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Thread: When will Market Crash?

  1. #1
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    Default When will Market Crash?

    When will we see a correction?

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    Correction will be on the way after election :P

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    Quote Originally Posted by Property_Owner
    When will we see a correction?
    correction will come when US, Europe starts their solid recovery...

    investors who have dumped money in Asia/Singapore (solely in residential) will exit as soon as they see strong sign of US/Europe recovery.. that will be the chance for them to leave (take profit) asia, esp singapore, and enter US/EUR as they are still very cheap.

    already seeing some of my friends started to buy London .. and NY .. 1 or 2 units ..when it starts to rise further ..they will exit spore .. .

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    Don't think soon. During the last 20 years in properties, prices only drop when there is a major crisis. Even 9/11 didn't affect much. Or can I say, even 1997 Asian financial crisis only crash for 2 quarters before a V recovery.

    From 2003 (SARS) to 2006 is different case. Downturn + oversupply of HDB. But after HDB clear their stock in 2006 and IR announced and economy going very strong, we saw the massive increase. Likewise, even the US subprime only cause 4 quarters of decline and a strong V recovery. So just look out for the next crisis or HDB oversupply.




    Quote Originally Posted by Property_Owner
    When will we see a correction?

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    But now hdb is build to order, can oversupply meh? Last time was build finish then sell, end up too many empty flats.

    But my guess is the next crisis will be 2012 or 2013.

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    Quote Originally Posted by Squall8888
    Don't think soon. During the last 20 years in properties, prices only drop when there is a major crisis. Even 9/11 didn't affect much. Or can I say, even 1997 Asian financial crisis only crash for 2 quarters before a V recovery.

    From 2003 (SARS) to 2006 is different case. Downturn + oversupply of HDB. But after HDB clear their stock in 2006 and IR announced and economy going very strong, we saw the massive increase. Likewise, even the US subprime only cause 4 quarters of decline and a strong V recovery. So just look out for the next crisis or HDB oversupply.
    You are right. People are getting more and more immune to all these crises.

    After the 1997 Asian Financial Crisis and 2008 Lehman Brothers crisis, I don't think there is anymore crisis of a financial nature that will cause people to panic anymore, after seeing that those who panicked and fire-sold their properties ended up as fools.

    However, there remains one more crisis which may be able to defeat Propertism. That's why I keep some investments in gold, just in case.

    I feel this crisis will happen within the next 10 to 20 years, depending on how fast Osama and friends work.

    Read the scenario at this website: http://www.atomicarchive.com/Example/index.shtml

    New York City Example


    A 150 kiloton bomb constructed by terrorists is detonated in the heart of Manhattan, at the foot of the Empire State Building. The bomb goes off without warning at noon time. It's a clear spring day with a breeze to the east.
    Assumptions
    • There is no warning. The population has not been evacuated nor sought shelter. Both measures could reduce casualties.
    • There is clear weather, with visibility of 9 miles (16 km).
    • This is an isolated attack, leaving the rest of the country free to respond.
    • A large percentage of the day time population is outside - 25%.
    • The daytime population density is roughly uniform and about 125,000 per square mile.
    • The shock wave will spread out uniformly in all directions, being minimally affected by structures.
    New York City Example: 1 second after detonation



    Blast Wave

    At the end of the first second, the shock wave will have an overpressure of 20 psi. at a distance of four tenths of a mile from ground zero. Even the most heavily reinforced steel and concrete buildings will be destroyed. These buildings include the Empire State Building, Madison Square Gardens, Penn Central Railroad Station and the New York Public Library. Most of the material that comprises these buildings will remain and pile up to a depth of hundreds of feet in places, but nothing inside this ring will be recognizable.

    Casualties

    This circle contains a daytime population of roughly 75,000. There will be no survivors. Those caught outside will be exposed to the full effects of the blast, including severe lung and ear drum damage and exposure to flying debris. Those in the direct line of sight of the blast will be exposed to a thermal pulse in excess of 500 cal/sq.cm., causing instant death. Those inside, though shielded from some of the blast and thermal effects, will be killed as buildings collapse.


