Property market sentiments 2011

[rattydrama]

My take is 2011 property will move a little, not much, due to the much anticipated land sales. Those property near MRTs and good amenities will have a niche advantage from the rest. The price gap between CCR and OCR narrowing and likely between old and new developments within the same vicinity.

It will also depend on the introduction of new policies by the government after the election. Will we have an influx of PRs? If yes, it will be a good news to investors.

Share your thoughts.

[devilplate]

i want to see silver, oil related stocks and my ppty FLY

[ymgsterling]

Everybody huat in 2011!

[Wild Falcon]

My predictions:-

1) Property - upside will be capped - for all districts.

2) District lines get blurred - investors become more savvy and discerning, i.e. investments will be based on the attributes and development potential of an area and new transportation nodes/regional centers and not purely based on district numbers.

3) CCR and OCR medium term performance - I don't think prices will diverge, i.e. I don't think CCR will have runaway prices while OCR crash. Looking at the developers new launch pricing, it is pretty clear that developers believe PSF is converging. In my mind, developers pricing is always a "futures" pricing based on best available information. If developers "futures pricing" indicate that prices are expected to converge for new launches that will TOP 3 years later, I believe the same will apply to resale, i.e. resale in OCR and the resale in CCR will converge over time in the medium term.

4) CCR and OCR short term performance - The performance in the immediate 1 year will depend on how much "foreign" hot monies come into SG property. If lots of foreign hot monies flow into SG property, then CCR may outperform in the short term.

[kane]

LTV of 60% to be introduced is my guess. Resale prices likely to continue tracking inflation rate.

[kingkong1984]

No new cooling measures, just more and more hdbs and ec plus OCR condos

[hopeful]

You remembered SM Goh speech?
Govt welcome foreign investors to buy property.
park money in Singapore, they stay overseas, don't contribute to overpopulation, basically foreign investors buying space in the sky.
Invest money in physical property is different from hot money is stocks. So far property is outperforming the stock market.

[Squall8888]

My guess is that CCR will start moving. I see many transactions done in Dec and that reflects a good increase. Just wait for caveats. OCR also not bad but mass market, hmmm :rolleyes::rolleyes:

Government will probably not step in if mass market remains the way it is now..

[devilplate]

My guess is that CCR will start moving. I see many transactions done in Dec and that reflects a good increase. Just wait for caveats. OCR also not bad but mass market, hmmm :rolleyes::rolleyes:

Government will probably not step in if mass market remains the way it is now..
STI to outperform PPI ;)

[azeoprop]

If no global crisis or korean war happens, I think prices will still move up. 2011 is when many people get fat bonus from the record growth year of 2010....more cash rich people around! :scared-1:

[Laguna]

My readings
1. Sg Govt is very concerned about hot money flow in, as such, more cooling measures likely to take place. LTV possible would be reduced for second and third properties.
2. Property market will up at a very much slower pace
3. Fundamental remains good,
4. US probably will turn around this year, there could be one or more QE
5. Growth in China will slow down, due to the currency war



What shall the best yield investment now ?
read Chinese paper last week on the possible over supply of EC, if recall correctly, when EC came into market last two rounds, then property market headed south

[devilplate]

My readings
1. Sg Govt is very concerned about hot money flow in, as such, more cooling measures likely to take place. LTV possible would be reduced for second and third properties.
2. Property market will up at a very much slower pace
3. Fundamental remains good,
4. US probably will turn around this year, there could be one or more QE
5. Growth in China will slow down, due to the currency war



What shall the best yield investment now ?
read Chinese paper last week on the possible over supply of EC, if recall correctly, when EC came into market last two rounds, then property market headed south

last round, EC came in too late....govt learnt their lesson....so push ECs into market much earlier this rd

[devilplate]

STI chiong now!

most experts saying STI to hit 3500-3600pts this yr...so conservative....or they mean 3500pts by 1st half of 2011?:D

[august]

LTV of 60% to be introduced is my guess. Resale prices likely to continue tracking inflation rate.

my guess only after election and track china's measures

[Wild Falcon]

LTV of 60% should be targeted at second property and beyond, and exceptions should be given to genuine HDB upgraders. I hope more demand side measures and stop flooding the market with supply. A lot of CCR condos are going to TOP empty and some have dropped prices (e.g. Paterson Suites) to move units (as reported not too long ago) and if more supply comes on board, the market may not be able to absorb.


my guess only after election and track china's measures

[teddybear]

That is very funny! You are talking about Govt flooding the market with supply and then say CCR prices affected because cannot absorb the supply? By the way, the Govt has so far not released a single piece of residential land in CCR. All residential lands sold by Govt falls in OCR. Remember, the Govt still has more than enough land in OCR to supply >2m residential OCR units! Ops! You scare of supply side measure? Then you should worry about the prices of OCR properties!! :doh:


LTV of 60% should be targeted at second property and beyond, and exceptions should be given to genuine HDB upgraders. I hope more demand side measures and stop flooding the market with supply. A lot of CCR condos are going to TOP empty and some have dropped prices (e.g. Paterson Suites) to move units (as reported not too long ago) and if more supply comes on board, the market may not be able to absorb.

[devilplate]

That is very funny! You are talking about Govt flooding the market with supply and then say CCR prices affected because cannot absorb the supply? By the way, the Govt has so far not released a single piece of residential land in CCR. All residential lands sold by Govt falls in OCR. Remember, the Govt still has more than enough land in OCR to supply >2m residential OCR units! Ops! You scare of supply side measure? Then you should worry about the prices of OCR properties!! :doh:

hey bear, u nvr owned a RCR/OCR ppty in ur entire life?

[Laguna]

was told that NV residences has dropped price of about 3-5%

[bargain hunter]

looking at the number of upcoming MM new launches. i think better to buy oxley than the units that they are selling. MM craze.



STI chiong now!

most experts saying STI to hit 3500-3600pts this yr...so conservative....or they mean 3500pts by 1st half of 2011?:D

[teddybear]

Been there before but experience tells me that they are not "investment grade" especially with Govt holding so much free empty OCR land. :cheers1:


hey bear, u nvr owned a RCR/OCR ppty in ur entire life?

[teddybear]

Looks like OCR private property prices is really slowing down after the Aug 30 measure. :scared-3:
Some people said CCR have to drop prices to move units (quoting just an estate as an example to signify the whole CCR) , but yet the CCR property price index went up! Who is telling lies (or part lies to mislead) and who is telling truth? :banghead:

------------------------------
Private property prices hit new high in Q4 2010
By Ryan Huang | Posted: 03 January 2011 1402 hrs
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SINGAPORE: Prices of private residential properties hit a new high in the fourth quarter of 2010. This is according to the latest flash estimates from the Urban Redevelopment Authority (URA).

The price index for private residential property rose 2.7 per cent to 194.8 points. This compares with 2.9 per cent in the previous quarter.

For the full year, the price index increased by 17.6 per cent in 2010.

For the fourth quarter, non-landed residential properties in the prime city area, or core central region, led the price increase at 2.3 per cent.

The city fringe areas, or rest of central region, posted a 1.7 per cent increase during the quarter. And suburban areas, or outside central region, showed an increase of 1.6 per cent in the same period.

In comparison, for the 3rd quarter of 2010, prices of non-landed private residential properties increased by 1.6 per cent in the core central region, 2.3 per cent in the rest of central region and 2.2 per cent in the outside central region.

For the full year, prices increased 14.3 per cent, 17.5 per cent and 14.5 per cent in the core central region, rest of central region and outside central region respectively.

-CNA/ac



LTV of 60% should be targeted at second property and beyond, and exceptions should be given to genuine HDB upgraders. I hope more demand side measures and stop flooding the market with supply. A lot of CCR condos are going to TOP empty and some have dropped prices (e.g. Paterson Suites) to move units (as reported not too long ago) and if more supply comes on board, the market may not be able to absorb.

[devilplate]

looking at the number of upcoming MM new launches. i think better to buy oxley than the units that they are selling. MM craze.
So u help to push up oxley share prices last few days.... Hehe.... I aso worried liao.... Majority new launches either mm 1 or mm 2 bedders

[teddybear]

Want to invest in properties, better buy the physical properties than the developers' shares, you will not win them buying the latter too (as they will be the biggest winner, just like buying REITs). :scared-3:


looking at the number of upcoming MM new launches. i think better to buy oxley than the units that they are selling. MM craze.

[bargain hunter]

notice i was away from the forum last week? i was so busy last week. ;) ok lah, want to push, push together lah? hahaha...oxley game still early lah, at least 2 launches (vibes @ kovan and loft @ holland) these few months and 3 more before june. but dun buy the shares after end april as the moratorium for the original shareholders end and they can cash out anytime at fat profits.

yah scary. i find it even more scary when boutique developers r going for full mm 1 bedder projects with 2 bedders (if they can be called 2 bedders in the first place) even non existent! :scared-1:


So u help to push up oxley share prices last few days.... Hehe.... I aso worried liao.... Majority new launches either mm 1 or mm 2 bedders

[bargain hunter]

shares of ppty developers' are for trading and are not investible. they are also not for everyone. :)


Want to invest in properties, better buy the physical properties than the developers' shares, you will not win them buying the latter too (as they will be the biggest winner, just like buying REITs). :scared-3:

[azeoprop]

Price did drop for some smaller developments.

E.g. 1 Stillz residence
21 Lorong 108 Changi #02-06
Freehold
$879
1012
$889k
30 Nov 10

21 Lorong 108 Changi #04-06
Freehold
$1048
1012
$1060k
27 Aug 10


E.g. 2 Parc Elegance
Was quoted #04-01 during launch price $875868

13 Telok Kurau Road #04-01
Freehold
$1238
700
$866k
26 Oct 10

[bargain hunter]

$171k is a little too steep isn't it?


Price did drop for some smaller developments.

E.g. 1 Stillz residence
21 Lorong 108 Changi #02-06
Freehold
$879
1012
$889k
30 Nov 10

21 Lorong 108 Changi #04-06
Freehold
$1048
1012
$1060k
27 Aug 10


E.g. 2 Parc Elegance
Was quoted #04-01 during launch price $875868

13 Telok Kurau Road #04-01
Freehold
$1238
700
$866k
26 Oct 10

[azeoprop]

$171k is a little too steep isn't it?

Dunno leh, maybe last unit lelong sales? :beats-me-man:

[Wild Falcon]

Latest URA index:-

CCR - 200% above Q4'1998 price
RCR - 180% above Q4'1998 price
OCR - 178% above Q4'1998 price

NB: Index Q4'98 = 100

http://www.ura.gov.sg/pr/graphics/2011/pr11-01b.pdf

Looks like no more cooling measures as long as quarterly increases is less than 3% :)

[Wild Falcon]

For the year 2010 as a whole, prices increased by 14.3%, 17.5% and 14.5% in Core Central Region, Rest of Central Region and Outside Central Region respectively.

====

RCR is the "star performer" in 2010 leh :)

[dtrax]

RCR or not, all Huat ah!!!

[kingkong1984]

good year...

started with recession in 09...

stunning recovery in 10...

and so many hopefuls expecting a crash in 11... coe to crash first, then follow by sti.. then only property got chance.

[DC33_2008]

What is the likelihood (%) of a crash in 2011?

[Wild Falcon]

I heard the end of "Rat" year is usually is beginning of recession, "bull" year is always the worst year (not bull at all!), Tiger is always the recovery year (even though people always say Tiger year will die).... looks like its true after all :)


good year...

started with recession in 09...

stunning recovery in 10...

and so many hopefuls expecting a crash in 11... coe to crash first, then follow by sti.. then only property got chance.

[Regulators]

If OCR properties not investment grade, how do you explain first owners at centris making 5xxpsf and caspian owners making 4xxpsf in one year? If you are offered a condo in serangoon for 3xx-4xxpsf as opposed to an orchard condo for 4000psf, which do you think is a sounder investment to an investor?
Been there before but experience tells me that they are not "investment grade" especially with Govt holding so much free empty OCR land. :cheers1:

[teddybear]

Please wait for a few cycles over say 30 years then may be you will understand.
$5xx psf profit? So low? Come on! :doh:


If OCR properties not investment grade, how do you explain first owners at centris making 5xxpsf and caspian owners making 4xxpsf in one year? If you are offered a condo in serangoon for 3xx-4xxpsf as opposed to an orchard condo for 4000psf, which do you think is a sounder investment to an investor?

[Regulators]

4xx-5xxpsf are returns after one or two years not ten years. If you call yourself an investor, you look at roi in that one year and compare. If all your investments earn you a1k psf profit a year, then maybe you have the right to look down on ocr investment properties otherwise you can't say ocr properties are not investment grade. If govt chooses to boost ocr prices coupled with feo factor, you will just be a voice in the wind
Please wait for a few cycles over say 30 years then may be you will understand.
$5xx psf profit? So low? Come on! :doh:

[teddybear]

Let's be realistic. The Govt owns almost all of the free standing empty OCR lands. You expect them to boost OCR prices by not selling any land when there is strong demand for own residential stay? OCR properties are just for own residential stays, that is it, not investment grade over long term.
Like FEO? They own the FH land status and sell you 99LH lease? Yes, in this respect both are same same. :banghead:


4xx-5xxpsf are returns after one or two years not ten years. If you call yourself an investor, you look at roi in that one year and compare. If all your investments earn you a1k psf profit a year, then maybe you have the right to look down on ocr investment properties otherwise you can't say ocr properties are not investment grade. If govt chooses to boost ocr prices coupled with feo factor, you will just be a voice in the wind

[taggy]

Latest URA index:-

CCR - 200% above Q4'1998 price
RCR - 180% above Q4'1998 price
OCR - 178% above Q4'1998 price

NB: Index Q4'98 = 100

http://www.ura.gov.sg/pr/graphics/2011/pr11-01b.pdf

Looks like no more cooling measures as long as quarterly increases is less than 3% :)


can someone teach please...
i see ccr index way above rcr and ocr, that means the psf in ccr is higher than the other 2.
Then i see q1-09, ocr above rcr, does that mean that time, price of ocr is higher than rcr ? i dun remember any unit in eg. citylights cheaper than kovan melody leh ?

[mantrix]

Let's be realistic. The Govt owns almost all of the free standing empty OCR lands. You expect them to boost OCR prices by not selling any land when there is strong demand for own residential stay? OCR properties are just for own residential stays, that is it, not investment grade over long term.
Like FEO? They own the FH land status and sell you 99LH lease? Yes, in this respect both are same same. :banghead:

I find the term 'investment grade' interesting. What are the factors influencing something like that? Livability, desirability perhaps? With district lines blurring, no point to pit 'ccr' vs 'ocr' - those are already archaic terms. Gotta live in the present.

To many, just singapore itself, being so tiny (why decimate a small enough place? Finding quarks?), is a giant piece of prime estate - owning a piece of it will be enough. Saying 'I own property in singapore' is prestigious than saying 'I own property in Butterworth' or 'I own property in Jakarta'

[Wild Falcon]

The index does not tell u relative prices. even the experts experts understand the index wrongly. The index just merely says within each district, how much has the price increase relative to 4Q'1998?

This means on average, a CCR property has increased 200% relative to itself in 4Q'1998. A CCR property that cost 800psf in 4Q1998 would be $1600psf (x 200%) today. Similarly a RCR property that cost say 500psf in 4Q1998 would be worth 900psf (x 180%) today.

