I share what you feel. 1600? Dun think we will go down to that level againOriginally Posted by vin002
Junior
I share what you feel. 1600? Dun think we will go down to that level again
Newbie
This is just what I am told by a single agent. You make of it what you want. I'm not buying into it fulltime but it's something to keep in mind.
But there were launches around river valley that were unsuccessful in 2008 that have restarted at lower levels and then slowly increased.
How should these be considered. Price cut or price increase.
Newbie
hi,
I assume that as part of the strategy it was agreed that defaulting property purchasers would be helped by the banks/developers towards solvency, in a falling market to avoid a stampede for the exit. Agents have also helped by steering such defaulters towards an orderly and respectable selling at auction.
Nobody wants to see the price falls of Q1/09 repeated.
Developers can then offer tiny units at tempting prices, and it works. Stability maintained, then start on the price increases for choice units, and price increases for new launches.
Developers can also off-load tail-ends, clear the back-log and use this to maintain turn-over.
Private sellers catch on and with declining rentals put properties on the market.
After all, with Singapore's declining export market, what else is there to sustain the economy beyond government spending. It'll work as long as it can all be kept going till the world economy substantially improves, or the IR's come onstream.
Junior
in other words, buyers must be fools and continue to be fools for some time for the economy to be kept on a even keel.
Newbie
for new developments, many agents collect cheques for booking of units. once cheques collected, it is deemed that they have closed a deal. Half of those who issued cheques could back out and forego the unit if they decide to do so.
Newbie
Not really. Depends on where you're standing.
After all, if you've got money on deposit you'll get 0.8%. If you want to take a punt then put some of the cash as a deposit and use IAS/DPS and get 2 years for the market to go up before TOP. Or meanwhile try and flip.
I've been looking to buy the past few weeks. My own circumstances lead to the conclusion that it's best for me to buy an older apartment, as large as possible, and with a 10 to 15 year horizon leading to en bloc. As the unit will be large (say, 1600 square feet) I can rent it out very, very competitively - even at HDB levels. Enough to cover expenses.
You can still pick up LH apartments in 15 years old units at 450 to 500 per square foot.
However, the sellers have raised prices the past 6 weeks so I'm waiting for a downturn.
But I'm easygoing about it. This is an investment, if I miss out, fail to grab, whatever, it doesn't matter - something else will come along sometime.
BTW - although it's an investment I'm making sure that I really like any unit that I buy as I may have to live in it.
Newbie
IMHO, I wouldn't say that buyers are fools. In fact I never call anyone a fool as we're all clever enough to survive, day-by-day, in this stressful world.
Buyers are making a choice. Prices are mainly lower this year than 2007. It all started with the Caspian being offered at 580 psf. It's gone up fast which usually means a correction.
I think that the building, construction, property market is one part of the governments strategy towards keeping the country stable and balanced during a world crisis. You'd probably do the same.
It must have been scary for the authorities to see GDP crashing, bank shares crashing, STI at 1500, and property crashing all at the same time in Q1/09.
The economic stimulus package is working. It'll take time. But it makes the recent property price rises look "not right" as another person posted earlier.
Junior
prices do not "look right" bcos some sellers r asking peak prices of 07 or early 08 level.. maybe these sellers missed their exit opportunity the last round so is getting out now..
end of day, willing buyer willing seller ~ lol
Junior
Just like stocks, smart buyers do not commit all his funds into properties one shot !!! Say you want to buy 7 properties, you will first buy 4 properties, when market clears a significant resistance (say private residential index at 180 is broken or supply drawn down with high volume), you buy another 2 units. And your last buy may be a small studio somewhere when index at 200. So when you decide to sell, you will sell off 7 properties in one shot when index is at 220 or STI at 4,800.
Obviously, if you want to exercise such strategy, you need to be rich, have the holding power.
Only fools will commit 7 properties at one shot, near the peak
Last edited by jitkiat; 24-06-09 at 15:49.
Just my 2 cent worth..
yeah, just that each party has their own hidden agenda..
end of the day, it is those who buy high that suffers.. and as long as these are "private buyer"...
Junior
I am sure a lot of investors who jumped into the market recently are going to regret at the end of the year when the green shoots turn out to be poison ivy, and the market nose dives.
while one does not wish for that to happen. It seems likely the current recovery in market sentiment is based on wishful thinking of a V-shaped recovery in economic conditions. it will probably not be a V but rather W or L-shaped recovery. A lot of investors are going to be hurt, which will in turn drag down the banks.