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    Quote Originally Posted by azeoprop
    But now hdb is build to order, can oversupply meh? Last time was build finish then sell, end up too many empty flats.

    But my guess is the next crisis will be 2012 or 2013.
    My guess is abt same as you. 2012/13 might see an over supply

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    Oversupply isn't really a problem. Let me tell you what is the real killer.

    INTEREST RATES

    What I meant is FOMC and ECB's benchmark rates, not our puny SIBOR. Our SIBOR affects nothing since borrowers of SGD are usually homemakers constituting to actual demand but FOMC and ECB's have a great effect on speculation since the current ultra low rates made borrowing in USD and EUR cheap thus creating a carry trade with currencies of better return.

    Now you understand why I said oversupply and bank loans are not the main killer. The property market is flushed with cash from US and EU and these people are the real speculators. However, I think the effect in SG is still very limited as we are not seeing a large percentage of foreign buyers. HK is the real problem as properties there are bought in USD.

    I estimate that FOMC and ECB should be raising their benchmark rates second half of 2011. Higher interest rates send these speculators fleeing with their money since the carry trade is now reversed.

    Singapore Property Crash? Not likely. HK Property Crash in 2011? HIGHLY POSSIBLE!
    Last edited by pmet; 13-03-10 at 04:28.

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    Quote Originally Posted by pmet
    Oversupply isn't really a problem. Let me tell you what is the real killer.

    INTEREST RATES

    What I meant is FOMC and ECB's benchmark rates, not our puny SIBOR. Our SIBOR affects nothing since borrowers of SGD are usually homemakers constituting to actual demand but FOMC and ECB's have a great effect on speculation since the current ultra low rates made borrowing in USD and EUR cheap thus creating a carry trade with currencies of better return.

    Now you understand why I said oversupply and bank loans are not the main killer. The property market is flushed with cash from US and EU and these people are the real speculators. However, I think the effect in SG is still very limited as we are not seeing a large percentage of foreign buyers. HK is the real problem as properties there are bought in USD.

    I estimate that FOMC and ECB should be raising their benchmark rates second half of 2011. Higher interest rates send these speculators fleeing with their money since the carry trade is now reversed.

    Singapore Property Crash? Not likely. HK Property Crash in 2011? HIGHLY POSSIBLE!
    Also refer back to my post earlier ...
    + your interest rate rise
    + over supply ...
    + people sick of child's play casino in spore ...the hype dies off .. then thats it ..

    i am not attempting to play down the prop mkt .. but the above points are very real

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    hope the government stops playing with the property market or blood will be shed after the GE

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    Some stats and you draw your own conclusion :

    80% of properties are hdb.

    HDB did 13,000 BTO in 08.

    No of marriages in Singapore ave 24,000

    Can you imagine how many married couples still do not own hdb? Over the last few years, foreign workers have been flooding and taking up resale hdb. Do you think hdb will build more flats to cater to masses? Do you think hdb will sell cheaper in the next few years? Do you think hdb prices will drop?

    The increase in prices are either bottom up or top down... In 2005, it was top down... Orchard road started first and this caused a spill over the rest of the market. In 2009, it was bottom up... HDB climbed, resulting in private moving up....

    I dont see a crash, maybe a correction from an economic issue ... job losses, another recession, etc... but if you look at the supply/demand.... The demand is more than supply.... Just imagine, if 5% of the hdb population wants to upgrade to private, what is the number translated to? And if you look at the previous cycle, when do they want to upgrade? Is it when their hdb is under water or when they are making money???? The question is when to pull out when there is a correction. That is the million dollar question. I had a friend who sold his Katong semi-d in 1991 for 500k in anticipation of a drop and started renting.... Guess what, waited until he finally got a small apartment in 1996 and the rest is history...

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    xebay11 is offline New Launch Project Specialist
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    Quote Originally Posted by chestnut
    That is the million dollar question. I had a friend who sold his Katong semi-d in 1991 for 500k in anticipation of a drop and started renting.... Guess what, waited until he finally got a small apartment in 1996 and the rest is history...
    Alamak propertism lecture coming liao.

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    [quote=chestnut]Some stats and you draw your own conclusion :

    80% of properties are hdb.