At a certain point in time, OCR did increase faster than RCR but RCR caught up again. The index does not tell relative prices across districts. Even many property experts do not understand the index and anyhow comment "peak here peak there" and anyhow conclude CCR has not peaked when the index doesn't tell relative prices at all!

In short, the index does not tell PSF. It just says how much a property increase relative to 4Q'1998. CCR obviously has risen the most - contrary to how the incompetent "experts" have been interpreting....


can someone teach please...
i see ccr index way above rcr and ocr, that means the psf in ccr is higher than the other 2.
Then i see q1-09, ocr above rcr, does that mean that time, price of ocr is higher than rcr ? i dun remember any unit in eg. citylights cheaper than kovan melody leh ?

[teddybear]

I think you have to be realistic. You expect everywhere in Singapore property prices to be >$3000 psf? I would hope that this is so but the mass market OCR property prices are meant for own-stay and the prices are determined by the affordability of people buying them. Unless all these people earn so much as to be able to afford >$3000 psf otherwise the answer is obvious. :cheers1:


I find the term 'investment grade' interesting. What are the factors influencing something like that? Livability, desirability perhaps? With district lines blurring, no point to pit 'ccr' vs 'ocr' - those are already archaic terms. Gotta live in the present.

To many, just singapore itself, being so tiny (why decimate a small enough place? Finding quarks?), is a giant piece of prime estate - owning a piece of it will be enough. Saying 'I own property in singapore' is prestigious than saying 'I own property in Butterworth' or 'I own property in Jakarta'

[kingkong1984]

I use simple terms. A OCR is a Toyota, number one in sale volume, a RCR is a vw, catching up and better performance. A CCR is a Porsche, few deals. A gcb will be a lambo or rolls Royce. Very expansive yes, deals are even fewer.

Which is a better bet? Your choice lah.

[Wild Falcon]

Really bad analogy. Like that lambo sure run faster one mah! In any case, the quality difference between the different regions is not even apparent nowadays. But for performance cars, it hell of a difference.


I use simple terms. A OCR is a Toyota, number one in sale volume, a RCR is a vw, catching up and better performance. A CCR is a Porsche, few deals. A gcb will be a lambo or rolls Royce. Very expansive yes, deals are even fewer.

Which is a better bet? Your choice lah.

[stalingrad]

Latest URA index:-

CCR - 200% above Q4'1998 price
RCR - 180% above Q4'1998 price
OCR - 178% above Q4'1998 price

NB: Index Q4'98 = 100

http://www.ura.gov.sg/pr/graphics/2011/pr11-01b.pdf

Looks like no more cooling measures as long as quarterly increases is less than 3% :)

these are indexes and therefore don't paint a full picture. west coast is part of OCR, but I am sure condos in west coast have appreciate much more in value than 78%. the growth rate is probably 120% since 1998.

On the other hand, condos in the hume probably have grown much less, probably just 50%.

[kingkong1984]

Yup, could be better. Essence is you pay for wat u get. But if u paid lambo price for a Toyota, gd luck.

[taggy]

The index does not tell u relative prices. even the experts experts understand the index wrongly. The index just merely says within each district, how much has the price increase relative to 4Q'1998?

This means on average, a CCR property has increased 200% relative to itself in 4Q'1998. A CCR property that cost 800psf in 4Q1998 would be $1600psf (x 200%) today. Similarly a RCR property that cost say 500psf in 4Q1998 would be worth 900psf (x 180%) today.

At a certain point in time, OCR did increase faster than RCR but RCR caught up again. The index does not tell relative prices across districts. Even many property experts do not understand the index and anyhow comment "peak here peak there" and anyhow conclude CCR has not peaked when the index doesn't tell relative prices at all!

In short, the index does not tell PSF. It just says how much a property increase relative to 4Q'1998. CCR obviously has risen the most - contrary to how the incompetent "experts" have been interpreting....

ic, understand now... 4Q98, all 3(ccr, rcr, ocr) start from index 100 (although at that time, the psf of the 3 were not equal).

[kingkong1984]

It's based on actual done deals. Beware, a few freak deals in CCR will paint a wrong picture. Easy to jack up there.

[Regulators]

bro, don't have to talk about other people's investment. Let me use the regent heights unit i bought 1 week ago for analysis. I bought my 1163sf 3 bedder for 770k with superb orientation and views and on very high floor. Look at what people are advertising now for a 2 bedder (http://www.propertyguru.com.sg/listing/2851942/for-sale-regent-heights). If This unit is indeed sold for 800k (28k less than the price advertised), that will act as a baseline for my larger 3 bedroom unit to sell at 880k or more. If I were to relaunch my unit for sale in the market at 880k (have checked with UOB that can support 8xxk), that will be 105k gross profit (not counting other cost yet). that may not be a lot to you in absolute terms, but that is 67% gross return on investment of 20% downpayment, not in 1 year, but in less than 1 month. Would you consider an ROI of more than 60% in 1 month lousy? I do not intend to sell even though my latest investment has appreciated in value in 1 week by 13.5%, as rental yield of 4.9% is a more attractive proposition to me.


Let's be realistic. The Govt owns almost all of the free standing empty OCR lands. You expect them to boost OCR prices by not selling any land when there is strong demand for own residential stay? OCR properties are just for own residential stays, that is it, not investment grade over long term.
Like FEO? They own the FH land status and sell you 99LH lease? Yes, in this respect both are same same. :banghead:

[maisonjai]

notice i was away from the forum last week? i was so busy last week. ;) ok lah, want to push, push together lah? hahaha...oxley game still early lah, at least 2 launches (vibes @ kovan and loft @ holland) these few months and 3 more before june.

V@K i heard from a lady distributing flyers outside Nex, she said only left PH the rest all taken. :scared-1:

L@H - There is a washer point but i can't the washer in the floorplan (except stack 09 &10) so is there a washer? Or using bar fridge stack on top of washer? Tenants are wearing disposable clothes or Landlord must throw in a washer board. haahaa. This mm thingy is getting a bit extreme, like a cell.:banghead:

[bargain hunter]

hahaha, that's why oxley chiong. i bot oxley shares to hedge the MM craze which i still refuse to be a part of. :ashamed1: maybe no washer = all bring clothes to laundry shop to wash? i aunt rented out a unit somewhere partially furnished and the single german tenant said fridge can liao, no need washer. :beats-me-man:


V@K i heard from a lady distributing flyers outside Nex, she said only left PH the rest all taken. :scared-1:

L@H - There is a washer point but i can't the washer in the floorplan (except stack 09 &10) so is there a washer? Or using bar fridge stack on top of washer? Tenants are wearing disposable clothes or Landlord must throw in a washer board. haahaa. This mm thingy is getting a bit extreme, like a cell.:banghead:

[kingkong1984]

We are talking a hotel like lifestyle, not a hdb stayer mindset.

[mantrix]

I think you have to be realistic. You expect everywhere in Singapore property prices to be >$3000 psf? I would hope that this is so but the mass market OCR property prices are meant for own-stay and the prices are determined by the affordability of people buying them. Unless all these people earn so much as to be able to afford >$3000 psf otherwise the answer is obvious. :cheers1:

I think your comment applies to yourself. I never once said OCR can hit past 3000psf. When we talk about convergence of prices, that does not imply OCR will catch up with CCR. What I see happening now (and which I feel will continue to last) is a falling of the premium CCR has over RCR and OCR. Again, this is due to decreasing significance of the district demarcation zones - in the past, the premium CCR has over OCR could be 300%. Now it could be 200% or even less.

If I am an investor from overseas with some hot money to burn, would I choose a 1000sq ft apartment at 2500psf (knowing that there are many units still unsold) or would I get 3 3-bedders with great views of greenery in, say District 23? Or even 2 penthouses for that matter.

[proud owner]

I think your comment applies to yourself. I never once said OCR can hit past 3000psf. When we talk about convergence of prices, that does not imply OCR will catch up with CCR. What I see happening now (and which I feel will continue to last) is a falling of the premium CCR has over RCR and OCR. Again, this is due to decreasing significance of the district demarcation zones - in the past, the premium CCR has over OCR could be 300%. Now it could be 200% or even less.

If I am an investor from overseas with some hot money to burn, would I choose a 1000sq ft apartment at 2500psf (knowing that there are many units still unsold) or would I get 3 3-bedders with great views of greenery in, say District 23? Or even 2 penthouses for that matter.

if i am an investor from oversea with money to burn .. i wont consider D23 either


MBS will be first choice .. then maybe Reflections , sentosa

probably not even D9/10 ...D11 is out as well

[devilplate]

if i am an investor from oversea with money to burn .. i wont consider D23 either


MBS will be first choice .. then maybe Reflections , sentosa

probably not even D9/10 ...D11 is out as well

tats y spread ur eggs into diff locations....:cheers6:

[Regulators]

I spoke to an agent last time and he told me those rich indonesian investors snapped up units at centris and various condos in the suburbs apart from condos in the ccr. These investors are astute and they buy a basket of properties in various locations around or island, not just in prime districts
if i am an investor from oversea with money to burn .. i wont consider D23 either


MBS will be first choice .. then maybe Reflections , sentosa

probably not even D9/10 ...D11 is out as well

[proud owner]

I spoke to an agent last time and he told me those rich indonesian investors snapped up units at centris and various condos in the suburbs apart from condos in the ccr. These investors are astute and they buy a basket of properties in various locations around or island, not just in prime districts

thats becos they already have alot in the prime districts .. so buy some outside ccr

as a new investor coming in for first time i really doubt they would go outside ccr for their first investment

[Wild Falcon]

Actually i know of some Indonesians preferring to invest in mass/mid than luxury now. Very surprised as well.


thats becos they already have alot in the prime districts .. so buy some outside ccr

as a new investor coming in for first time i really doubt they would go outside ccr for their first investment

[teddybear]

There are a few things you didn't consider:

1) This is your first property? Otherwise why down payment is 20% and not 30%? So ROI much lower (also have not considered costs as in (2)). If so, first and only property how to be for investment & not for own stay?

2) You have to consider that if you sell:
+ Legal fees $3000+
+ buyer stamp duty 3%
+ seller stamp duty 3% (if sell within 1 year)
+ agent fee 1%

3) For mass market properties, smaller unit always higher $PSF. So you can't take 2-rm $PSF for comparison. Also, their unit may be renovated (hence can sell at higher price) while yours aren't.

4) Advertised is just that - "advertised". Wait till you sell at that price first.

5) You think you hold 20 years still got value?

6) Built by FEO in 1997(?), too many rumours about poor quality (can't prove real or not but sure have effect on buyers' mentality towards the estate) and don't think people will buy at premium from you. Don't think the rental yield can sustain going forward?

7) Too many people make money from 1 deal and subsequently lose bigger money in other deals (not to mention your profit is not already in the bag since you have not sold. To sell, you need to incur all the costs mentioned in (2)). Too early to trumpet yet.

8) Govt still have lots of land in Bukit Batok / HillView / Upper Bukit Timah / Bukit Panjang areas, supply can be quite huge even if price rises, so nett can't expect big price increase. MRT effect already factored in.


bro, don't have to talk about other people's investment. Let me use the regent heights unit i bought 1 week ago for analysis. I bought my 1163sf 3 bedder for 770k with superb orientation and views and on very high floor. Look at what people are advertising now for a 2 bedder (http://www.propertyguru.com.sg/listing/2851942/for-sale-regent-heights) (http://www.propertyguru.com.sg/listing/2851942/for-sale-regent-heights%29). If This unit is indeed sold for 800k (28k less than the price advertised), that will act as a baseline for my larger 3 bedroom unit to sell at 880k or more. If I were to relaunch my unit for sale in the market at 880k (have checked with UOB that can support 8xxk), that will be 105k gross profit (not counting other cost yet). that may not be a lot to you in absolute terms, but that is 67% gross return on investment of 20% downpayment, not in 1 year, but in less than 1 month. Would you consider an ROI of more than 60% in 1 month lousy? I do not intend to sell even though my latest investment has appreciated in value in 1 week by 13.5%, as rental yield of 4.9% is a more attractive proposition to me.

[teddybear]

UOB KayHian
Property – Singapore
Greater divergence ahead between private and public housing

What’s New
• Urban Redevelopment Authority’s (URA) flash estimates indicate that
private home prices increased 2.7% qoq in 4Q10, hitting another all-time
high of 194.8. The pace of increase was slightly lower than the 2.9% qoq
increase in 3Q10. For 2010, the price index as a whole rose 17.6% with
prices rebounding 48% from the bottom of 2Q09. Public housing prices
advanced at a slower pace of 2.4% qoq in 4Q10 compared to 4% qoq in
the previous quarter.
Action
• The signs of stabilisation in the public housing segment will ease the
mounting policy pressure. However, we prefer exposure to the high-end
segment which is less susceptible to government measures and the price
growth is expected to continue outpacing the mass and mid-tier
segments. Wing Tai is our top pick for the high-end segment.

Essentials
• High-end segment price increase outpaces other segments. During
4Q10, prices in high-end rose 2.3% qoq, outpacing the 1.7% and 1.6%
qoq increase in the mid- and mass market segments respectively. Prices
in the mass, mid- and high-end segment are currently 19%, 11% and 2%
above 2008 peak levels. For 2011, we expect the high-end segment
prices to continue outpacing the mass/mid-tier segments, rising 8-10%
compared to flattish growth for the other segments. Further price
increases in the mass market segment are capped by affordability
constraints which are creeping back to the long-term average of 46%
(43% in 3Q10) despite the extremely low interest rate environment.

[hopeful]

thats becos they already have alot in the prime districts .. so buy some outside ccr

as a new investor coming in for first time i really doubt they would go outside ccr for their first investment

Actually i know of some Indonesians preferring to invest in mass/mid than luxury now. Very surprised as well.

I concur, my own relatives CCR first and then RCR/OCR from 2009 onwards. As for me, I am core D1,D2,D9,D10 fan.

[mantrix]

if i am an investor from oversea with money to burn .. i wont consider D23 either


MBS will be first choice .. then maybe Reflections , sentosa

probably not even D9/10 ...D11 is out as well

exactly my point - i used a district as an example that was non-CCR that's all.

What I was saying was that CCR no longer has the appeal or desirability it used to command...

[sh]

exactly my point - i used a district as an example that was non-CCR that's all.

What I was saying was that CCR no longer has the appeal or desirability it used to command...

CCR will be attractive to inventors for the simple reason that the units are easier to lease out than non CCR. Cash flow is important too for investors. :)

[stalingrad]

CCR will be attractive to inventors for the simple reason that the units are easier to lease out than non CCR. Cash flow is important too for investors. :)

before you said that, you should've checked propetyguru to see how many units in ccr are for rent and have been left unoccupied for months. my friend's casabella unit has been collecting ants for 4 months. no one even phoned.

[teddybear]

That is not the only reason, there are several others:
1) If a person has $50m to invest in properties, is he going to buy 5 properties of $10m each which is easier to manage or 50 properties of $1m each? How to manage 50 properties?

2) Cheap properties are usually rented to tenants who don't take care, have to deal with these tenants who are always not paying on time, and disappearing frequently etc. The security deposit are always insufficient to cover the repairs when they left, and you may have to rent to several co-tenants and deal with them rather than just 1 tenant etc.


