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Thread: City fringe condos

  1. #91
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    Outside CCR generally poorer, if not by %, then by average also true isn't it?
    private property owners living near or beside HDB flats' generally cannot be very rich right? Have you ever seen any Good Class Bungalows that is 99-years leasehold and beside HDB flats?

    Quote Originally Posted by anythingwhatever View Post
    By this definition, every location outside CCR is poor?

    OK you win...

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    Quote Originally Posted by CCR View Post
    Can someone enlighten me, USA index shows prices have dropped 12% but Developers are bidding land at record prices... even higher than the last peak... why is that so?
    The Developers know something we don't know.

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    Quote Originally Posted by teddybear View Post
    Outside CCR generally poorer, if not by %, then by average also true isn't it?
    private property owners living near or beside HDB flats' generally cannot be very rich right? Have you ever seen any Good Class Bungalows that is 99-years leasehold and beside HDB flats?
    Wow you are very elitist. Paint the property and people in OCR until so jialat… Halimah must be very sad.

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    Quote Originally Posted by CCR View Post
    Can someone enlighten me, USA index shows prices have drop 12% but Developers are bidding land at record prices... even higher than the last peak... why is that so?
    Why refer to USA index when the China and HK indices are much closer to home???
    The three laws of Kelonguni:

    Where there is kelong, there is guni.
    No kelong no guni.
    More kelong = more guni.

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    Quote Originally Posted by Kelonguni View Post
    Why refer to USA index when the China and HK indices are much closer to home???
    URA?

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    Why the developers need to know or even care when they bid high and can sell higher (flip) to those new launch property buyers?
    Regardless of land price, they still have their own and employees' salary to pay, their offices rental to pay, their perks that costs money, so they just have to ensure there is construction work going on and revenue coming in!

    Anyway, The high price is the risk that the new launch buyers are shouldering, not property developers, so why should developers care?


    Quote Originally Posted by Arcachon View Post
    The Developers know something we don't know.
    Quote Originally Posted by CCR View Post
    Can someone enlighten me, USA index shows prices have drop 12% but Developers are bidding land at record prices... even higher than the last peak... why is that so?

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    Quote Originally Posted by PropVestor View Post
    URA?
    Haha ok...

    1. Basically enbloc and developers' bid prices are different from URA computed prices. The profits that enbloc sellers gain are not computed in the indices.

    2. We do not have a solely new sale price index as yet. All local indices depend mainly on resales. URA seems to include new properties but how they specify completion status and weigh the various attributes is unclear. For example, if a very very old 80, year old property is transacted at record low prices, it could be included as one within an attribute of ">30 years old" properties. If more older and poorer location properties are transacted at lower (but not disproportionately lower prices), it will still weigh down on the index.

    3. The methodology is 5-quarter fixed weight, with the weights revised every 3 years. 5 quarter aggregation means the index will be slow to show any positive changes. You will require at least 3 quarters of positive change and 2 quarters of negative change (assuming same magnitude) to see an actual positive change. Many are saying that it is at most a few quarters away. When it inverts, you will need to wait for the next cycle before it turns back...
    The three laws of Kelonguni:

    Where there is kelong, there is guni.
    No kelong no guni.
    More kelong = more guni.

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    Quote Originally Posted by Kelonguni View Post
    Haha ok...

    1. Basically enbloc and developers' bid prices are different from URA computed prices. The profits that enbloc sellers gain are not computed in the indices.

    2. We do not have a solely new sale price index as yet. All local indices depend mainly on resales. URA seems to include new properties but how they specify completion status and weigh the various attributes is unclear. For example, if a very very old 80, year old property is transacted at record low prices, it could be included as one within an attribute of ">30 years old" properties. If more older and poorer location properties are transacted at lower (but not disproportionately lower prices), it will still weigh down on the index.

    3. The methodology is 5-quarter fixed weight, with the weights revised every 3 years. 5 quarter aggregation means the index will be slow to show any positive changes. You will require at least 3 quarters of positive change and 2 quarters of negative change (assuming same magnitude) to see an actual positive change. Many are saying that it is at most a few quarters away. When it inverts, you will need to wait for the next cycle before it turns back...
    Very insightful. Thanks for sharing.

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    Quote Originally Posted by frumnat View Post
    Wow you are very elitist. Paint the property and people in OCR until so jialat… Halimah must be very sad.
    90/10 Rule. 90% Poor, 10% Rich.

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    There is only a handful of condos in Singapore that meet such a requirement and most are held by you guessed it, elites which are safeguarding it for themselves. They are quite untouchable based on their network and leverage.