    HDB did 13,000 BTO in 08.

    No of marriages in Singapore ave 24,000

    Can you imagine how many married couples still do not own hdb? Over the last few years, foreign workers have been flooding and taking up resale hdb. Do you think hdb will build more flats to cater to masses? Do you think hdb will sell cheaper in the next few years? Do you think hdb prices will drop?

    quote]

    good question

    if there are that many couples who still do not own HDB ... and their salary is not catching up with inflation, and prices are running higher at 10-20 pct per quarter ... do you think they will be able to afford condos?

    or will they complain and vote Against PAP ?

    i dont think prices will crash .. but it should stabilise .. and not run at 10 pct rise with every transaction ..

    at this point in time .. i strongly believe there are MORE units than owners.. i believe there are many owners with mulitple units, due to low mortgage rate, people are buying .. along with kiasuism and herd instinct

    the day global rate rises, investors exit singapore properties, we will see many owners holding on to more than they can handle ..

    i dont preach buying now, nor selling now .. just KEEP only to what you really can afford ..and not be greedy .. and DONT follow the butt in front of you .. like a in herd

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    Quote Originally Posted by pmet
    hope the government stops playing with the property market or blood will be shed after the GE

    the govt doesnt play the mkt directly, however it is needlessly supportive of certain local developers ..

    in Spore the relationship between govt, banks, and developers is too cosy ~

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    Quote Originally Posted by proud owner

    good question

    if there are that many couples who still do not own HDB ... and their salary is not catching up with inflation, and prices are running higher at 10-20 pct per quarter ... do you think they will be able to afford condos?

    or will they complain and vote Against PAP ?

    i dont think prices will crash .. but it should stabilise .. and not run at 10 pct rise with every transaction ..

    at this point in time .. i strongly believe there are MORE units than owners.. i believe there are many owners with mulitple units, due to low mortgage rate, people are buying .. along with kiasuism and herd instinct

    the day global rate rises, investors exit singapore properties, we will see many owners holding on to more than they can handle ..

    i dont preach buying now, nor selling now .. just KEEP only to what you really can afford ..and not be greedy .. and DONT follow the butt in front of you .. like a in herd
    100% with you.
    How many are thinking they are smarter than the rest & can get out at quickly as interest rates rise - which at some point has to happen.

    Interest rates & price appreciation both of which are far from the historical averages. Reversion to the mean always happens - no matter who tells you "this time it's different".

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    Quote Originally Posted by Property_Owner
    My guess is abt same as you. 2012/13 might see an over supply
    so is mine. I think beg of 2012 should start to dip.
    I plan to exit by mid 2011. Between now and then, there are still money to be made
    Repeat after Quek: "sell on the way up , as you can never catch the peak" (sorry jlrx, after all your preaching I'm still not yet converted )

    as a side note, not too many ppl here are old enough to remember 1996/7.

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    [QUOTE=proud owner]
    Quote Originally Posted by chestnut
    Some stats and you draw your own conclusion :

    80% of properties are hdb.

    HDB did 13,000 BTO in 08.

    No of marriages in Singapore ave 24,000

    Can you imagine how many married couples still do not own hdb? Over the last few years, foreign workers have been flooding and taking up resale hdb. Do you think hdb will build more flats to cater to masses? Do you think hdb will sell cheaper in the next few years? Do you think hdb prices will drop?

    quote]

    good question

    if there are that many couples who still do not own HDB ... and their salary is not catching up with inflation, and prices are running higher at 10-20 pct per quarter ... do you think they will be able to afford condos?

    or will they complain and vote Against PAP ?

    i dont think prices will crash .. but it should stabilise .. and not run at 10 pct rise with every transaction ..

    at this point in time .. i strongly believe there are MORE units than owners.. i believe there are many owners with mulitple units, due to low mortgage rate, people are buying .. along with kiasuism and herd instinct

    the day global rate rises, investors exit singapore properties, we will see many owners holding on to more than they can handle ..

    i dont preach buying now, nor selling now .. just KEEP only to what you really can afford ..and not be greedy .. and DONT follow the butt in front of you .. like a in herd
    You see, 80% of the people are in hdb - about 800,000 hdb flats.... This people want to see their hdb price rise.... When it rises, they will jump into private (which is most of the people's aspiration - which is by no means wrong). This couples who cannot cannot get hdb only form a minority.