CCR will be attractive to inventors for the simple reason that the units are easier to lease out than non CCR. Cash flow is important too for investors. :)

[sh]

before you said that, you should've checked propetyguru to see how many units in ccr are for rent and have been left unoccupied for months. my friend's casabella unit has been collecting ants for 4 months. no one even phoned.

ok point noted....

Let me rephrase that. Investor's should invest in properties that are in demand from tenants. eg properties near MRT, preferably in the CCR :D

[stalingrad]

teddy, your common sense arguments always make me laugh.

have you heard of diversification; i.e., don't put all your eggs in one basket? if you invest all your 2 million in rivergate or duchess residences, you may go months without any rental income. if you put your 2 millions in two OCR condos, you are sure to get some rental income. that is just common sense.

[sh]

That is not the only reason, there are several others:
1) If a person has $50m to invest in properties, is he going to buy 5 properties of $10m each which is easier to manage or 50 properties of $1m each? How to manage 50 properties?

2) Cheap properties are usually rented to tenants who don't take care, have to deal with these tenants who are always not paying on time, and disappearing frequently etc. The security deposit are always insufficient to cover the repairs when they left, and you may have to rent to several co-tenants and deal with them rather than just 1 tenant etc.

$10m dollar properties give lousy returns leh:(
50MMs will give much better return :) Let the agents run around for you lor... if you have 50mil.

Don't want to deal will cheap tenants that come with cheap properties....

Hmmm.... i'm very hard to please.... too cheap also cannot, too ex also cannot....:banghead: Have to find sweet spot between the 2....

1mil MM in CCR near MRT leased to single professional would be about right....:D

[teddybear]

Ha ha ha! So funny. Sure get some rental income? Ok ok. When tenant left, your rental income + security deposit barely sufficient to repair all the damages done to make the place fit for next tenant. Think you don't have such experience before. :p


teddy, your common sense arguments always make me laugh.

have you heard of diversification; i.e., don't put all your eggs in one basket? if you invest all your 2 million in rivergate or duchess residences, you may go months without any rental income. if you put your 2 millions in two OCR condos, you are sure to get some rental income. that is just common sense.

[teddybear]

Let agent manage all 50 properties? Think you better get a reliable professional otherwise your rental money will disappear hor, and you get invoice for repairs that never occurred etc. :cheers1:


$10m dollar properties give lousy returns leh:(
50MMs will give much better return :) Let the agents run around for you lor... if you have 50mil.

Don't want to deal will cheap tenants that come with cheap properties....

Hmmm.... i'm very hard to please.... too cheap also cannot, too ex also cannot....:banghead: Have to find sweet spot between the 2....

1mil MM in CCR near MRT leased to single professional would be about right....:D

[kane]

Quality of tenant is really down to individual luck. I heard of a corporate tenant in a quality project, almost tore the place apart. Lucky owner can claim against the company.

[kane]

Let agent manage all 50 properties? Think you better get a reliable professional otherwise your rental money will disappear hor, and you get invoice for repairs that never occurred etc. :cheers1:

Invoices from shell companies?? :cheers1:

[kingkong1984]

All these are crap when u have CCR owners buying OCR properties. Of course CCR will go up. The mid point between the rich and the poor hdb folks. OCR is the middle class.

[mantrix]

If I have 50million, I am looking more at cap appreciation since I have holding power.

Will probably buy 2 GCBs or maybe 4-5 landed properties if I really need to invest in properties.

Gotta be realistic come on - teddy you really need to stop giving those extreme examples lah...those may be commonplace in another universe ;)

[sh]

Let agent manage all 50 properties? Think you better get a reliable professional otherwise your rental money will disappear hor, and you get invoice for repairs that never occurred etc. :cheers1:

That's the price to pay for being lazy.... :)

with 50 property, you can hire someone full time to manage them....

dream on....:rolleyes:

[Regulators]

you don't need to educate people about stamp duty, legal fees etc as these are things everyone here knows. I bought with 80% loan coz my other properties are all fully paid. I have been debtless for a long time until my recent RH purchase.

You mentioned that govt has a lot of land in bukit batok for residential housing, you may perhaps enlighten us on which plots? As far as i know, apart from the jade, the next closest condo to bt batok mrt is regent heights and i don't see any land within a 1km radius of bt batok mrt which is suitable to build a condo development. I think you are just speaking from the top of your head with little or no insight. You seem quite ignorant of the fact that new developments tend to jack up prices of surrounding older projects, which was why investors bought the treehouse in anticipation of that. caspian owners will also stand to gain with the launching of lakefront in case you are not aware.

UOB valued a similar 3 bedder to mine for 860k and based on the current market this is considered cheap, with a 614sf one bedder at tennery already asking for 8xxk before discount. If I sell at 880k, the GROSS ROI is 71.4% and the NET ROI after taking bank compensation, stamp duty and all the misc fees is about 50%. In thecurrent market, a 2 bedder above #20 in RH is already asking for the price i paid for my 3 bedder so i have made a safe bet. If i were to hold my unit for the next 20 years, by then my mortgage would have been fully paid or almost. Taking a conservative gross rental income for my unit to be 3k, converts to gross returns of 720k after 20 years. With 65 - 68 more years left on the lease, i will be sitting on positive equity after 20 years and a posibility of an en bloc. I am not interested in a measly profit even if i am able to flip my unit next week, my horizon of investment for this unit is long term.


There are a few things you didn't consider:

1) This is your first property? Otherwise why down payment is 20% and not 30%? So ROI much lower (also have not considered costs as in (2)). If so, first and only property how to be for investment & not for own stay?

2) You have to consider that if you sell:
+ Legal fees $3000+
+ buyer stamp duty 3%
+ seller stamp duty 3% (if sell within 1 year)
+ agent fee 1%

3) For mass market properties, smaller unit always higher $PSF. So you can't take 2-rm $PSF for comparison. Also, their unit may be renovated (hence can sell at higher price) while yours aren't.

4) Advertised is just that - "advertised". Wait till you sell at that price first.

5) You think you hold 20 years still got value?

6) Built by FEO in 1997(?), too many rumours about poor quality (can't prove real or not but sure have effect on buyers' mentality towards the estate) and don't think people will buy at premium from you. Don't think the rental yield can sustain going forward?

7) Too many people make money from 1 deal and subsequently lose bigger money in other deals (not to mention your profit is not already in the bag since you have not sold. To sell, you need to incur all the costs mentioned in (2)). Too early to trumpet yet.

8) Govt still have lots of land in Bukit Batok / HillView / Upper Bukit Timah / Bukit Panjang areas, supply can be quite huge even if price rises, so nett can't expect big price increase. MRT effect already factored in.

[Regulators]

you are right. Any idiot would know that when an investor buys for rental yield, they would usually look for RCR/OCR rather than CCR. It is so much easier to buy 2 OCR condos at 750k and rent out at 3k each compared to paying 1.5 mil for a mickey mouse apartment in D9 and and renting it out for 6k a month. Buying into a branded district does not necessarily make good rental investment.


teddy, your common sense arguments always make me laugh.

have you heard of diversification; i.e., don't put all your eggs in one basket? if you invest all your 2 million in rivergate or duchess residences, you may go months without any rental income. if you put your 2 millions in two OCR condos, you are sure to get some rental income. that is just common sense.

[reuters]

you don't need to educate people about stamp duty, legal fees etc as these are things everyone here knows. I bought with 80% loan coz my other properties are all fully paid. I have been debtless for a long time until my recent RH purchase.

You mentioned that govt has a lot of land in bukit batok for residential housing, you may perhaps enlighten us on which plots? As far as i know, apart from the jade, the next closest condo to bt batok mrt is regent heights and i don't see any land within a 1km radius of bt batok mrt which is suitable to build a condo development. I think you are just speaking from the top of your head with little or no insight. You seem quite ignorant of the fact that new developments tend to jack up prices of surrounding older projects, which was why investors bought the treehouse in anticipation of that. caspian owners will also stand to gain with the launching of lakefront in case you are not aware.

UOB valued a similar 3 bedder to mine for 860k and based on the current market this is considered cheap, with a 614sf one bedder at tennery already asking for 8xxk before discount. If I sell at 880k, the GROSS ROI is 71.4% and the NET ROI after taking bank compensation, stamp duty and all the misc fees is about 50%. In thecurrent market, a 2 bedder above #20 in RH is already asking for the price i paid for my 3 bedder so i have made a safe bet. If i were to hold my unit for the next 20 years, by then my mortgage would have been fully paid or almost. Taking a conservative gross rental income for my unit to be 3k, converts to gross returns of 720k after 20 years. With 65 - 68 more years left on the lease, i will be sitting on positive equity after 20 years and a posibility of an en bloc. I am not interested in a measly profit even if i am able to flip my unit next week, my horizon of investment for this unit is long term.

Teddy, is your RH rented out already? Are there really takers for the area in Bukit Batok? How much is it going for (rental)?

[Regulators]

i intend to rent out for 3.5k fully furnished. if can't get it at 3.5k i will settle for 3k in the worst case scenario. 2bedders are being rented out for 2.7k to 2.9k so i am very optimistic as my unit is on high floor in the premium tower of the premium stack. my completion is some time in March so will start looking for tenant closer to that date.


Teddy, is your RH rented out already? Are there really takers for the area in Bukit Batok? How much is it going for (rental)?

[reuters]

i intend to rent out for 3.5k fully furnished. if can't get it at 3.5k i will settle for 3k in the worst case scenario. 2bedders are being rented out for 2.7k to 2.9k so i am very optimistic as my unit is on high floor in the premium tower of the premium stack. my completion is some time in March so will start looking for tenant closer to that date.

Do you think there really will be a scenario in the next 1-2 years when more condos TOP and people start lowering their rentals by a big margin because they cannot find rentals? What's your opinion of condos in West Coast, East Coast and Balestier? Will they still be attractive to prospective tenants?

[Regulators]

Rental in west coast will not be very fantastic as there isnt much of a heartland appeal with the standard malls, eateries and amenities. As for east coast, too many mini boutique apartments up for rent, so i think larger condos like One Amber, Silversea, Costa Del Sol etc will be best to attract good yields. It has been donkey years and despite having no MRT nearby, you still find Bayshore and Bayshore Park a favourite among expats. Many expats like living in big enclosed communities with full condo facilities so such properties are good for rental. All those tiny developments in TK may be hard to satisfy tenants unless close to Kembangan MRT. Those renting Balestier will be those tenants who do not want to pay ridiculous rentals for D9, 10 and 11 and yet want a reasonable proximity to town.

Whether there will be a price drop in rental very much depends on the location of the condo. If there are only 2 condos within 700m radius of bukit batok central and many tenants want to live in this estate, then it is the landlord's call when it comes to pricing. There is no point telling people there are many condos in hillview or jurong renting cheaper when tenants want to live in bukit batok. Condo rentals in HDB estates must also look at HDB rentals in the vicinity. If a 5 rm hdb flat in bt batok central is already renting for 2.5k, it would be much easier for a 2 bedder condo near the central to ask for 2.7-2.8k and a 3 bedder in the same condo to ask for 3k or more. My friend who owns a 3 bedder at hillington used to rent his unit for 4k a month some years back to a European expat and when rental fell, he renewed the rental for 3k plus a month.



Do you think there really will be a scenario in the next 1-2 years when more condos TOP and people start lowering their rentals by a big margin because they cannot find rentals? What's your opinion of condos in West Coast, East Coast and Balestier? Will they still be attractive to prospective tenants?

[proud owner]

you are right. Any idiot would know that when an investor buys for rental yield, they would usually look for RCR/OCR rather than CCR. It is so much easier to buy 2 OCR condos at 750k and rent out at 3k each compared to paying 1.5 mil for a mickey mouse apartment in D9 and and renting it out for 6k a month. Buying into a branded district does not necessarily make good rental investment.

often times, it depends on the agents showing the units ...

i have expats colleagues , who by default, use the company's appointed agent .. and the agents always show them prime districts at very high rental ...

i always "sabo' the agent by telling these expats colleagues to ask to view condos outside prime districts (outside 9,10,11)

they were amazed by the price differences and that some of these outside areas were actually good locations or have good amenities ..

so if you have agents who only want to show prime locations to incoming renters, cos they get 2mths comms for a 2 yr lease ..of course they want you to rent the most expensive ones ..

i dunno abt other company, but for mine, say if i like a unit thats above my housing allowance, i can nego for a higher allowance ...

so to say whether prime easier to rent or ocr easier to rent ... no clear answer

[Regulators]

from what i understand about corporate rentals, how much rental allowance the employee gets depends on his ranking and position in the company. Companies used to rent properties on behalf of their employees, but these days, it is much easier for companies to just give rental allowance and not be bound by the tenancy agreement which can be messy. Rental allowances vary but i believe some expats have only enough to rent OCR properties.


often times, it depends on the agents showing the units ...

i have expats colleagues , who by default, use the company's appointed agent .. and the agents always show them prime districts at very high rental ...

i always "sabo' the agent by telling these expats colleagues to ask to view condos outside prime districts (outside 9,10,11)

they were amazed by the price differences and that some of these outside areas were actually good locations or have good amenities ..

so if you have agents who only want to show prime locations to incoming renters, cos they get 2mths comms for a 2 yr lease ..of course they want you to rent the most expensive ones ..

i dunno abt other company, but for mine, say if i like a unit thats above my housing allowance, i can nego for a higher allowance ...

so to say whether prime easier to rent or ocr easier to rent ... no clear answer

[kingkong1984]

Rent CCR at a high price if money coming from employer. If given fixed allowance, likely renting OCR region. International schools is a key link. Enclave of race is another and brand new furnished preferred.

Blue horizon was very popular with japanese due to Japanese schools near by. But only up to varsity park, botannia etc top. They like to stay together and would not mind slightly higher rents.

No sure winners in CCR or OCR. It has to be bought with the possible buyers in mind if intended as an investment. Self stay gain on inflation. Capital gains are brought by key commercial, public amenities and population demand for that area.

Sentosa cove, cheap before IR. IR up and price up.
The sail cheap due to SARS. IR up, price up.
Nex up, price up for tat area.
New university up, price up for tat area
MRT link news, price up
MRT up, price up
TOP, price up

But price down are not so clear as most would ask for matching valuation.

[teddybear]

I have no RH. I wll be nuts & an idiot to buy such property (as they have no long-term investment value). :cheers1:


Teddy, is your RH rented out already? Are there really takers for the area in Bukit Batok? How much is it going for (rental)?

[hopeful]

you are right. Any idiot would know that when an investor buys for rental yield, they would usually look for RCR/OCR rather than CCR. It is so much easier to buy 2 OCR condos at 750k and rent out at 3k each compared to paying 1.5 mil for a mickey mouse apartment in D9 and and renting it out for 6k a month. Buying into a branded district does not necessarily make good rental investment.

Who buys purely for rental yield anyway?
Capital gains is the way to make money.
Rental is only to sustain the mortgage.

How come nobody ever answer my questions?
1) you make more money from net rental or from capital appreciation?
2) Those of you who goes for rental yield, you never hope for capital appreciation?