    Some of the best margins are made from OCR condos/ECs as they command a very low entry price exactly due to their OCR location. Yet, these owners can easily upgrade to a private condo somewhere else rather comfortably. Is that a bad thing? Not at all. I am in fact envy of that opportunity. A buddy of mine did exactly that and now is staying at a 4-bedder Santorini apartment that is pool facing with little to top up for that massive space upgrade. You may argue that he might suffer a loss in years to come but can you really tell the future?

    Against narrow minded investors,
    PropVestor

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    Quote Originally Posted by teddybear View Post
    Why the developers need to know or even care when they bid high and can sell higher (flip) to those new launch property buyers?
    Regardless of land price, they still have their own and employees' salary to pay, their offices rental to pay, their perks that costs money, so they just have to ensure there is construction work going on and revenue coming in!

    Anyway, The high price is the risk that the new launch buyers are shouldering, not property developers, so why should developers care?
    Developer play the same leverage game as we do but on a much shorter period. If he put down 10% of his own money and get 10% profit....he is making 100% return. Its all bank's money.

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    Quote Originally Posted by anythingwhatever View Post
    90/10 Rule. 90% Poor, 10% Rich.
    you mean 80-20 rule (Pareto's law)

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    Quote Originally Posted by indomie View Post
    Developer play the same leverage game as we do but on a much shorter period. If he put down 10% of his own money and get 10% profit....he is making 100% return. Its all bank's money.
    Developers are indeed borrowing as much as they can in this low interest rate environment to get the maximum mileage for their investment. Consortiums are form as each developer has different leverage capabilities which is correlated to their size. Even giants like Wanda (~RMB 800bn market cap) is at the mercy of the banks and have to liquidate US$9.3bn tourism assets to pay them back bank loans. They are at a leash too very much like Trump's real estate business.

    It is debt driven business for both developers and land owners.

    http://www.latimes.com/business/la-f...710-story.html

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    Quote Originally Posted by tonymontana View Post
    you mean 80-20 rule (Pareto's law)
    90-10 Teddy Rule

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    Quote Originally Posted by PropVestor View Post
    Developers are indeed borrowing as much as they can in this low interest rate environment to get the maximum mileage for their investment. Consortiums are form as each developer has different leverage capabilities which is correlated to their size. Even giants like Wanda (~RMB 800bn market cap) is at the mercy of the banks and have to liquidate US$9.3bn tourism assets to pay them back bank loans. They are at a leash too very much like Trump's real estate business.

    It is debt driven business for both developers and land owners.

    http://www.latimes.com/business/la-f...710-story.html
    Largest Southeast Asian banks by total assets Edit

    Information from Forbes as of 2017[1]

    Rank Bank name Country Total assets
    (US$ billion)
    1 DBS Bank Singapore 333.5
    2 OCBC Bank Singapore 283.7
    3 United Overseas Bank Singapore 235.4
    4 Maybank Malaysia 164.1
    5 CIMB Malaysia 108.3
    6 Public Bank Berhad Malaysia 84.7
    7 Bangkok Bank Thailand 82.2
    8 Siam Commercial Bank Thailand 81.3
    9 Kasikornbank Thailand 79.5
    10 Bank Mandiri Indonesia 77.1

    Mind u Sg banks are giants in comparison with neighbor's banks. With assets so huge and liquidity drowning, chasing so little government land.

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    Quote Originally Posted by PropVestor View Post
    Very insightful. Thanks for sharing.
    My pleasure always to contribute my understanding. Any discrepancies or counterargument based on facts (for example if anyone has insider URA computation info), please feel free to share.
    The three laws of Kelonguni:

    Where there is kelong, there is guni.
    No kelong no guni.
    More kelong = more guni.

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    Quote Originally Posted by PropVestor View Post
    Developers are indeed borrowing as much as they can in this low interest rate environment to get the maximum mileage for their investment. Consortiums are form as each developer has different leverage capabilities which is correlated to their size. Even giants like Wanda (~RMB 800bn market cap) is at the mercy of the banks and have to liquidate US$9.3bn tourism assets to pay them back bank loans. They are at a leash too very much like Trump's real estate business.

    It is debt driven business for both developers and land owners.

    http://www.latimes.com/business/la-f...710-story.html


    Maybe also prepare for Taiwan to come over.

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    hot hot

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    Yes, 100% Palms 100% Sold.