    I am not here advocating the purchase of properties, but just discussing these based on analysis.

    In fact, in 1997, I was holding 2 properties (one for own stay and another rented out). In 2003, the value of both properties were down 700k in total. Can you imagine how I felt then??? So in buying, you have to buy when people are not looking - show flat empty (which I did in 2006 - again, imagine how one feels when nobody buys and you buy). I now have a couple of units. I believe the pricing from here on will be gradual (no more double digit percentage growth yoy. Which is the reason why I do not feel there would be a correction... But I do intend to offload 1 or 2 units when long queues start forming and people sell their queue number for a few k (at new launches)... To me, this is the sign of a bubble forming...

    this forum is just a platform to discuss... Buying and selling is still up to the individual... I see a crash if the property market grows at 30% pa. The govt has learn from history which is the reason why BTO is in play for hdb, measures are put forth for the private sector. The days of 80% growth is over.

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    Quote Originally Posted by xebay11
    Alamak propertism lecture coming liao.
    I am not preaching.... I am just giving a reminder to people who only have 1 unit and there believe 2012 will correct.... They sell and then what if it does not correct???

    How many of you sold in 2008 and bought in 2009???? How many of you expected the property to continue to drop all the way thru 2010???? No one can predict correctly but we can speculate... I believe you have to buy properties within your means and I really do not wish to see anyone go thru what I went thru in 2003 (700k paper losses). Lucky for me, the bank did not ask for top up??? Do not over leaverage....

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    Agree. You can only play the game if you have more than one property. I will always keep my owner occupied property which I fondly call home. I think people should treat their primary abode as their home and not sell and rent and wait for market to crash

    I think it would be very interesting once all the mickey mouse units TOP. Clearly almost all of them will enter the rental market and ang moh tenants don't like small units as it cramps their creativity. So it would be interesting to see how these units perform and what sort of tenants (short term?) they attract. The other interesting development is the rejunvenation of the suburbs and moving of companies and gov agencies to alternative city centers, e.g. Jurong. Would prices in the suburbs start to converge with the prime areas and resulting in more even income/asset value distribution in Singapore? Let's see.

    Quote Originally Posted by chestnut
    I am not preaching.... I am just giving a reminder to people who only have 1 unit and there believe 2012 will correct.... They sell and then what if it does not correct???

    How many of you sold in 2008 and bought in 2009???? How many of you expected the property to continue to drop all the way thru 2010???? No one can predict correctly but we can speculate... I believe you have to buy properties within your means and I really do not wish to see anyone go thru what I went thru in 2003 (700k paper losses). Lucky for me, the bank did not ask for top up??? Do not over leaverage....

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    Quote Originally Posted by Wild Falcon
    Agree. You can only play the game if you have more than one property. I will always keep my owner occupied property which I fondly call home. I think people should treat their primary abode as their home and not sell and rent and wait for market to crash

    I think it would be very interesting once all the mickey mouse units TOP. Clearly almost all of them will enter the rental market and ang moh tenants don't like small units as it cramps their creativity. So it would be interesting to see how these units perform and what sort of tenants (short term?) they attract. The other interesting development is the rejunvenation of the suburbs and moving of companies and gov agencies to alternative city centers, e.g. Jurong. Would prices in the suburbs start to converge with the prime areas and resulting in more even income/asset value distribution in Singapore? Let's see.
    Stay in mickey mouse unit and rent out big units...hee hee

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    Singapore is entering a challenging time.

    In the middle to late 90's a lot of hongkongers became singapore pr
    coz there were uncertainties when hk would be returned to china in 1997.
    My hongkong colleagues bought HDB flats - they said cheap & big.
    During that time prices was increasing almost quarterly. People are
    chasing after properties, spurred by sudden influx of PRs (i guess)buying up houses. Queue up also can make money. People were crazy. After 1997 when they found out that everything was ok some returned back to HK and rented out their HDB flats, collecting rental income every month . Only few who make it in Spore stayed.