[devilplate]

Who buys purely for rental yield anyway?
Capital gains is the way to make money.
Rental is only to sustain the mortgage.

How come nobody ever answer my questions?
1) you make more money from net rental or from capital appreciation?
2) Those of you who goes for rental yield, you never hope for capital appreciation?
I only buy when i feel its undervalued n yet yield is good.... In short i go for both combi.... Sgs bond much safer at ard 3 pct.... Might as well go for tat if purely looking at rental yield

[hopeful]

I only buy when i feel its undervalued n yet yield is good.... In short i go for both combi.... Sgs bond much safer at ard 3 pct.... Might as well go for tat if purely looking at rental yield
That is my point. Owners here seems to put the emphasis on rental yield and nothing else but rental yield.
99LH cheaper, better rental yield blah blah.....
At the end of the day, when do you make most of your money from?
The simple answer is: When you sell your property. - that's when you make the bulk of your money.
Most people here take mortgages to buy properties. Please calculate your NETT yield, don't talk about GROSS. After 10 years, how much money you accumulate from NETT yield? Is that even enough to put downpayment for another condo????

[devilplate]

That is my point. Owners here seems to put the emphasis on rental yield and nothing else but rental yield.
99LH cheaper, better rental yield blah blah.....
At the end of the day, when do you make most of your money from?
The simple answer is: When you sell your property. - that's when you make the bulk of your money.
Most people here take mortgages to buy properties. Please calculate your NETT yield, don't talk about GROSS. After 10 years, how much money you accumulate from NETT yield? Is that even enough to put downpayment for another condo????

but if yield is bad....it may also indicates tat it is overpriced

[hopeful]

but if yield is bad....it may also indicates tat it is overpriced
was Orchard Road FH yield ever the same as like hmmmm, some OCR LH condos or for more extreme comparison, Orchard Road FH yield ever higher than HDBs? in 1990s,2000s?
so Orchard Road FH is perpetually overpriced as compared to HDB?

[devilplate]

was Orchard Road FH yield ever the same as like hmmmm, some OCR LH condos or for more extreme comparison, Orchard Road FH yield ever higher than HDBs? in 1990s,2000s?
so Orchard Road FH is perpetually overpriced?

nvr owned luxury....but D11 ppty like those near UE sq, novena sq can achieved 3-4% yield...tats norm...if below tat mabe overpriced....so goto compared its past performance to make a judgement

[hopeful]

nvr owned luxury....but D11 ppty like those near UE sq, novena sq can achieved 3-4% yield...tats norm...if below tat mabe overpriced....so goto compared its past performance to make a judgement

That's right, compare within a segment, then across segments. Then can find out underpriced or overpriced.
But the key objective of us all is to make money. And most money is made from capital gains rather than nett rental yield. So look at properties which has potential from capital gains rather than net rental yield. Rental yield is just a tiny bonus for those who have difficulties making mortgage payments.

[devilplate]

That's right, compare within a segment, then across segments. Then can find out underpriced or overpriced.
But the key objective of us all is to make money. And most money is made from capital gains rather than nett rental yield. So look at properties which has potential from capital gains rather than net rental yield. Rental yield is just a tiny bonus for those who have difficulties making mortgage payments.

er...if u sell to next investor...u goto make sure the yield still acceptable at ur selling price aso mah.....so yield hf direct impact on ur capital gains in future

[hopeful]

er...if u sell to next investor...u goto make sure the yield still acceptable at ur selling price aso mah.....so yield hf direct impact on ur capital gains in future

Let say my gross yield in 2009 is 4%, which is market rate. Rent out for 2 years. Condo is $1mil.
In 2010 january, property market now rising. I want to sell for $1.1mil. so yield now drop to 3.63% for next owner. So now nobody want to buy from me?
What do you propose I do?
A) Wait until end 2010 when the tenancy expired and sell? So new buyer can rent out at 4% yield.
B) sell at $1.05mil in 2010 january, yield for buyer is 3.81%.
C) hope for property market to crash, so that I sell at 900k. Yield for next owner is 4.44%.

[devilplate]

Let say my gross yield in 2009 is 4%, which is market rate. Rent out for 2 years. Condo is $1mil.
In 2010 january, property market now rising. I want to sell for $1.1mil. so yield now drop to 3.63% for next owner. So now nobody want to buy from me?
What do you propose I do?
A) Wait until end 2010 when the tenancy expired and sell? So new buyer can rent out at 4% yield.
B) sell at $1.05mil in 2010 january, yield for buyer is 3.81%.
C) hope for property market to crash, so that I sell at 900k. Yield for next owner is 4.44%.
i suppose rental shd go in tandem with prices....if not, den bubble is forming...hehe....so right now, no bubble yet:cheers6:

[Regulators]

With regard to capital appreciation, the value of the RH unit appreciated in price from what i paid almost instantly as the unit i bought was underpriced. I bought RH to park my money there rather than to let it waste away in the bank. I could pay off the entire mortgage now if i wanted, but i chose to let the future rental pay off this unit i bought. If you do your math, it will take me only 20 years or less to full pay the remaining 80% of my loan from the rental alone and would you say that a property with 65yr left has no value? The price that i sell the condo then will be the profit you are talking about. Investors buying properties for rental do not realise profit the same way that investors who buy for capital appreciation do. Moreover with 65yr remaining, a good location and a big piece of land, there is potential for en bloc in future.


Who buys purely for rental yield anyway?
Capital gains is the way to make money.
Rental is only to sustain the mortgage.

How come nobody ever answer my questions?
1) you make more money from net rental or from capital appreciation?
2) Those of you who goes for rental yield, you never hope for capital appreciation?

[hyenergix]

I see a lot of postings and passionate discussions on rental yield. I guess many buyers are not buying for own stay. I can imagine the competition for tenants get hotter if the immigration number stays around 2010 level in 2011 and 2012.

[hopeful]

.......Investors buying properties for rental do not realise profit the same way that investors who buy for capital appreciation do. .......

Hi, I am interested to know more about the above statement.
How does investors buying properties for rental realise profit as compared to investors who buy for capital appreciation?

Care to explain? I am willing to learn.

But the core of your posting above, is still capital appreciation right?

[Regulators]

Extracted from my last post: "If you do your math, it will take me only 20 years or less to full pay the remaining 80% of my loan from the rental alone and would you say that a property with 65yr left has no value? The price that i sell the condo then will be the profit you are talking about."


Hi, I am interested to know more about the above statement.
How does investors buying properties for rental realise profit as compared to investors who buy for capital appreciation?

Care to explain? I am willing to learn.

But the core of your posting above, is still capital appreciation right?

[Regulators]

The rationale is this, to an owner who has fully paid off his house using mortgage, do you think the owner would be very concerned about that 10% drop in his property price when it is time for him to sell? This is when owners can still make money even when there is no capital appreciation. Investors buying for rental all have that same mentality. If along the way comes en bloc, it will just be an icing on the cake.


Hi, I am interested to know more about the above statement.
How does investors buying properties for rental realise profit as compared to investors who buy for capital appreciation?

Care to explain? I am willing to learn.

But the core of your posting above, is still capital appreciation right?

[blackfire]

Theoretically for investment property, rental yield is directly related to capital appreciation. Reasons why some properties prices rises faster than rental yield are either (1) property market is experiencing some form of speculation activity or (2) The property has some unique features which caters more for owner occupation or long term investment. For example the rental yield for landed properties is low compared to condo, but the prices are still climbing due to fact that you are sitting on a real piece of land, which people valued, especially Asians. Another example is The Sail, the rental yield is not attractive now but there is anticipation that the surrounding area once redeveloped, will attract higher rental and property prices.

As for whether to buy for rental yield or capital appreciation, it depends on whether you are long term investors or short term investors or speculators. If you are just looking at capital appreciation alone, you are running the risk of property market making a sudden downturn and you are not able to command a good rental to buy time. For long term investors of more than 3 years, it is better to invest in good yield units. For bullish short term basis, investors should look for capital appreciation. For owner occupation or other personal reasons, rental yield may not be very important.

[Wild Falcon]

Rental yields does affect capital value over time. If a property gives 5% yields, over time investors will realise its capital value is under-valued such that it will normalise to "normal" yields of say 3%. It's like high-yielding stocks hold their capital value very well because it has strong cash flows. Rental = cash flows. And if you value the capital of any asset, it should be based on the discounted value of future cash flows. So to say rental (which is like dividend) has no impact on capital is really naive. who will buy a property dreaming of capital gains where there is no good cash flows to support the equity value? Of course u will use the usual "foreign hot monies" like to anyhow invest without looking at future cash flows, well, foreign hot monies sometimes are not dumb.

i still find it amusing people keep saying i don't care rental cash flows because capital values will increase without future cash flows. Really? Take some financial classes and u will realise that cash flows is everything.

And seriously, do you think there is that much capital gains at today's prices? some properties only fetching 2% yields. If capital value goes up further, it will fall to 1%. And capital gains (not supported by current cash flows) will only happen to areas with new developments, e.g. second CBD, new tranport links etc. Those fetching 2% yields TODAY and NO future prospect, the investors are only looking at investing for a bigger bubble and looking for bigger idiots to buy their property.


Who buys purely for rental yield anyway?
Capital gains is the way to make money.
Rental is only to sustain the mortgage.

How come nobody ever answer my questions?
1) you make more money from net rental or from capital appreciation?
2) Those of you who goes for rental yield, you never hope for capital appreciation?

[Regulators]

that is why i believe in buying a property with a good rental yield. The higher the yield, the greater the likelihood (i didn't say absolute) that the property is undervalued. Average yield for private should be around 3% so anything in the region of 4-5% will ring some bells.


Rental yields does affect capital value over time. If a property gives 5% yields, over time investors will realise its capital value is under-valued such that it will normalise to "normal" yields of say 3%. It's like high-yielding stocks hold their capital value very well because it has strong cash flows. Rental = cash flows. And if you value the capital of any asset, it should be based on the discounted value of future cash flows. So to say rental (which is like dividend) has no impact on capital is really naive. who will buy a property dreaming of capital gains where there is no good cash flows to support the equity value? Of course u will use the usual "foreign hot monies" like to anyhow invest without looking at future cash flows, well, foreign hot monies sometimes are not dumb.

i still find it amusing people keep saying i don't care rental cash flows because capital values will increase without future cash flows. Really? Take some financial classes and u will realise that cash flows is everything.

And seriously, do you think there is that much capital gains at today's prices?

[devilplate]

that is why i believe in buying a property with a good rental yield. The higher the yield, the greater the likelihood (i didn't say absolute) that the property is undervalued. Average yield for private should be around 3% so anything in the region of 4-5% will ring some bells.

so ideally, go for FH+4-5% yield? hold 20-30yrs sure make $?:D

[Regulators]

ideally, yes :)



so ideally, go for FH+4-5% yield? hold 20-30yrs sure make $?:D

[stalingrad]

Value derives from what it can generate over times in yield. without yield, value is shit. simple as that.

[kingkong1984]

The rationale is this, to an owner who has fully paid off his house using mortgage, do you think the owner would be very concerned about that 10% drop in his property price when it is time for him to sell? This is when owners can still make money even when there is no capital appreciation. Investors buying for rental all have that same mentality. If along the way comes en bloc, it will just be an icing on the cake.

The points that I agree on

a) Fully paid mortgage, dun bother about price up or down. Only if price has increased a lot for him to cream it then he will sell, if not, it is better off to hold them for rental yield. Enblock is jackpot. Never enblock, hold for rent and even properties with 30 yr old has its value.

b) Buying at $100k below value is already a winner. Sell at value would give some profits too.

c) No condo properties should be rented at less than HDB prices. $2k no problem. Of course can ask for more.

d) Housing is one thing that when many people chasing, it will go up. When no body chasing, it will go down. No sell means NO PAIN.

[blackfire]

Rental yields does affect capital value over time. If a property gives 5% yields, over time investors will realise its capital value is under-valued such that it will normalise to "normal" yields of say 3%. It's like high-yielding stocks hold their capital value very well because it has strong cash flows. Rental = cash flows. And if you value the capital of any asset, it should be based on the discounted value of future cash flows. So to say rental (which is like dividend) has no impact on capital is really naive. who will buy a property dreaming of capital gains where there is no good cash flows to support the equity value? Of course u will use the usual "foreign hot monies" like to anyhow invest without looking at future cash flows, well, foreign hot monies sometimes are not dumb.

i still find it amusing people keep saying i don't care rental cash flows because capital values will increase without future cash flows. Really? Take some financial classes and u will realise that cash flows is everything.

And seriously, do you think there is that much capital gains at today's prices? some properties only fetching 2% yields. If capital value goes up further, it will fall to 1%. And capital gains (not supported by current cash flows) will only happen to areas with new developments, e.g. second CBD, new tranport links etc. Those fetching 2% yields TODAY and NO future prospect, the investors are only looking at investing for a bigger bubble and looking for bigger idiots to buy their property.

Share like GLP, which do not provide dividend now doesn't mean it doesn't have a growth story. Similarly for properties, a low rental yield now can still command a high price if there is a "growth" story behind it, eg future MRT, university,CBD, etc,etc, which will eventually command a higher rental.

At the end of the day whether your property investment make money depends whether your property is in demand when you decided to sell it, be it rental, owner occupation or investment.

As I said, for investment properties, it is better to buy good yield properties, which can weathered the market downturn longer. unless personally you have some reasons like "foresight" or insider information on the surrounding development in the future, then you look at capital appreciation alone.

[teddybear]

Actually, properties with super high rental yield usually have low capital appreciation! That is it! It is true! In order to entice buyers to buy properties with low potential capital appreciation, sellers have no choice but to sell at lower price to ensure reasonable to high rental yield! (This theory is same as buying stocks! High yield stocks have high yield because investors think they have potentially low capital appreciation in terms of share price!).

After understanding the above, is it any wonder that OCR properties tend to have slightly higher rental yield than CCR? (and yet OCR properties not necessary all the time have better yield and yet difficult to get good tenants - all these make it even more sucks!).


Let say my gross yield in 2009 is 4%, which is market rate. Rent out for 2 years. Condo is $1mil.
In 2010 january, property market now rising. I want to sell for $1.1mil. so yield now drop to 3.63% for next owner. So now nobody want to buy from me?
What do you propose I do?
A) Wait until end 2010 when the tenancy expired and sell? So new buyer can rent out at 4% yield.
B) sell at $1.05mil in 2010 january, yield for buyer is 3.81%.
C) hope for property market to crash, so that I sell at 900k. Yield for next owner is 4.44%.

[stalingrad]

teddy is the kind of person that buy bonds when interest rates are heading higher.

[devilplate]

Actually, properties with super high rental yield usually have low capital appreciation! That is it! It is true! In order to entice buyers to buy properties with low potential capital appreciation, sellers have no choice but to sell at lower price to ensure reasonable to high rental yield! (This theory is same as buying stocks! High yield stocks have high yield because investors think they have potentially low capital appreciation in terms of share price!).

