapore property, very silly of opposition parties.

    Threat to Singapore property, very silly of opposition parties. Opposition parties suggest stop population inflow. They just say because people like to hear but they never think deep what it can cause.

    Read this by business times:



    The Business Times
    Lee Meixian



    IT is a hypothesis that could colour the common perception of the viability of property as a long-term asset to hold in Singapore:

    A recent study by the National University of Singapore's Institute of Real Estate Studies predicts that Singapore home prices could fall by about 30 per cent by 2040 as the society ages and the old-age dependency ratio rises.

    But economists and real estate consultants argue that this scenario may not come to pass because of investment and immigration flows. They say that the study by and large approaches residential property as a consumption good, ignoring the investment part of the equation, which should not be the case, given Singapore's status as a global city.

    The working paper by a team led by Chihiro Shimizu, to be published next week, covered 12 Asian, five South and Central American and 18 European economies. It forecasts that, in ageing European and Asian economies - including Singapore - housing prices will drop as a result of demographic changes in the next 30 years.

    This conclusion is not new; it has been much debated in US academic literature, but not many such studies have been done in the Asian context, noted DTZ regional head of research Lee Nai Jia, who was formerly an assistant professor in the Department of Real Estate at NUS' School of Design and Environment.

    The researchers behind the study expect the old-age dependency ratio - defined as the proportion of the elderly to the working-age population - in Singapore, Korea, Hong Kong and Thailand to rise from between 10 and 20 per cent to between 40 and 60 per cent in the next 30 years; in China, the proportion of the aged is expected to grow from 11 per cent to 35 per cent.

    The expanding ranks of the aged could in turn send home prices down by 50 to 60 per cent by 2040, it said. However, Singapore will buck the trend, in that its home prices could fall by less - 30 per cent.

    The reason for this disparity comes from the study's assumption that the populations in other countries would stay somewhat stagnant, while Singapore's total population is expected to grow 36 per cent from 2010 to 2040, culminating in a population of 6.9 million - the figure used by the Singapore government for infrastructure planning purposes.

    The projected growth in Singapore's population would have the effect of offsetting some of the housing demand lost from a more aged population, it said.

    While the study focused primarily on Japan, where the population is greying and declining faster than anywhere else, it found that the empirical model continues to yield similar trends when extrapolated to other countries.

    The paper explained that working-age people tend to trigger demand for housing because they typically build up assets during their prime years, and then consume their savings when they enter their senior years.

    "During the asset-formation period, housing assets are considered to be a safe asset for people since they lose little value due to inflation, compared with savings. Houses may eventually be passed onto one's offspring or sold and the profits allocated to expenses in one's old age."

    It added: "In an economy comprising these two generations, if life expectancy continues to increase without the social welfare system developing to accommodate it, working-age people will act to reduce their current consumption in preparation for post-retirement life."

    This is how a longer life expectancy can cause a fall in the consumption level of society as a whole; in addition, because the elderly depend on those who work for a living, a larger elderly population would make the overall economy less active.

    DBS economist Irvin Seah said the research debunks the misconception that property prices are a one-way bet: "That assumption essentially forgets that demographics do have a significant impact and can eventually take a toll on residential prices."

    But other observers believe that immigration and offshore demand will create new demand to fill the gap left behind by the aged. (In fact, the report recommends that Japan start accepting more immigrants to arrest price declines.)

    Mizuho economist Vishnu Varathan said the report under-accounts for Singapore's position as an investment hotspot. He added that Singapore does not have very many cheaper housing alternatives such as cheaper rural farmland, so prices will tend to be stickier and better supported.

    He also pointed out that it is slightly tricky to predict where the dependency ratio will be in 30 years because a large part of Singapore's population is inorganic.

    Permanent residents and non-residents make up about two-fifths - nearly half - of Singapore's population, for instance, which makes simple extrapolation from the current population make-up difficult.

    The study, referring to economies outside Asia, predicts that the dependency ratio will rise from about 20 per cent to 40 per cent in Oceania and North American countries. But the impact on residential prices are "not as serious" in these countries because their populations are expected to grow 20 to 30 per cent.

    In European countries, the dependency ratio is expected to rise from between 20 and 30 per cent to between 30 and 50 per cent, leading home prices to fall.

    The declines are mostly capped at 20 per cent, but could be deeper in Germany, the population of which is ageing and shrinking; prices there could plunge more than 40 per cent.

  2. #2
    xebay11 is offline New Launch Project Specialist
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    But high property prices only benefit the rich and those with multiple properties, the common man with only one property does not benefit at all.
    Quote Originally Posted by polarinda View Post
    Like i said, i can live in London now with my child in an international school but that would mean my Spore end of the business chain has to be somehow diverted there.
    Living in JB is for convenience
    What a pathetic excuse for an inbred retard bringing up successive generations of retarded offspring who need to attend play school instead of a real school, runs a kachang puteh business and whole family have to stay in backwater JB for convenience.

    Well done!!!!


    Quote Originally Posted by polarinda View Post
    My wife owns her own boutique lines. She has more balls......
    Contradictions, contradictions, polarinda proudly tells the world he owns 10 properties internationally and yet the "wife" with balls must still work.......oh yah maybe he eats soft rice and the "wife" wears the pants in the house too.

    My wife has guts, polarinda's has balls.....

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    Bro, paying for 20 yrs loan or 30 yrs loan for Property with interest rate is no joke. Everyone want to get some profit for their property down the road.

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    Bro, even if u do not sell off u can always leave property to your children next time after we pass away. It will also benefit your children.

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    Your children can cash it out too. They can upgrade to a bigger better home.

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    Quote Originally Posted by xebay11 View Post
    But high property prices only benefit the rich and those with multiple properties, the common man with only one property does not benefit at all.
    Master Xebay, did any Govt in the world forbid common men to buy lands and Properties?

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    Quote Originally Posted by Citizen View Post
    Master Xebay, did any Govt in the world forbid common men to buy lands and Properties?
    Master Xebay please dun get me wrong , I m also MTB and resentful.

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    Hong kong property will not die because they got china support. For singapore people just don't realise if i intend to open a company with 300 workers but need to work weekend and shift where to find? Lets say 50% female dont work shift or weekend left only 50% males and some also don't work on weekend or shift. So i will not even set up my company here. It cost job opportunity for singaporeans too.

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    Not true, LKY said rising tide lift all boats.
    The poor has no asset except their roof, so property price rise help them to retire comfortably.

    Quote Originally Posted by xebay11 View Post
    But high property prices only benefit the rich and those with multiple properties, the common man with only one property does not benefit at all.

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    what if properties are not considered as assets but as expenses?
    what if the monthly mortgage payments are considered as expenses, ie rental?

    why would anybody want to pay more expenses?

    1) transport price hikes, people complaint
    2) gst hike, people complaint
    3) kopi-o price increase, people complaint

    but why monthly instalment (rental) increase, people no complaint?

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    tighten inflow, many old folks ask who to rent their rooms..

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    Quote Originally Posted by DMCK View Post
    tighten inflow, many old folks ask who to rent their rooms..
    Ya lor, more immigrants people complain that they come in to "steal" their rice bowl. No immigrants, company complain not enough labours to work OT or owners complain nobody to rent their house, sign...... In that case, what the government should do, can the opposition able to solve this problem also? You please one but offend another one, just like Thailand, Yellow and Red shirt, maybe ours is Black and White shirts.

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    Blue and White. The other rainbow colours not counted, yet.

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    Quote Originally Posted by DMCK View Post
    tighten inflow, many old folks ask who to rent their rooms..
    Singapore cannot stop inflow, only tighten.

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