    Following the financial crisis, house prices clashed. Up till now
    prices barely return to its peak.

    History repeats, now that PR are increasing from everywhere and starts
    buying HDBs, the game is coming back again.

    Whether the game can continue long will depend on whether uncle sam still retain the open policy opening doors to FT. Prices will definitely increase as long as the population is growing.

    But what happen if the 2 IRS do not work out and economy not doing well and these FT/PR suddenly gone for greener pastures and the high rollers are not coming... what happened...? You guess..?

    I wonder propertism still holds when in 2030 you see 1 in 3/5 on the street holding walking sticks

    Anyway I like JRS propertism msg - quite true if things work out the other way.

    Just my thought. No right no wrong. Take time to enjoy your life too while playing ur property game

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    Quote Originally Posted by chestnut
    I am not preaching.... I am just giving a reminder to people who only have 1 unit and there believe 2012 will correct.... .
    bro thread starter Property Owner, and quite a few of the names posting in this thread, have more than 1 properties ok

    you cannot be long on pty for too long (sorry again jlrx ). this business is cyclical in nature. there bound to be a time you should exit. Of course no one can predict, so no harm talk talk here lor. Sell on the way up, that's my point. Just hope it's not too late.
    Last edited by amk; 13-03-10 at 20:45.

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    Quote Originally Posted by amk
    bro thread starter Property Owner, and quite a few of the names posting in this thread, have more than 1 properties ok

    you cannot be long on pty for too long (sorry again jlrx ). this business is cyclical in nature. there bound to be a time you should exit. Of course no one can predict, so no harm talk talk here lor. Sell on the way up, that's my point. Just hope it's not too late.
    I am aware that a few here have a few properties... So do I... I have also started palying this market for more than 20 years... So what is your point???

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    Default Sell high

    July - November 2011.

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    Quote Originally Posted by amk
    bro thread starter Property Owner, and quite a few of the names posting in this thread, have more than 1 properties ok

    you cannot be long on pty for too long (sorry again jlrx ). this business is cyclical in nature. there bound to be a time you should exit. Of course no one can predict, so no harm talk talk here lor. Sell on the way up, that's my point. Just hope it's not too late.
    Although some members here don't like me to keep repeating the same things again and again, I have no choice but to correct mistakes that pop up again and again in the forums.

    A statement like "you cannot be long on pty for too long" is simply, absolutely wrong.

    Despite the short term cycles, property prices will always go up in the long term.

    This had been proven by history.

    Historical facts were irrefutable. Historical facts had shown that properties should only be bought. Not sold.

    Read this post by me: http://forums.condosingapore.com/sho...9&postcount=88

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    xebay11 is offline New Launch Project Specialist
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    Quote Originally Posted by Water Lover

    I wonder propertism still holds when in 2030 you see 1 in 3/5 on the street holding walking sticks
    Wow, this is a nugget of information, better preach to my son not to hold too many properties and concentrate in growth regions.

    Thanks to many of jlrx posts of old news paper cuttings I can see that many instances of property trends cannot be extrapolated.

    Just like in 1981, price of a terrace house and detached house, the difference only $500k, today, assuming I have a very good well located terrace house, it would fetch me $2m but a detached home in similar location would set me back by at least $4m.........so one has to take at least $2m loan to upgrade, not easy.
    Last edited by xebay11; 14-03-10 at 09:20.

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    Quote Originally Posted by chestnut
    I am aware that a few here have a few properties... So what is your point???
    I said that a few times already, and that's in the very paragraph u quoted

    Quote Originally Posted by amk
    Sell on the way up, that's my point
    we all treated pty business as investment. I believe all investments have a point of exit (aka "fully valued" ) . Property Owner raised the very valid point of when to do it. I hold a view of 2012. You are more positive than us, that is a good thing . I agree with you on this : selling one's only residence and hoping for the next crash to buy back is pointless, that's almost akin to short selling of shares. However when you already hold multiple investment ptys, you should contemplate your next move.