After understanding the above, is it any wonder that OCR properties tend to have slightly higher rental yield than CCR? (and yet OCR properties not necessary all the time have better yield and yet difficult to get good tenants - all these make it even more sucks!).

hahahaha

den y OCR increased so much since 2008??? high yield+high gain leh...u missed it rite....too bad for u:p

[hopeful]

The rationale is this, to an owner who has fully paid off his house using mortgage, do you think the owner would be very concerned about that 10% drop in his property price when it is time for him to sell? This is when owners can still make money even when there is no capital appreciation. Investors buying for rental all have that same mentality. If along the way comes en bloc, it will just be an icing on the cake.

Let me get this straight.
Assuming you pay 200k for a $1mil condo, take loan 80% for 20 years.
Assuming the rental can fully cover mortgage + other expenses, so that in 20 years, the loan is fully repaid.

so in 20 years time, fully paid up, and if sell at $900k, you still make 900k-200k = 700k profit? instead of 100k loss.
Since your initial cash outlay is 200k.

Let me chew on this.
What a foreign concept :ashamed1:

[hopeful]

How come nobody chasing industrial or shophouses or retail lots properties since they have higher yields? not withstanding that is a residential property forum.
In what situation does a person sell his HDB flat? Since rental yield is the highest of all residential properties?
So is that one reason why HDB flats are going up and up since yield is so high.

[Regulators]

interesting you said that, coz that is also on my agenda. I am looking out at a freehold office/retail space somewhere within 1 min of cityhall mrt station entrance. yet to find my ideal unit.


How come nobody chasing industrial or shophouses or retail lots properties since they have higher yields? not withstanding that is a residential property forum.
In what situation does a person sell his HDB flat? Since rental yield is the highest of all residential properties?

[devilplate]

How come nobody chasing industrial or shophouses or retail lots properties since they have higher yields? not withstanding that is a residential property forum.
In what situation does a person sell his HDB flat? Since rental yield is the highest of all residential properties?
So is that one reason why HDB flats are going up and up since yield is so high.

i cannot own a HDB for eg....got restrictions leh....if one can buy many many HDB....HDB prices will at least go up by another 30% almost immediately or OCR ppty will fall...lol

been hearing industrial/retail ppty giving 8-10% yield wor....any experts here? but mostly 30-60yr lease rite?

[devilplate]

interesting you said that, coz that is also on my agenda. I am looking out at a freehold office/retail space somewhere within 1 min of cityhall mrt station entrance. yet to find my ideal unit.

mostly FH ones r shophse leh...i see liao faint...duno rent to who type...lol

[gn108]

HDB is like a stock with someone holding a veto Golden share.
HDB yield is high for many reasons - you own only the space, not the land. Ownership is restricted and rental is subject to policy changes anytime.

On the other end, is FH in CCR - those can have yields just straddling mortgage rates as these are where the big boys play.


How come nobody chasing industrial or shophouses or retail lots properties since they have higher yields? not withstanding that is a residential property forum.
In what situation does a person sell his HDB flat? Since rental yield is the highest of all residential properties?
So is that one reason why HDB flats are going up and up since yield is so high.

[hopeful]

i cannot own a HDB for eg....got restrictions leh....if one can buy many many HDB....HDB prices will at least go up by another 30% almost immediately or OCR ppty will fall...lol

been hearing industrial/retail ppty giving 8-10% yield wor....any experts here? but mostly 30-60yr lease rite?

10% yield, payback in how many years? so why not popular?
Thought there was an article in December, of a lady who invested in many industrial properties...around 400k per unit

[hopeful]

interesting you said that, coz that is also on my agenda. I am looking out at a freehold office/retail space somewhere within 1 min of cityhall mrt station entrance. yet to find my ideal unit.

I am looking at Boatquay & Circular shophouses, FH somemore. Looking for ideal unit also, ie within my budget :) But at the price they are asking, yield is like 5% only.

[gn108]

For retail try Lucky Plaza or Far East in Orchard
Or Holland Road Shopping Centre in HV for D10.
Freehold/Strata titled.


interesting you said that, coz that is also on my agenda. I am looking out at a freehold office/retail space somewhere within 1 min of cityhall mrt station entrance. yet to find my ideal unit.

[hopeful]

HDB is like a stock with someone holding a veto Golden share.
HDB yield is high for many reasons - you own only the space, not the land. Ownership is restricted and rental is subject to policy changes anytime.

On the other end, is FH in CCR - those can have yields just straddling mortgage rates as these are where the big boys play.

What is the difference between HDB and LH condos?
Since both of them are leases.
buy HDB, lease flat for 99yrs? buy LH condo, lease building and land for 99years?
Any practical difference in terms of ownership?

[Regulators]

for retail space, i would avoid holland road shopping centre. That place is practically dead on weekends and they close very early as well. If they don't spruce up the place and extend the opening hours, with or without the MRT there makes no dif. Lucky Plaza and Far East can consider, but very expensive now.


For retail try Lucky Plaza or Far East in Orchard
Or Holland Road Shopping Centre in HV for D10.
Freehold/Strata titled.

[devilplate]

What is the difference between HDB and LH condos?
Since both of them are leases.
buy HDB, lease flat for 99yrs? buy LH condo, lease building and land for 99years?
Any practical difference in terms of ownership?

for HDB owners....they r called lessee.....strictly speaking...they rent it from HDB for 99yrs only

99LH condo, u own the land for 99yrs....can sell enbloc to developer

[Regulators]

yes. For LH HDB, govt can top up the lease as and when they want. It would be impractical for the govt tear down 80% of HDB flats closer to 99yr so i believe they will rather top up the lease. For LH condos, the only option is en bloc when the condo gets too old. I have yet to come across a condo whereby all the owners vote to top up the lease back to 99yr again. Not forgetting the history of singapore is on 45 yrs so there is a lot to be seen.


What is the difference between HDB and LH condos?
Since both of them are leases.
buy HDB, lease flat for 99yrs? buy LH condo, lease building and land for 99years?
Any practical difference in terms of ownership?

[blackfire]

How come nobody chasing industrial or shophouses or retail lots properties since they have higher yields? not withstanding that is a residential property forum.
In what situation does a person sell his HDB flat? Since rental yield is the highest of all residential properties?
So is that one reason why HDB flats are going up and up since yield is so high.

Commercial and Industrial properties do often better yield and good investments. I would recommend to those who own numerous residential properties to diversify their investment to such properties. My personal favorite is coffeeshops. However, one must bear in mind, that commercial and industrial properties are a total different asset class as compared to residential. The nature, the risk involved, tenant profile are very different from residential. Your tenants are businessmen who are more adverse to economical cycle. Bank charge higher interest rates, pay GST (unless u buy under a pte ltd) , no CPF and loan approval is strict with lower LTV. Also banks more likely to ask for top up than residentials. Such investment are not for beginners or with no holding power unless for your own business use.

[teddybear]

So what conclusion can you draw? I see that the OCR property price is waiting for a pin to drop and prick the balloon (eh, 'bubble' - that is what Govt called it since introducing countless cooling measures, the last one on 30 Aug 2010), just a matter of time. Illusion of high yield high gain can only last so long :cheers1:


hahahaha

den y OCR increased so much since 2008??? high yield+high gain leh...u missed it rite....too bad for u:p

[hopeful]

yes. For LH HDB, govt can top up the lease as and when they want. It would be impractical for the govt tear down 80% of HDB flats closer to 99yr so i believe they will rather top up the lease. For LH condos, the only option is en bloc when the condo gets too old. I have yet to come across a condo whereby all the owners vote to top up the lease back to 99yr again. Not forgetting the history of singapore is on 45 yrs so there is a lot to be seen.

Hmmm, that is a ticking time bomb isn't it. HDB just celebrated 1mil flats built last December.
So in HDB's case, who pay for the top up lease? Can residents reject? Just like upgrading exercise?

This is just like an oil palm plantation.
Initially, companies do the land clearing and plant all the trees within a period of 3 years, as fast as possible.
However, when it is time to replanting, companies don't cut down and plant all the trees at the same time, as time to harvest is about 3 years, and no income for the next 3 years.
Instead as trees approached 25 years old, 5-10% of the trees are cut down and replanted. So cash flow is not much affected.
I suspect the same will be done for HDB flats, maybe small % is demolished every year.

[Regulators]

As of now, you just have to concede defeat :D


So what conclusion can you draw? I see that the OCR property price is waiting for a pin to drop and prick the balloon (eh, 'bubble' - that is what Govt called it since introducing countless cooling measures, the last one on 30 Aug 2010), just a matter of time. Illusion of high yield high gain can only last so long :cheers1:

[stalingrad]

So what conclusion can you draw? I see that the OCR property price is waiting for a pin to drop and prick the balloon (eh, 'bubble' - that is what Govt called it since introducing countless cooling measures, the last one on 30 Aug 2010), just a matter of time. Illusion of high yield high gain can only last so long :cheers1:
why is it an illusion? if the government's measures cause the OCR prices to drop, wouldn't that cause the yield to go even higher?

[teddybear]

Is investing so simple as lower price means higher yield? Higher yield don't guarantee higher profit! No wonder that you are not-CCR investor. If all CCR property buyers believe this way, there will not be any CCR property buyer! Is there any wonder that CCR buyers/owners are always so rich? No because they understand the above that you don't. :p


why is it an illusion? if the government's measures cause the OCR prices to drop, wouldn't that cause the yield to go even higher?

[hopeful]

why is it an illusion? if the government's measures cause the OCR prices to drop, wouldn't that cause the yield to go even higher?

at current rental rates maybe, but for new tenants? would new tenants pay higher rental?
So prices drop good or not good for current owners? future owners?

[hopeful]

Is investing so simple as lower price means higher yield? Higher yield don't guarantee higher profit! No wonder that you are not-CCR investor. If all CCR property buyers believe this way, there will not be any CCR property buyer! Is there any wonder that CCR buyers/owners are always so rich? No because they understand the above that you don't. :p

Teddybear, be careful about cause and effect.
Buyers become rich after they buy and sell CCR
or buyers because they are already rich, can buy CCR.

[orange]

Hdb celebrated 1 millionth flat built.

Soon they will be celebrating the first $1m flat sold.

Can't see why they would be even half-serious about clamping down on property prices. High prices are to their interests after all, as they know that demand is very much still there and there are many who would readily pay for it. Whether they are stupid or just simply too rich, up to you to decide.

The men behind the scenes are probably clapping mr mah bow tan on the back, despite the public show of regret.

So much hypocrisy, all of it is to please that vocal minority, who aren't complaining now.

[stalingrad]

at current rental rates maybe, but for new tenants? would new tenants pay higher rental?
So prices drop good or not good for current owners? future owners?
price drops will not be good for current owners, of course. but that is not my point. my point is that the rental yield is real, and will be even more real if the prices drop.

I was just pulling teddy's chain. His arguments are so full of holes, they look like cheese to me.

[orange]

Yuck! You pulled some dick cheese off his chain!

[teddybear]

Cause - I am teaching people from my experience.
Effect - I got cursed by some? :banghead:
For good karma, I still have to say the truth of what I believe in and from my experience. If I keep quiet despite all the fallacies being put forward by those others that curse me then may be I will be accumulating bad karma? (their cursing will has no effect because good karma will prevail) :cheers1:

Your 2 statements feed into each other: so buy CCR become richer, richer can buy more CCR, buy more and more become richer and richer.................(repeat)............... :D


Teddybear, be careful about cause and effect.
Buyers become rich after they buy and sell CCR
or buyers because they are already rich, can buy CCR.

[hopeful]

for HDB owners....they r called lessee.....strictly speaking...they rent it from HDB for 99yrs only

99LH condo, u own the land for 99yrs....can sell enbloc to developer

Besides ability to enbloc, is there any practical difference between HDB and LH.
Sorry, being a foreigner, not very sure of what is difference.

In Indonesia, if you rent out a shophouse for 2 years. You get cash 2 years worth of rental straightaway and not month-by-month or year-by-year.
So it seems to me that Singaporeans are paying out rental for 99year lumpsum at the beginning of the 99 year rental for a HDB flat? And since it is "rental", cannot do much of anything without the owners' (HDB) permission?

For LH, owners if they want to, can tear down and built a new condo in place, even if only 50years left on the lease?
For HDB, no such ability?

[blackfire]

Hdb celebrated 1 millionth flat built.

Soon they will be celebrating the first $1m flat sold.

Can't see why they would be even half-serious about clamping down on property prices. High prices are to their interests after all, as they know that demand is very much still there and there are many who would readily pay for it. Whether they are stupid or just simply too rich, up to you to decide.

The men behind the scenes are probably clapping mr mah bow tan on the back, despite the public show of regret.

So much hypocrisy, all of it is to please that vocal minority, who aren't complaining now.

My opinon is that the greatest and the smartest thing the Singapore govt has done is the creation of HDB. With HDB, everyone in Singapore has a roof over their head, no slums or squatters in Singapore , unlike everywhere else in the world. It is seriously a feat to house 80% of the population in public housing, nobody needs to live in the streets in Singapore. This is really amazing and have to give credit to HDB.

Years ago, govt committed to make HDB an appreciating assets for retirement,etc, especially for the lower income group. This decision makes HDB policies highly politically since. It is very difficult to make the flat prices to rise continuously, and yet make it affordable for everyone. The whole economy has to keep expanding. Questions on govt subsidies, etc etc also arises. HDB dwellers also afraid to vote of oppositions in case their HDB estates are neglected. HDB has over years evolved to be a political tool and not just an assets or simply a basic home. As for existing properties owners, u certainly hope that the govt will continue to protect the HDB prices, if not the domino effect on the private properties here can be very serious, bearing in mind the HDB is the biggest landlord in Singapore.

[august]

My opinon is that the greatest and the smartest thing the Singapore govt has done is the creation of HDB. With HDB, everyone in Singapore has a roof over their head, no slums or squatters in Singapore , unlike everywhere else in the world. It is seriously a feat to house 80% of the population in public housing, nobody needs to live in the streets in Singapore. This is really amazing and have to give credit to HDB.

Years ago, govt committed to make HDB an appreciating assets for retirement,etc, especially for the lower income group. This decision makes HDB policies highly politically since. It is very difficult to make the flat prices to rise continuously, and yet make it affordable for everyone. The whole economy has to keep expanding. Questions on govt subsidies, etc etc also arises. HDB dwellers also afraid to vote of oppositions in case their HDB estates are neglected. HDB has over years evolved to be a political tool and not just an assets or simply a basic home. As for existing properties owners, u certainly hope that the govt will continue to protect the HDB prices, if not the domino effect on the private properties here can be very serious, bearing in mind the HDB is the biggest landlord in Singapore.
80% of population sounds impressive, but the numbers are not huge compared to other countries since Spore has a small population.

everything is not that impressive once u realise a city state is way easier to govern than a country.

i certainly dun think the current management deserve any credit at all :tongue3:

[land118]

[quote=blackfire]My opinon is that the greatest and the smartest thing the Singapore govt has done is the creation of HDB. With HDB, everyone in Singapore has a roof over their head, no slums or squatters in Singapore , unlike everywhere else in the world. It is seriously a feat to house 80% of the population in public housing, nobody needs to live in the streets in Singapore. This is really amazing and have to give credit to HDB.
...quote] We are lucky that as citizens, we have a chance to apply for HDB flats, unlike many of the less fortunate in Africa of many other parts of the world, where they literally use anything they can find to have a shelter over their heads....