Junior
unlikely to happen. becos the government wont allow property market to crash due to many reasons thats why the developers become very ya ya to keep increasing the price
Junior
In a country like Singapore, if properties crash even 50%, it would be a total disaster. Imagine how much CPF is tied to properties, how many bank loans using properties as collaterals are out there. Just think of Japanese style deflation after its property bubble burst (Nikkei peaked at 40,000 and today still at 10,000). Singapore cannot afford to have lost decades. That's why government has all kinds of weapons (indirect control via HDB BTO, stamp duties, property tax, land sales to name a few) to use at the right time. Even for rental market, government can enforce non-partitioning rule to prop it up.unlikely to happen. becos the government wont allow property market to crash due to many reasons thats why the developers become very ya ya to keep increasing the price
Last edited by jitkiat; 24-06-09 at 18:27.
Junior
yup tats basically sum up why property prices will be supported and keep going up
Newbie
JitKiat,
It's not as if this has not happened before.
I nearly bought Parc Oasis in 1996. 800k for 99yr in jurong. For most of the next 10 years they were going for around 400k for 1200sqft.
Almost 1000 units in just that development.
Glad I didn't. Just waited 1 year and for even less money bought a unit at Grangeford.
The place I stayed at before Grangeford was the site of the new Devonshire one. That went enbloc in 1998 or 1999. Has been empty until 1 year ago and only just started building now.
HDB in Bishan was also fetching 500k in 1996. I heard so many people say HDB can never come down
How much was it for the subsequent 10 years?
These sound like lost decades for real estate anyhow.
There's only so much the government can do. Total real estate value of all of Singapore must be in the 100's of billions if not trillion. Can they afford to prop up such a market? The track record says they can't or wont, even going so far as to warn Singaporean in the height of the bubble in 2007/8 that speculators wont get bailed out.
Are things the same now as the last time around. No they never are. But new fault lines can appear. & most of the measures you mentioned they had last time around. I think the only one that's new is HDB BTO.
Just be wary the moment you hear "this time it's different...."
I just went to look at Valley Park this evening. The owner is asking 10% premium over the lastest transaction.
I am in two minds as to whether to buy or not at this moment. It's not as straight forward as you may think. There are certainly no guarantees.
Senior
You must be old enough to be my father man. 1996 was just 1 year after i completed my NS.
Junior
Agree with your assessment. However, I also think it was partly the SG government fault back in 1996. The SG government should have introduced the special tax to punish the speculators in early 1995 when the private residential index was still below 140. From a technical charting perspective, the property index fair value should be only about 110 in 1995/96. Instead, the government allowed the index to reach 180 in 1996 before introducing speculative tax. The subsequent bubble bursting dragged the index down to 100. Many ppl I know bought in 1996 continued to hold till 2007 before they can sell at a slight loss. One case was an HDB in TPY bought at 550k, another was a landed property bought in Serangoon for 1.2mio, yet another case, Gillman Height HUDC bought at 900k+.
Junior
Talking about bubble, quoted from Wiki:
Prices were highest in Tokyo's Ginza district in 1989, with choice properties fetching over 100 million yen (approximately $1 million US dollars) per square meter ($93,000 per square foot). Prices were only marginally less in other large business districts of Tokyo. By 2004, prime "A" property in Tokyo's financial districts had slumped to less than 1 percent of its peak, and Tokyo's residential homes were less than a tenth of their peak, but still managed to be listed as the most expensive in the world until being surpassed in the late 2000s by Moscow and other upstarts.
93k psf ...
Newbie
I bought a large unit at Shelford Apartments in 1985 at S$325,000. I kept it and rented it and it went on en block in the 90's for 2.1M.
I bought a 2100 sq.ft. unit at Pandan Valley in 1986 for S$375,000 and sold for S$802,000. It's now worth over 2M.
I bought Watten Hill, 2600 sq.ft. in 1990 for S$730,000 and, luckily, sold for 1.53M in 1996 - just before the crash. A town house at Watten now goes for 2.2M.
My 5-room HDB was bought in 2005 for S$273,000 and it's now valued at S$385,000.
In 2005 it very clear that prices were about to take off. Now, in June 2009, the direction is very cloudy.
These units were bought privately, all older properties, all the maximum that I could mortgage, and all bought with years as a time frame.
In 1985 Singapore's population was 2.34M, now it's 4.8M.