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    Quote Originally Posted by Amber Woods View Post
    Developers are running a business. No land means no business. The company has fixed costs to pay. Without land to build and sell, they will suffer losses. With land, they can shift some of the costs to the project. Even if their projects do not make profit, their losses can be lesser. That is why, developers will try to outbid each other even in a slow market. They need the land to survive their business.
    This should be the reason why developers are buying higher. Right now, the market setup allows them to sell higher.

    Property can be bought in any market condition, value can be found in any market condition so long as the buyer knows how to weigh a prospect.

    But.

    To sell a property in the portfolio, it requires the right market condition. It requires a bullish market to sell into.

    It is not the buying that made the profit but the selling.

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    Quote Originally Posted by teddybear View Post
    Property's Good location means some where in CCR convenient location where the RICH and influential lives (and there is no HDB flats within 1km).......

    Property's Good attributes means MUST be Freehold, with underground MRT station and shopping malls nearby within walking distance (<500m), good facing, good feng shui, high floor, no west sun,...........
    Agreed.

    Having the right mix of occupants is important.

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    Quote Originally Posted by aspirations View Post
    well to be honest I'm vested in D12.. and so I'm hoping that it can ride on the recent soar in prices seen in the Queenstown/ red hill area. I bought my place about 5 years back.. rented it out for the past 1+ years.. but so far haven't seen much if any increase in PSF, which is a bit disheartening. Rental return about 2.8%. On the other hand, red hill and queens town is soaring (as in the new condos there). My cousin who's rich bought echelon high floor at $2k PSF- simply insane if u ask me. He also bought it maybe 2/3 years back? Dunno if he's made any paper profit yet though..

    Right now since I'm a bit older and wiser (and richer haha).. I'm looking to sell my D12 condo and buy a better one, maybe around $2-2.2m. It's quite a lot of money I know.. but I'm young (still just 28) so I'm willing to stretch myself. My D12 unit is 95% paid up so if I do manage to sell it at cost price (which is fine w me) I will need to top it up by maybe 900k? I admit I come from a rather privileged background.. but I do work hard and save on wants.. my parents are also v supportive of the above plans. But what do u guys think? Too much too soon? Should I just be contented w what I have?

    Currently living in D15, which is great.. but wanna explore other areas outside Katong
    The game of property is a leveraged game, don't lose sight of this.

    So, it is to make more money by borrowing money. When the property is 20% paid, meaning you are borrowing 80%, the objective is growth.

    Why the property is 95% paid, the objective should be shifted to capital protection.

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    Quote Originally Posted by Hakuho View Post
    The game of property is a leveraged game, don't lose sight of this.

    So, it is to make more money by borrowing money. When the property is 20% paid, meaning you are borrowing 80%, the objective is growth.

    Why the property is 95% paid, the objective should be shifted to capital protection.
    Different people play the same game differently. I play max leverage other don't.

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    Quote Originally Posted by Hakuho View Post
    The game of property is a leveraged game, don't lose sight of this.

    So, it is to make more money by borrowing money. When the property is 20% paid, meaning you are borrowing 80%, the objective is growth.

    Why the property is 95% paid, the objective should be shifted to capital protection.
    can you try to simplifying what ur saying? im just a noob i need more explanation haha thanks

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    If don't want to play the leveraged game, then with today’s rental yield might as well put the money in bond sua.

    Actually yours is not max leveraged, LOL.

    However, I agreed that everyone should do what he is comfortable with.

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    Quote Originally Posted by aspirations View Post
    can you try to simplifying what ur saying? im just a noob i need more explanation haha thanks
    ?

    You have a million, and thinking of doing two millions so didn't sound like a noob to me.

    So in your case, 5 years ago when D12 property was bought how much was the capital deployed and how much was the loan amount and tenure? And presumably the mortgage payments were completely funded from rental income?

    It is better to illustrate using real data, even though by asking for it it can be intrusive to you.

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    Quote Originally Posted by Hakuho View Post
    If don't want to play the leveraged game, then with today’s rental yield might as well put the money in bond sua.

    Actually yours is not max leveraged, LOL.

    However, I agreed that everyone should do what he is comfortable with.
    You are right, mine all within MAS Guidelines.

    200K(5 room HDB) - 1995
    428K(Southbank) - 2006
    660K(Southbank Cash out) - 2011
    750K(Terrasse) - 2011

    wow 6 years no action, very itchy.



    https://www.srx.com.sg/cooling-measures
    Last edited by Arcachon; 25-07-17 at 07:51.

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    arcachon, your southbank was only 428k in 2006? that's good returns.

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