[hopeful]

80% of population sounds impressive, but the numbers are not huge compared to other countries since Spore has a small population.

everything is not that impressive once u realise a city state is way easier to govern than a country.

i certainly dun think the current management deserve any credit at all :tongue3:

What are the comparables to Singapore?
Monaco? HK? Lichstentein?

[blackfire]

[quote=blackfire]My opinon is that the greatest and the smartest thing the Singapore govt has done is the creation of HDB. With HDB, everyone in Singapore has a roof over their head, no slums or squatters in Singapore , unlike everywhere else in the world. It is seriously a feat to house 80% of the population in public housing, nobody needs to live in the streets in Singapore. This is really amazing and have to give credit to HDB.
...quote] We are lucky that as citizens, we have a chance to apply for HDB flats, unlike many of the less fortunate in Africa of many other parts of the world, where they literally use anything they can find to have a shelter over their heads....

I would said not just Africa, but practically in almost every country and city in the world, developed, developed or not developed, you will certainly find homeless people on the streets, whereas in Singapore it is very rare.

HDB has also made our govt job very easy. Urban planning can be done easily by locating or relocating the residents in accordance to the govt's plan. The flats and surrounding are also very well kept which make residents wonder if the MP were to change, will things be different.

Imagine Singapore without HDB. I guess most likely we would be like central London, Shanghai or Tokyo, whereby most people cannot afford their own home. On the other hand, there maybe more oppositions in the parliament, as most voters will no longer concern about preserving the value of their HDBs.

[azeoprop]

Wow! Its only 5th Jan 2011 and we are at page 8 liaoz haa haa....:scared-3:

[EBD]

What is the difference between HDB and LH condos?
Since both of them are leases.
buy HDB, lease flat for 99yrs? buy LH condo, lease building and land for 99years?
Any practical difference in terms of ownership?

HDB rule can be changed anytime. Condo seems less meddling by govt. , but is still open to it by changing deposit amount.

[sh]

Is investing so simple as lower price means higher yield? Higher yield don't guarantee higher profit! No wonder that you are not-CCR investor. If all CCR property buyers believe this way, there will not be any CCR property buyer! Is there any wonder that CCR buyers/owners are always so rich? No because they understand the above that you don't. :p

errr... this CCR investor also believes in high yield hence CCR MMs...:)

I look at high yield as a criteria for investing for a simple reason.

High current yield is like a bird at hand. it is real.

Potential capital gain is like 2 birds in the bush.

I rather have the bird at hand.

Who is to say that high yielding properties will have less potential capital gain potential? Property prices generally move in tandem, regardless of yield.

So, I like to have my cake and eat it too:D

[Regulators]

i think this CCR MM investor is sweating when he thinks of what kind of yield he will be getting for his MM unit. As he waits indefinitely for his 1000psf increase in his property price, others are already realising gains in OCR.


errr... this CCR investor also believes in high yield hence CCR MMs...:)

I look at high yield as a criteria for investing for a simple reason.

High current yield is like a bird at hand. it is real.

Potential capital gain is like 2 birds in the bush.

I rather have the bird at hand.

Who is to say that high yielding properties will have less potential capital gain potential? Property prices generally move in tandem, regardless of yield.

So, I like to have my cake and eat it too:D

[sh]

i think this CCR MM investor is sweating when he thinks of what kind of yield he will be getting for his MM unit. As he waits indefinitely for his 1000psf increase in his property price, others are already realising gains in OCR.

This CCR MM investor is happy with the yield he is getting.:)

What's to say that he hasn't benefited from gains?:tsk-tsk:

If you buy a unit trust. There is always a disclaimer that says "past performance is not a indication of future performance". The same applies for property.

[Regulators]

he is disgruntled that OCR has witnessed some phenomenal growth in 2010 while the growth of his property in the CCR is not seeing as much. Human nature to feel that way so i understand :D


This CCR MM investor is happy with the yield he is getting.:)

What's to say that he hasn't benefited from gains?:tsk-tsk:

If you buy a unit trust. There is always a disclaimer that says "past performance is not a indication of future performance". The same applies for property.

[sh]

he is disgruntled that OCR has witnessed some phenomenal growth in 2010 while the growth of his property in the CCR is not seeing as much. Human nature to feel that way so i understand :D

Actually, he just acquired his CCR MM, so he is happy that CCR hasn't "witnessed phenomenal growth" yet :D

[Regulators]

CCR MM should be quite easy to rent out, but MM in the OCR might have some problems. Anyway, when CCR starts to move, it should bring up the general property market in singapore.


Actually, he just acquired his CCR MM, so he is happy that CCR hasn't "witnessed phenomenal growth" yet :D

[bullman]

i think this CCR MM investor is sweating when he thinks of what kind of yield he will be getting for his MM unit. As he waits indefinitely for his 1000psf increase in his property price, others are already realising gains in OCR.

That is an inherent problem from buying any MM units. Even at a fantastic $500 psf profit, the quantum gain is modest.

I bought a 441 sqft at Illuminaire at 1.7k + psf during the launch in 2009. The last transacted is around 2.2k. The net quantum gain is around 200k. Rental yield wise, it should fetch 5-5.5%.

[Wild Falcon]

Read my post again. I've already said if you're not looking at rental, then look at FUTURE DEVELOPMENT POTENTIAL of an area. But they all translate to ONE THING - future cash flows. There are some areas that has NEITHER rental yield OR anymore future development potential or growth. I'm not going to highlight which locality. You just have to find your own investment strategy. If rental is not important, so be it. Then make sure u invest in a growth area with new MRT, new downtown etc. But for me, I try to invest in something that gives me both strong recurring cash flows and capital gains.


Share like GLP, which do not provide dividend now doesn't mean it doesn't have a growth story. Similarly for properties, a low rental yield now can still command a high price if there is a "growth" story behind it, eg future MRT, university,CBD, etc,etc, which will eventually command a higher rental.

At the end of the day whether your property investment make money depends whether your property is in demand when you decided to sell it, be it rental, owner occupation or investment.

As I said, for investment properties, it is better to buy good yield properties, which can weathered the market downturn longer. unless personally you have some reasons like "foresight" or insider information on the surrounding development in the future, then you look at capital appreciation alone.

[teddybear]

Based on your reasoning, Central London zone 1 should sell at cheapest price compared to other zones because it has almost zero future development potential since already fully built up! :doh:


Read my post again. I've already said if you're not looking at rental, then look at FUTURE DEVELOPMENT POTENTIAL of an area. But they all translate to ONE THING - future cash flows. There are some areas that has NEITHER rental yield OR anymore future development potential or growth. I'm not going to highlight which locality. You just have to find your own investment strategy. If rental is not important, so be it. Then make sure u invest in a growth area with new MRT, new downtown etc. But for me, I try to invest in something that gives me both strong recurring cash flows and capital gains.

[blackfire]

Read my post again. I've already said if you're not looking at rental, then look at FUTURE DEVELOPMENT POTENTIAL of an area. But they all translate to ONE THING - future cash flows. There are some areas that has NEITHER rental yield OR anymore future development potential or growth. I'm not going to highlight which locality. You just have to find your own investment strategy. If rental is not important, so be it. Then make sure u invest in a growth area with new MRT, new downtown etc. But for me, I try to invest in something that gives me both strong recurring cash flows and capital gains.

Why u got so defensive and rude? I didn't say you are wrong in my post. I just add on to what you have said. Please read my post again.

[DaytonaSS]

Actually, he just acquired his CCR MM, so he is happy that CCR hasn't "witnessed phenomenal growth" yet :D

sh dont mind share where did u buy? congrats on your purchase btw :)

[DaytonaSS]

But for me, I try to invest in something that gives me both strong recurring cash flows and capital gains.

i think everyone wants that :), the best of both world.

[sh]

sh dont mind share where did u buy? congrats on your purchase btw :)

private information lah...:)

[reuters]

CCR MM should be quite easy to rent out, but MM in the OCR might have some problems. Anyway, when CCR starts to move, it should bring up the general property market in singapore.

East Coast and Balestier are considered OCR right? What are their potential for capital appreciation since they are not CCR nor exactly very far away in OCR?

[DaytonaSS]

private information lah...:)

hahah , okie okie. Given the fire powder going ard, just share the district ba : )

[sh]

hahah , okie okie. Given the fire powder going ard, just share the district ba : )

district 9, near MRT. that's all I can say

[DaytonaSS]

CCR MM should be quite easy to rent out, but MM in the OCR might have some problems. Anyway, when CCR starts to move, it should bring up the general property market in singapore.

Actually agree on your point. OCR supports might not like to hear this, but IMHO , $1100-1200 psf for OCR hit ceiling for now already. For the price to move to next lvl, i feel CCR must chong sky high.

For this phenomenon to happen, Singapore got to lure in the foreign buyers. As a proven Property guru friend's sharing- OCR is Oysters for Singaporean. while CCR playground is for the world's privileged, whom the millions price tag will not put a dent in their pocket and loved living near/NEXT to orchard belt, or up n coming Sentosa Story.

While many OCR supports shoot down CCR and vice versa, i view it as a cycle. Now PRAY for CCR to shoot past the sky and it will bring OCR / RCR to a new high.

[Regulators]

bro, by saying this you will make a particular CCR MM owner's head even more swollen here.


As a proven Property guru friend's sharing- OCR is Oysters for Singaporean. while CCR playground is for the world's privileged, whom the millions price tag will not put a dent in their pocket and loved living near/NEXT to orchard belt, or up n coming Sentosa Story.

[Regulators]

200k in one over years not bad for an MM, if you had bought 5 units at illum in 2009, that would be a cool 1 mil profit in one over yr


That is an inherent problem from buying any MM units. Even at a fantastic $500 psf profit, the quantum gain is modest.

I bought a 441 sqft at Illuminaire at 1.7k + psf during the launch in 2009. The last transacted is around 2.2k. The net quantum gain is around 200k. Rental yield wise, it should fetch 5-5.5%.

[DaytonaSS]

bro, by saying this you will make a particular CCR MM owner's head even more swollen here.

CCR also got many price range, from 2000 psf to 4000 psf. For example i just go check The Marq selling price, OMG $4K to 4.5k psf, average quantum $12m. This kind of price is definitely the "privileged", dont u agree?

Society is like that one mah. Supposing a pretty chick u just meet in party, pretty chick :"So where do u stay?".
MM owner : "Orchard Road"

- result : Impressed. Unless the pretty chick ask, "MM or not??!!!" :doh:

we are so shallow right? Anyone wanna agrue this point, just look at your gf/wife. Same reason y all gals will have at least 1 Prada/LV/Chanel/.... Branded.

[rattydrama]

200k in one over years not bad for an MM, if you had bought 5 units at illum in 2009, that would be a cool 1 mil profit in one over yr

That will mean you need to have around 900K of cold hard cash for the 5 units with 80% loan. How many of us will throw towel in 2009?

Same question, will anyone buy 5 units of CCR MM units now?

[rattydrama]

we are so shallow right? Anyone wanna agrue this point, just look at your gf/wife. Same reason y all gals will have at least 1 Prada/LV/Chanel/.... Branded.

Well after owning a few BRANDED, no longer interested to have more... it corresponds with one's age and personal preference as you age. I would prefer to keep more golds or silver instead.

[DaytonaSS]

Well after owning a few BRANDED, no longer interested to have more... it corresponds with one's age and personal preference as you age. I would prefer to keep more golds or silver instead.

Well, congrats for "arriving" :scared-5: . " no longer interested to have more indicates "arrived" . No need to argue which is better, just own a few in each region :eek:

[kane]

I used to love the idea of living in orchard area in the 90s. But now it's become so crowded. I prefer to spend my weekends in the suburbs unless there's something I need to get that's not available elsewhere. One man's meat as another man's poison. But having said that, I think all property prices regardless of region have a good chance of chucking along in 2011.

[rattydrama]

This is by far the best concept (from regulators). This shows that one is in control of his investment & cash - its like wearing a bullet proof jacket. To say CCR or OCR will chiong like no tomorrow remains to be true only when it really comes.;)

to further add

look for lowest psf & low quantum as compared to the surroundings,
look for rental yield around ~4%
look at absolute rental quantum per month (avg of $3K - not too difficult to get in centralized areas)
make sure decent size - wider choice for tenants
look for upside potential
low quantum which you can pay off pretty quickly and leave behind some spare cash for future investment opportunity:scared-3: wow very solid
en-bloc etc......


Let me get this straight.
Assuming you pay 200k for a $1mil condo, take loan 80% for 20 years.
Assuming the rental can fully cover mortgage + other expenses, so that in 20 years, the loan is fully repaid.

so in 20 years time, fully paid up, and if sell at $900k, you still make 900k-200k = 700k profit? instead of 100k loss.
Since your initial cash outlay is 200k.

Let me chew on this.
What a foreign concept :ashamed1:

[rattydrama]

I used to love the idea of living in orchard area in the 90s. But now it's become so crowded. I prefer to spend my weekends in the suburbs unless there's something I need to get that's not available elsewhere. One man's meat as another man's poison. But having said that, I think all property prices regardless of region have a good chance of chucking along in 2011.

That is how I feel as well. During the early 90s, going to Orchard Road is a big thing and looking forward. Now, Orchard Road is very crowded and I only go there to see Christmas lighting once a year or if there is visitor around.

Most of the time, I will try to avoid.. even the lawyer office for my property transaction is dealt with at Toa Payoh HDB Hub.:cool:

[DaytonaSS]

I used to love the idea of living in orchard area in the 90s. But now it's become so crowded. I prefer to spend my weekends in the suburbs unless there's something I need to get that's not available elsewhere. One man's meat as another man's poison. But having said that, I think all property prices regardless of region have a good chance of chucking along in 2011.

Don't mind I ask ah, where not crowded? Only place I drive ard not crowded is in sentosa cove. Ultra beautiful community.

Imagine 7m population. The thought send chills down my spine. Maybe then pay n pay will start developing lim chu kang. As the population swells , there is only 1 direction the price is heading. Qns is approve PR faster or building housing faster. All the office space being build in marina area needs pple to fill up.

[Regulators]

you speak like you were around long before singapore got its independence. I value the experience of people in that era. I am certain Property Owner is one such guru that came up from that era.


Well after owning a few BRANDED, no longer interested to have more... it corresponds with one's age and personal preference as you age. I would prefer to keep more golds or silver instead.

[kane]

Suburban malls are not as crowded. With the exception of Nex. That's one madhouse right now. If I have to go to orchard. I'll go to Centrepoint, not popular with the tourist or the young crowd. Otherwise, go to places like the zoo or reservoir. Weekends isn't just for shopping and hanging around town.

[rattydrama]

Don't mind I ask ah, where not crowded? Only place I drive ard not crowded is in sentosa cove. Ultra beautiful community.

Imagine 7m population. The thought send chills down my spine. Maybe then pay n pay will start developing lim chu kang. As the population swells , there is only 1 direction the price is heading. Qns is approve PR faster or building housing faster. All the office space being build in marina area needs pple to fill up.
No need to go all the way to Lim Chu Kang, there are still empty lands in Yishun, Sembawang and Woodlands. Should have enough to fill the 7m.

Right now, solving the housing issues for the newly weds. It looks promising that the population will start to increase.

[DaytonaSS]

No need to go all the way to Lim Chu Kang, there are still empty lands in Yishun, Sembawang and Woodlands. Should have enough to fill the 7m.