    Unless you are fully converted to propertism, then you hold it as if it's perpetual bond . But you lose liquidity for some other finer things in life. (But that's not a problem for you, is it ? )

    btw I know some one who successfully cash out his pty at 2007 peak. but he didn't believe early 2009 was the bottom, and lost out thr opportunity to long again. Now he's long on cash, hoping for a double dip.

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    Quote Originally Posted by xebay11
    Wow, this is a nugget of information, better preach to my son not to hold too many properties and concentrate in growth regions.

    Thanks to many of jlrx posts of old news paper cuttings I can see that many instances of property trends cannot be extrapolated.

    Just like in 1981, price of a terrace house and detached house, the difference only $500k, today, assuming I have a very good well located terrace house, it would fetch me $2m but a detached home in similar location would set me back by at least $4m.........so one has to take at least $2m loan to upgrade, not easy.
    If you had taken that 500k and invested at an average rate of 10% over the following 29 years it would be worth 15x as much - approx 8 million.

    In this case property is a bad investment. Maybe I should start a "religion" of "stockism" or "bondism". I must be really smart for discovering this

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    Quote Originally Posted by amk
    I said that a few times already, and that's in the very paragraph u quoted


    we all treated pty business as investment. I believe all investments have a point of exit (aka "fully valued" ) . Property Owner raised the very valid point of when to do it. I hold a view of 2012. You are more positive than us, that is a good thing . I agree with you on this : selling one's only residence and hoping for the next crash to buy back is pointless, that's almost akin to short selling of shares. However when you already hold multiple investment ptys, you should contemplate your next move.

    Unless you are fully converted to propertism, then you hold it as if it's perpetual bond . But you lose liquidity for some other finer things in life. (But that's not a problem for you, is it ? )

    btw I know some one who successfully cash out his pty at 2007 peak. but he didn't believe early 2009 was the bottom, and lost out thr opportunity to long again. Now he's long on cash, hoping for a double dip.
    There are many plays... I dont think 1 play fits all. Take example shares : Some buy shares for dividend yield (rental yield in property). Some buy for potential growth/speculative. Some do contra (flipping). So you cannot just take 1 model and say that is it...

    Some will sell half the shares at the peak(in their view) and still stay vest half just in case it continues to go up. Some will sell all and wait for a drop (not vested at all) - this is a gamble. If it drops, he is a major winner, if it continues on the uptrend, he is screwed.. Quek still stay vested as he sells on the way up...(of course you can say that is his bread and butter)... I am here to share views....

    As for your statement - there are many reading the forum who may not have 2 or more properties and I am just sharing my views.. I had a good mentor who taught me and I just wanted to share back... That is all...

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    Quote Originally Posted by chestnut
    Some stats and you draw your own conclusion :

    80% of properties are hdb.

    HDB did 13,000 BTO in 08.

    No of marriages in Singapore ave 24,000

    Can you imagine how many married couples still do not own hdb? Over the last few years, foreign workers have been flooding and taking up resale hdb. Do you think hdb will build more flats to cater to masses? Do you think hdb will sell cheaper in the next few years? Do you think hdb prices will drop?

    The increase in prices are either bottom up or top down... In 2005, it was top down... Orchard road started first and this caused a spill over the rest of the market. In 2009, it was bottom up... HDB climbed, resulting in private moving up....

    I dont see a crash, maybe a correction from an economic issue ... job losses, another recession, etc... but if you look at the supply/demand.... The demand is more than supply.... Just imagine, if 5% of the hdb population wants to upgrade to private, what is the number translated to? And if you look at the previous cycle, when do they want to upgrade? Is it when their hdb is under water or when they are making money???? The question is when to pull out when there is a correction. That is the million dollar question. I had a friend who sold his Katong semi-d in 1991 for 500k in anticipation of a drop and started renting.... Guess what, waited until he finally got a small apartment in 1996 and the rest is history...
    "If 5% of the hdb population wants to upgrade to private.. "

    Well, need some corrections here....this 5% don't live alone.

    The demand of new home depend fundamentally on the grew rate of population. If no foreigners settling here and singaporean population don't grew fast, there is not need for too much new home(private or hdb).

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