In 1985 Singapore's land area was 680 sq.km, now it's 710 sq. km.
In 20 years time whatever you buy now will be worth more. Maybe a lot more, maybe an enormous amount more, but certainly more. Plus you can live in it, or rent it.
So what we're talking about is timing rather than appreciation, plus what are the alternative uses of your money. To me, it feels wrong at the moment. But I'm tracking several units.
And it's interesting to read the views here. For example, the comment by August :
I think that this is another grain of truth/insight to add to the total. Let's keep it coming.prices do not "look right" bcos some sellers r asking peak prices of 07 or early 08 level.. maybe these sellers missed their exit opportunity the last round so is getting out now..
Caveat emptor.
Last edited by scott7777; 24-06-09 at 22:49.
Junior
Someone posted this at WFW thread, reposted in this thread as it is worth reading:
http://forums.condosingapore.com/att...5&d=1245852963
Just my 2 cent worth..
In general, government uses HDB to indirectly control the mass market property price, setting CPF and loan regulation to control property speculation by lower and middle class. this is to restrict and protect the lower and middle class from losing too much $$. Private condo price can only be control to a certain level, it is still very much a free market based on supply and demand, and of course sentiment (like now).yup tats basically sum up why property prices will be supported and keep going up
It is a mistake to think that government will support the market to go up, because middle and upper class, if they lose $$, they can still survive with their knowledge and capability and doesnt overburden the government.
Government's job is not to ensure greedy ppl continue to make $$. they are more concern that the housing inflation will cause mass market property price to be unaffordable, and that will cause lower rung population to not able to afford a property. BUT they cannot stop the greedies from buying at high price, they can only advise ppl that this is not a V shape recovery.
The market has to correct by itself. those who buy at high price will be the one who suffer.. and dont blame the government then.
Newbie
I was 25 back in 1996, if I am old enough to be your father, I guess I must have been very active at 4 years old!
Senior
i think at the rate things are going (1200 and above units a month), government might step in and say something sometime in August or September to cool things off. But not before more developers are allowed to clear stock between now and then.pent-up demand should be filled up by then and speculation would have correspondingly increased in proportion.
In general, government uses HDB to indirectly control the mass market property price, setting CPF and loan regulation to control property speculation by lower and middle class. this is to restrict and protect the lower and middle class from losing too much $$. Private condo price can only be control to a certain level, it is still very much a free market based on supply and demand, and of course sentiment (like now).
It is a mistake to think that government will support the market to go up, because middle and upper class, if they lose $$, they can still survive with their knowledge and capability and doesnt overburden the government.
Government's job is not to ensure greedy ppl continue to make $$. they are more concern that the housing inflation will cause mass market property price to be unaffordable, and that will cause lower rung population to not able to afford a property. BUT they cannot stop the greedies from buying at high price, they can only advise ppl that this is not a V shape recovery.
The market has to correct by itself. those who buy at high price will be the one who suffer.. and dont blame the government then.
Newbie
I'm wondering if whatever the govt says would affect the market. Like now, PM says recovery is a "big fat U" but property prices keep increasing, s'poreans keep shopping.
Senior
I agree that its going to be a big fat U, although we r now at the starting part of that bottom of the U, economy-wise, we could stay at that bottom of the U for quite awhile. sooner or later, property prices (market forces) will realise that and stop rising, whether it will go back down (to form a W as Nomura says) or not is another thing depending on the market conditions then.
Junior
sometimes a bubble burst is good. If not some people will not get the property they want at a cheaper price.
Newbie
I agree with the statement. But previously, the govt fault was the over supply which they have learnt the lesson.Agree with your assessment. However, I also think it was partly the SG government fault back in 1996.
Trust me, when that happened, it will only be good for some people. Majority will suffer. Do you think property will be at the mind of people then? It will only be bread and butter.sometimes a bubble burst is good. If not some people will not get the property they want at a cheaper price.
Junior
Judging from this graph, i think we are short of supply for new HDB flats
Newbie
Not shortage but controlled supply (BTO). In 2000 to 2003, there are plenty of walk in selection. However, currently, the walk in supply are so limited.
With now the critical period for economy is to recover. If Govt pump in more supply to create an over supply situation, private property sector will be hitted badly. This will mean that credit crisis yet to calm down, create another crisis.
Newbie
yah, esp some people who missed the boat totally. a lot of such people in this forum. probably talk a lot but no action till market cheong then hope market will drop back again
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