Right now, solving the housing issues for the newly weds. It looks promising that the population will start to increase.

3 district to hold 1.5m more pple? It's sounds damn scary! The 3 area seems to need to travel through CTE to get to town. Now that pay n pay got lots of ERP on CTE, it does sound like good idea to help ring in the $$$$.

If lim chi kang sell land, I go buy a small plot. Keep for 3 generation. :scared-1:

[kane]

3 district to hold 1.5m more pple? It's sounds damn scary! The 3 area seems to need to travel through CTE to get to town. Now that pay n pay got lots of ERP on CTE, it does sound like good idea to help ring in the $$$$.

If lim chi kang sell land, I go buy a small plot. Keep for 3 generation. :scared-1:
It's probably LH so at best you can only keep it for 2 generation.:cheers1:

[reuters]

Suburban malls are not as crowded. With the exception of Nex. That's one madhouse right now. If I have to go to orchard. I'll go to Centrepoint, not popular with the tourist or the young crowd. Otherwise, go to places like the zoo or reservoir. Weekends isn't just for shopping and hanging around town.

I have friends with kids and above 40s who will avoid Orchard on weekends, but I still prefer to walk around ION, Taka, Paragon, 313@Somerset because the environment is more 'happening'. Recently the Shoppes at MBS are also picking up some momentum! Looks like another hotspot for those who love shopping and having dinners. Given a choice, I will now prefer to live nearer to MBS than Orchard.

[rattydrama]

you speak like you were around long before singapore got its independence. I value the experience of people in that era. I am certain Property Owner is one such guru that came up from that era.


haha got out of context, its in response to DaytonaSS post on BRANDED PRADA....Oops.....

I value the experience of the seniors in that era - they are in a time of uncertainty. Those people who make it big in property have guts and foresight.

SG to become Switzerland of the East. Lets hope.:spliff:

[rattydrama]

3 district to hold 1.5m more pple? It's sounds damn scary! The 3 area seems to need to travel through CTE to get to town. Now that pay n pay got lots of ERP on CTE, it does sound like good idea to help ring in the $$$$.

If lim chi kang sell land, I go buy a small plot. Keep for 3 generation. :scared-1:


Do you think the 1.5m will all go to these 3 areas? Dont forget our MMs in CCR hor. Devilplate might want to sell his.

[rattydrama]

I have friends with kids and above 40s who will avoid Orchard on weekends, but I still prefer to walk around ION, Taka, Paragon, 313@Somerset because the environment is more 'happening'. Recently the Shoppes at MBS are also picking up some momentum! Looks like another hotspot for those who love shopping and having dinners. Given a choice, I will now prefer to live nearer to MBS than Orchard.

will you pay to stay in MBS or have some spare cash to invest in another property?

[DaytonaSS]

I have friends with kids and above 40s who will avoid Orchard on weekends, but I still prefer to walk around ION, Taka, Paragon, 313@Somerset because the environment is more 'happening'. Recently the Shoppes at MBS are also picking up some momentum! Looks like another hotspot for those who love shopping and having dinners. Given a choice, I will now prefer to live nearer to MBS than Orchard.

There are simply too many choices now! There is no way u can get tired of any 1 place, cos u got no chance to!! too little time, too many new shopping centers to visit. I love places like VIVO city, Dempsy hill, orchard emerald drinking belt, RWS and maybe in time to come MBS.

[DaytonaSS]

will you pay to stay in MBS or have some spare cash to invest in another property?

From my personal experience and observation, after u stay near MBS or RWS, chances are, one will not have mush spare cash to invest in any other assets :tsk-tsk:

[rattydrama]

I love my NTUC supermarket, GMarket/ebay and Sutera Mall in Taman Sutera Utama (Malaysia)

[rattydrama]

From my personal experience and observation, after u stay near MBS or RWS, chances are, one will not have mush spare cash to invest in any other assets :tsk-tsk:

liquidate and buy 2 units at other district? - cheaper to get a car?

[reuters]

will you pay to stay in MBS or have some spare cash to invest in another property?

hmm.... very hard to say actually (at least for me). That's because MBS is such a massive project that it takes so much more effort to build something of the same scale elsewhere, taking into consideration all other infrastructure and businesses around the area like Esplanade theatres, the F1 pit, Gardens by the Bay. And we have not really seen the full scale of this development because of all the construction going on at Marina South. And I am forever extremely curious what they are going to do to that deliciously precious plot of land at Marina East. From the map, it looks as big as a town and is sitting on prime land, though reclaimed. The potential of the entire downtown and a bit towards both east and west is incredible because this is getting to resemble the downtown Manhattan model - prime apartments getting smaller too.

If it is for investment, I feel that rental yield is not the way to make money, but to help us hold the property. I prefer a property that can attract rental, such that as long as the rent is enough to cover the installments and potential future interest hike, that is good enough. The only way to make money from a property investment is when we invest ahead of some potential developments to the place that will cause the price to increase. So for that matter, perhaps Bedok town centre area (no condos yet) or Jurong East might be good to invest in, though I often wonder who will rent the apartment from me if I buy there - will expats want to stay in the neighbourhood? I am not experienced enough to understand the demography of the tenants in these areas so I tend to prefer buying a reasonably new condo where I can physically see the space and the people living there.

That's why I look at central (expensive), north (too far. will I really attract tenants?), south (expensive), west (too near construction industry, not exactly cheap and not much lifestyle attractions), east (expensive, but not that expensive yet. no mrt yet for most stretch of east coast). - i ended up looking seriously at East Coast in the end.

[reuters]

will you pay to stay in MBS or have some spare cash to invest in another property?

hmm.... very hard to say actually (at least for me). That's because MBS is such a massive project that it takes so much more effort to build something of the same scale elsewhere, taking into consideration all other infrastructure and businesses around the area like Esplanade theatres, the F1 pit, Gardens by the Bay. And we have not really seen the full scale of this development because of all the construction going on at Marina South. And I am forever extremely curious what they are going to do to that deliciously precious plot of land at Marina East. From the map, it looks as big as a town and is sitting on prime land, though reclaimed. The potential of the entire downtown and a bit towards both east and west is incredible because this is getting to resemble the downtown Manhattan model - prime apartments getting smaller too.

If it is for investment, I feel that rental yield is not the way to make money, but to help us hold the property. I prefer a property that can attract rental, such that as long as the rent is enough to cover the installments and potential future interest hike, that is good enough. The only way to make money from a property investment is when we invest ahead of some potential developments to the place that will cause the price to increase. So for that matter, perhaps Bedok town centre area (no condos yet) or Jurong East might be good to invest in, though I often wonder who will rent the apartment from me if I buy there - will expats want to stay in the neighbourhood? I am not experienced enough to understand the demography of the tenants in these areas so I tend to prefer buying a reasonably new condo where I can physically see the space and the people living there.

That's why I look at central (expensive), north (too far. will I really attract tenants?), south (expensive), west (too near construction industry, not exactly cheap and not much lifestyle attractions), east (expensive, but not that expensive yet. no mrt yet for most stretch of east coast). - i ended up looking seriously at East Coast in the end.

[hopeful]

Does anybody here play Monopoly, Singapore edition?
What is the most expensive property in the Singapore edition?

[stalingrad]

hmm.... very hard to say actually (at least for me). That's because MBS is such a massive project that it takes so much more effort to build something of the same scale elsewhere, taking into consideration all other infrastructure and businesses around the area like Esplanade theatres, the F1 pit, Gardens by the Bay. And we have not really seen the full scale of this development because of all the construction going on at Marina South. And I am forever extremely curious what they are going to do to that deliciously precious plot of land at Marina East. From the map, it looks as big as a town and is sitting on prime land, though reclaimed. The potential of the entire downtown and a bit towards both east and west is incredible because this is getting to resemble the downtown Manhattan model - prime apartments getting smaller too.

If it is for investment, I feel that rental yield is not the way to make money, but to help us hold the property. I prefer a property that can attract rental, such that as long as the rent is enough to cover the installments and potential future interest hike, that is good enough. The only way to make money from a property investment is when we invest ahead of some potential developments to the place that will cause the price to increase. So for that matter, perhaps Bedok town centre area (no condos yet) or Jurong East might be good to invest in, though I often wonder who will rent the apartment from me if I buy there - will expats want to stay in the neighbourhood? I am not experienced enough to understand the demography of the tenants in these areas so I tend to prefer buying a reasonably new condo where I can physically see the space and the people living there.

That's why I look at central (expensive), north (too far. will I really attract tenants?), south (expensive), west (too near construction industry, not exactly cheap and not much lifestyle attractions), east (expensive, but not that expensive yet. no mrt yet for most stretch of east coast). - i ended up looking seriously at East Coast in the end.

east coast sounds nice. but the whole area has become a red light district. china mei mei galore there.

[proud owner]

haha got out of context, its in response to DaytonaSS post on BRANDED PRADA....Oops.....

I value the experience of the seniors in that era - they are in a time of uncertainty. Those people who make it big in property have guts and foresight.

SG to become Switzerland of the East. Lets hope.:spliff:


switzerland of the east ?

in what sense ?

no NS ?
high salary?
high tax?
short work hr?
make watch?
ski resorts ?
send a few NS men to guard Vatican ?

what abt switzerland we trying to emulate?

[hopeful]

Let me get this straight.
Assuming you pay 200k for a $1mil condo, take loan 80% for 20 years.
Assuming the rental can fully cover mortgage + other expenses, so that in 20 years, the loan is fully repaid.

so in 20 years time, fully paid up, and if sell at $900k, you still make 900k-200k = 700k profit? instead of 100k loss.
Since your initial cash outlay is 200k.

Let me chew on this.
What a foreign concept :ashamed1:

Still chewing on this.
Anybody here with accountancy or economics background?
What does an accountant say about the profit?
What does an economist say about the profit?
is it profit of 700k or loss 100k?

[devilplate]

Still chewing on this.
Anybody here with accountancy or economics background?
What does an accountant say about the profit?
What does an economist say about the profit?
is it profit of 700k or loss 100k?

nid to calculate the annual pct returns.....see whether above inflation anot....to me anything beats inflation is a winner:D

[ay123]

hmm.... very hard to say actually (at least for me). That's because MBS is such a massive project that it takes so much more effort to build something of the same scale elsewhere, taking into consideration all other infrastructure and businesses around the area like Esplanade theatres, the F1 pit, Gardens by the Bay. And we have not really seen the full scale of this development because of all the construction going on at Marina South. And I am forever extremely curious what they are going to do to that deliciously precious plot of land at Marina East. From the map, it looks as big as a town and is sitting on prime land, though reclaimed. The potential of the entire downtown and a bit towards both east and west is incredible because this is getting to resemble the downtown Manhattan model - prime apartments getting smaller too.

If it is for investment, I feel that rental yield is not the way to make money, but to help us hold the property. I prefer a property that can attract rental, such that as long as the rent is enough to cover the installments and potential future interest hike, that is good enough. The only way to make money from a property investment is when we invest ahead of some potential developments to the place that will cause the price to increase. So for that matter, perhaps Bedok town centre area (no condos yet) or Jurong East might be good to invest in, though I often wonder who will rent the apartment from me if I buy there - will expats want to stay in the neighbourhood? I am not experienced enough to understand the demography of the tenants in these areas so I tend to prefer buying a reasonably new condo where I can physically see the space and the people living there.

That's why I look at central (expensive), north (too far. will I really attract tenants?), south (expensive), west (too near construction industry, not exactly cheap and not much lifestyle attractions), east (expensive, but not that expensive yet. no mrt yet for most stretch of east coast). - i ended up looking seriously at East Coast in the end.

the next "potential" area will be jurong lake district. is unpolish but taking shape

[kingkong1984]

Still chewing on this.
Anybody here with accountancy or economics background?
What does an accountant say about the profit?
What does an economist say about the profit?
is it profit of 700k or loss 100k?

You did not factor in inflation or the opportunity cost of money.

If we assume inflation rate at 3% per annum, your 200k compounded value would be $361,222.25. If you sold higher, its a profit, lower, no, at is net position.

A 1 million property sold for $900k after 20 years, I will grab. Where to find? It's a loser for sure.

[devilplate]

the next "potential" area will be jurong lake district. is unpolish but taking shape

but i see it more transforming into another changi biz park/jurong biz park leh:beats-me-man:

u see simei/tanah merah condos near changi biz park....to me not much effect leh....more indian tenants nia.....10 viewing, 6-8 is indian family....

[Wild Falcon]

Orchard Road only "cool" to those teenagers or adults with no cars. Most drivers avoid such places and prefer areas with ample parking and far from the annoying teenage beng crowd to chill-out. Next time u ask around for "chill-out" places and the no-car crowd will always suggest places "near MRT station" like Orchard Ion and those with cars will prefer the Dempsey and ulu places like Riders Cafe to chill out. Even the restaurants or foodcourts at Ion/313 is like sub-standard and mainly catering to the less discerning crowd.


There are simply too many choices now! There is no way u can get tired of any 1 place, cos u got no chance to!! too little time, too many new shopping centers to visit. I love places like VIVO city, Dempsy hill, orchard emerald drinking belt, RWS and maybe in time to come MBS.

[devilplate]

Orchard Road only "cool" to those teenagers or adults with no cars. Most drivers avoid such places and prefer areas with ample parking and far from the annoying teenage beng crowd to chill-out. Next time u ask around for "chill-out" places and the no-car crowd will always suggest places "near MRT station" like Orchard Ion and those with cars will prefer the Dempsey and ulu places like Riders Cafe to chill out. Even the restaurants or foodcourts at Ion/313 is like sub-standard and mainly catering to the less discerning crowd.

just recently i discovered dempsey...tks to the forum....hehe....can see aston, porsche there too:D but hor, parking can also be a problem there during wkend nites:mad:

[ay123]

but i see it more transforming into another changi biz park/jurong biz park leh:beats-me-man:

u see simei/tanah merah condos near changi biz park....to me not much effect leh....more indian tenants nia.....10 viewing, 6-8 is indian family....

is more of biz plus entertainment leh.....for investment purpose (unless short term flipper) i personally think can buy into the jurong lake district idea. this should be different for changi biz park which is solely for biz purpose.

[devilplate]

is more of biz plus entertainment leh.....for investment purpose (unless short term flipper) i personally think can buy into the jurong lake district idea. this should be different for changi biz park which is solely for biz purpose.

but nid to buy FH to hold on for the transformation wor...or shd be flipping based on stories liao

[hopeful]

but nid to buy FH to hold on for the transformation wor...or shd be flipping based on stories liao

is there FH in OCR?
if there is and it is rare, is the premium for FH OCR bigger % against LH OCR than premium for FH CCR against LH CCR?
since FH is rarer in OCR than CCR?

[devilplate]

is there FH in OCR?
if there is and it is rare, is the premium for FH OCR bigger % against LH OCR than premium for FH CCR against LH CCR?
since FH is rarer in OCR than CCR?

D5 mainly FH....

[kane]

Was at ion orchard the other weekend. Holding my 3 year old's hand and because of her height, there were these obnoxious ladies with their big handbags slung by their side who hardly noticed my young one and one handbag even struck my kid's forehead. And not even a word of apology! That is one place I hate to go, and if it weren't for the orchard station, I won't have even gone near there.

The crowd just isn't suitable for young kids.

[hyenergix]

Was at ion orchard the other weekend. Holding my 3 year old's hand and because of her height, there were these obnoxious ladies with their big handbags slung by their side who hardly noticed my young one and one handbag even struck my kid's forehead. And not even a word of apology! That is one place I hate to go, and if it weren't for the orchard station, I won't have even gone near there.

The crowd just isn't suitable for young kids.

Won't recommend to go to Orchard Road for shopping unless for buying luxury goods. Now suburbs malls can offer much at lower cost than Orchard Road malls minus the crowd. I haven't gone to Orchard Road to shop for more than 4 years.

[devilplate]

Won't recommend to go to Orchard Road for shopping unless for buying luxury goods. Now suburbs malls can offer much at lower cost than Orchard Road malls minus the crowd. I haven't gone to Orchard Road to shop for more than 4 years.

same here....totally nvr tink of driving into orchard....only visit once when ION is open....lol....i feel like a foreigner there!!! better stay at my heartland malls b4 i get 'lost' in SG:scared-3:

[teddybear]

Wah, your type of incident always happen when I go to heartland malls lei. Worst still, just there for an hour already meet so many rude and uncivilised people. Way worse experience. Thought heartland malls should be more spacious since the place cheap to build but nowsadays why so cramped and people so uncivilised? :doh:


Was at ion orchard the other weekend. Holding my 3 year old's hand and because of her height, there were these obnoxious ladies with their big handbags slung by their side who hardly noticed my young one and one handbag even struck my kid's forehead. And not even a word of apology! That is one place I hate to go, and if it weren't for the orchard station, I won't have even gone near there.

The crowd just isn't suitable for young kids.

[devilplate]

Wah, your type of incident always happen when I go to heartland malls lei. Worst still, just there for an hour already meet so many rude and uncivilised people. Way worse experience. Thought heartland malls should be more spacious since the place cheap to build but nowsadays why so cramped and people so uncivilised? :doh:

but u aso cannot stop uncilvilised ppl to shop at PRIME PRIME orchard road rite....hehe:p

[teddybear]

I didn't say I can stop uncivilised people from shopping in prime orchard? But what is the difference if you quote something that cannot be peculiar to a certain place? 1 thing for sure - those places with lots of foreign unskilled/semi-skilled workers not so civilized lah (and they tend to live around and hang around shopping in heartland malls than orchard expensive malls). :D


but u aso cannot stop uncilvilised ppl to shop at PRIME PRIME orchard road rite....hehe:p

[proud owner]

I didn't say I can stop uncivilised people from shopping in prime orchard? But what is the difference if you quote something that cannot be peculiar to a certain place? 1 thing for sure - those places with lots of foreign unskilled/semi-skilled workers not so civilized lah (and they tend to live around and hang around shopping in heartland malls than orchard expensive malls). :D


uncivilised people everywhere lah .. just some wear nicer clothes (CCR) ..some dress like Falungkung lookalike outfit (non CCR)

only our infra structures are improving ...other aspects are moving backward

[gfoo]

plebians are plebians, no matter where they are - heartland malls or posh shopping centers.

Amongst all the malls in orchard, Ion has the highest density of plebians in the basements as not only is that area the hub for the rest of singapore coming into orchard via public transport, but the makeup of the shops there too.

[rattydrama]

switzerland of the east ?

in what sense ?

no NS ?
high salary?
high tax?
short work hr?
make watch?
ski resorts ?
send a few NS men to guard Vatican ?

what abt switzerland we trying to emulate?

Switzerland of the east ~

NS men playing computer game
Tonnes of cash rich people buying property and not staying.
Super high property price
High salary for the civil servants
People without full time job yet able to self generate income.
Flexible work hours
Ang Bao of 20k from Ah Gong to citizen every year. J
More casinos

Its all about $ and $ to continue rolling in. Lets hope.

[sh]

the next "potential" area will be jurong lake district. is unpolish but taking shape

As early has 2001. URA has identified 3 regional centres in 2001 Concept Plan. Tampines, Woodlands and Jurong East (reincarnated as Jurong Lake District). Of the 3, Tampines seems to be the most developed. Yet Tampines is still tampines... not orchard road. Prices are no where near CCR.

What is so different about Jurong Lake that makes it different from Tampines? :beats-me-man:

Maybe, should start looking at Woodlands... the most unsung of the 3 regional centres....:tongue3:

[sh]

just recently i discovered dempsey...tks to the forum....hehe....can see aston, porsche there too:D but hor, parking can also be a problem there during wkend nites:mad:

Parking is much easier at Dempsey, compared to holland V.:doh: Have have gone to Holland V since Dempsey.

[kane]

house near dempsy not bad, can go to the pubs and listen to live singers and chill. that is one part of town i don't mind being near.

[rattydrama]

nid to calculate the annual pct returns.....see whether above inflation anot....to me anything beats inflation is a winner:D
I tot the rent $ already taken the inflation into consideration. Will you charge $3k pm rental for whole of 20 years?

[rattydrama]

As early has 2001. URA has identified 3 regional centres in 2001 Concept Plan. Tampines, Woodlands and Jurong East (reincarnated as Jurong Lake District). Of the 3, Tampines seems to be the most developed. Yet Tampines is still tampines... not orchard road. Prices are no where near CCR.

What is so different about Jurong Lake that makes it different from Tampines? :beats-me-man:

Maybe, should start looking at Woodlands... the most unsung of the 3 regional centres....:tongue3:


Thanks for supporting Woodlands. I am Woodlands supporter.:spliff:

[rattydrama]

Parking is much easier at Dempsey, compared to holland V.:doh: Have have gone to Holland V since Dempsey.

Dampsey Japanese Restaurant not bad - forgot the name. Just spent $180 this new year (2pax). Jumbo also good.

[Regulators]

don't bother going to Dome for spaghetti. I got the waitress to bring the marinara twice last week as the spaghetti was only 3/4 cooked. In the end my wife and i just left the restaurant after salad, really lousy chef that can't even cook spaghetti.


Dampsey Japanese Restaurant not bad - forgot the name. Just spent $180 this new year (2pax). Jumbo also good.

[kane]

Wah, your type of incident always happen when I go to heartland malls lei. Worst still, just there for an hour already meet so many rude and uncivilised people. Way worse experience. Thought heartland malls should be more spacious since the place cheap to build but nowsadays why so cramped and people so uncivilised? :doh:

It's an ion orchard thing. I don't get this in Centrepoint raffles city or my neighborhood mall.

[DaytonaSS]

Parking is much easier at Dempsey, compared to holland V.:doh: Have have gone to Holland V since Dempsey.

Easier n free! :)

[DaytonaSS]

Dampsey Japanese Restaurant not bad - forgot the name. Just spent $180 this new year (2pax). Jumbo also good.

If u like Korean, u must try the Korean restaurant there!

[DaytonaSS]

house near dempsy not bad, can go to the pubs and listen to live singers and chill. that is one part of town i don't mind being near.

Share my 2cents worth, I think farrer stretch got great upside potential. 3 new developments on the stretch, definately will bring up the price ard the area. d,leedon launching, Leedon height coming soon, Tulip garden ongoing en boc, serene house en bloc successful. Est FH new launch 2.1k Psf. MRT nearby, good schools, plus near dempsy n botanic garden.

[kingkong1984]

Ideal location.
Price is RCR range max to pay

[hopeful]

It's an ion orchard thing. I don't get this in Centrepoint raffles city or my neighborhood mall.

Don't stereotype or over-generalise.
Just because a Singaporean have paedophilia doesn't mean all Singaporeans possess paedophilia material in their computer.

[kane]

I'm talking about rude people not paedophilia. And I was comparing malls on the same strip, but the crowd is just different.

[hopeful]

Does anybody here play Monopoly, Singapore edition?
What is the most expensive property in the Singapore edition?

can somebody help? Most expensive property in Singapore edition?

Most of people here, if not all, are property owners/investors/speculators?
How do you get your kids interested in property investment?

[proud owner]

I'm talking about rude people not paedophilia. And I was comparing malls on the same strip, but the crowd is just different.

this kind of people exists everywhere

on my way back to spore at JFK airport .. when they announced that business class + PPS members can check in ... my wife and I were lining up ... when it came to my turn..a chinese woman ( non PRC) tried to squeezed in front of me from the side, and flashed her PPS card

my wife pulled me back and commented :

Let her go first, shes in such a hurry

that woman turned around and raised her voice at my wife saying :

You dont have to be so sarcastic ,

i had to intervenened and asked her :
why cant you line up ? why do you have to come in front of me ..
she denied
but the fact is ..shes more front than my wife, who was standing behind me

we didnt want to make a scene ..and i asked her to go first

only then she moved back ..

[kane]

I wonder why people have to cut the queue when the seat has already been allocated. I'm sure these people exist in suburban malls as well. It's just my observation that they are probably in higher concentration in the basement levels of ion orchard.

Ok maybe i've digressed too far. Let's get back to property discussion.

[proud owner]

I wonder why people have to cut the queue when the seat has already been allocated. I'm sure these people exist in suburban malls as well. It's just my observation that they are probably in higher concentration in the basement levels of ion orchard.

Ok maybe i've digressed too far. Let's get back to property discussion.


its a show off thingy

we were on business class.. BUT shes PPS member

then again she could have been on coash class ...but still able to board first with her PPS card ..

some people just want to show off that they are BETTER off ..

[hopeful]

I wonder why people have to cut the queue when the seat has already been allocated. I'm sure these people exist in suburban malls as well. It's just my observation that they are probably in higher concentration in the basement levels of ion orchard.

Ok maybe i've digressed too far. Let's get back to property discussion.

Seat has already been allocated. But cabin space is limited. First come first serve.

[devilplate]

its a show off thingy

we were on business class.. BUT shes PPS member

then again she could have been on coash class ...but still able to board first with her PPS card ..

some people just want to show off that they are BETTER off ..

PPS stand for wat ar? hehe...priority smthing?

i travel by tiger nowadays for short trips leh....lol

[teddybear]

Yah basement levels in ION Orchard? Then hang around Level 1 and above lor, the experience will be so much different - more spacious walkways, very few crowd, more spanky and beautifully decorated shops and better services from salesgirls there. :cheers1:
I never like going to the basements (as the saying goes: down to hell, up to heaven) :p


I wonder why people have to cut the queue when the seat has already been allocated. I'm sure these people exist in suburban malls as well. It's just my observation that they are probably in higher concentration in the basement levels of ion orchard.

Ok maybe i've digressed too far. Let's get back to property discussion.

[kane]

its a show off thingy

we were on business class.. BUT shes PPS member

then again she could have been on coash class ...but still able to board first with her PPS card ..

some people just want to show off that they are BETTER off ..

yeah, they want the world to know they have arrived. But fighting for first to get cabin space is just immature. I always board the plane when they flash last call, just before gate closing. And if there's no cabin space, I get private concierge by the aircrew who will deliver me my hand lugagge when the plane lands. Isn't that better that fighting for luggage space?

Teddy, I will try the upper floors next time. But the kids prefer the toy section at centrepoint robinsons.:cheers1:

[hopeful]

yeah, they want the world to know they have arrived. But fighting for first to get cabin space is just immature. I always board the plane when they flash last call, just before gate closing. And if there's no cabin space, I get private concierge by the aircrew who will deliver me my hand lugagge when the plane lands. Isn't that better that fighting for luggage space?

Teddy, I will try the upper floors next time. But the kids prefer the toy section at centrepoint robinsons.:cheers1:

you never fly regional airlines like Vietnam Airlines? All sorts of hand carry are allow in. No more space, stuff at the space behind the last rows. Though my experience was way back in 2002.

[Wild Falcon]

Haha. I like this disdain for basement in Ion. Seriously, some of you here really look down on others yah? No need to be so conscious of class and boundaries lah. Honestly, I never thought of it in this way - go Ion shopping also can go different levels right? Anyway, I don't see the need to go there. There are nice civilised poor people just like there are uncivilised rich folks on the upper levels of Ion.


I wonder why people have to cut the queue when the seat has already been allocated. I'm sure these people exist in suburban malls as well. It's just my observation that they are probably in higher concentration in the basement levels of ion orchard.

Ok maybe i've digressed too far. Let's get back to property discussion.

[Wild Falcon]

At least she is PPS right? The worst I've seen are ang mohs - neither PPS nor business or first class and still ngear ngear cut the PPS/business class queue! I think they assume that they're of a different "class" lor by virtue of the skin colour and maybe their nice address. These are WORSE.


this kind of people exists everywhere

on my way back to spore at JFK airport .. when they announced that business class + PPS members can check in ... my wife and I were lining up ... when it came to my turn..a chinese woman ( non PRC) tried to squeezed in front of me from the side, and flashed her PPS card

my wife pulled me back and commented :

Let her go first, shes in such a hurry

that woman turned around and raised her voice at my wife saying :

You dont have to be so sarcastic ,

i had to intervenened and asked her :
why cant you line up ? why do you have to come in front of me ..
she denied
but the fact is ..shes more front than my wife, who was standing behind me

we didnt want to make a scene ..and i asked her to go first

only then she moved back ..

[amk]

PPS stand for wat ar? hehe...priority smthing?


http://www.singaporeair.com/saa/en_UK/content/krisflyer/aboutpps/index.jsp

[taggy]

From iTODAY:Revisiting housing supply
Ku Swee Yong | Jan 7, 2011 6:00 AM
Based on URA and HDB projections, there could be a deluge of homes in 2013 and 2014
It was a week before last Christmas when we celebrated the Housing and Development Board's (HDB) completion of 1 million flats.
This is an awesome achievement. With 1 million flats averaging about 1,000 sq ft each, the HDB has within 50 years completed and handed over a billion sq ft of residential space. A billion sq ft. One, followed by nine zeros. That is more square footage than the above-ground portion of the Great Wall of China, which spans 6,500km.
Now, the actual number of HDB flats that exist today is just below 900,000. According to the HDB's annual report, as of March 31, 2010, there were 890,212 flats under management. More than 100,000 flats have been demolished since the '70s, many of them rental flats. Older estates, such as Brickworks and Queenstown, have been upgraded.
Over the years, small individual estates have also been amalgamated into towns such as Bukit Merah Town, Clementi New Town, etc, under various estates renewal programmes, such as Selective En bloc Redevelopment Scheme (Sers).
The completion of an average of 20,000 flats per year in the HDB's 50-year history was in tandem with the growth of Singapore's population.
In the last 15 years, from 1995 to 2010, population growth (Singaporean citizens and permanent residents) averaged 50,000 per year, accommodated by the growth of public (additional 13,950 flats a year) and private housing (8,593 units a year). This is an average of one apartment for every two to three Singapore citizens and PRs. If we included non-residents (Work Permit and Employment Pass holders, for example), then this is an average of one new HDB or private home for every four new people added to the "headcount" in Singapore.
Table 1 shows the actual supply of physical units versus population growth. The 15-year data looks balanced.
However, within the 15 years, there were several tumultuous periods. Early on, a long queue of up to five years for HDB flats formed due to a perception of supply shortage and rising prices. Executive Condominiums were introduced.
The massive construction boom around 1995, with fuel added by en-bloc deals, led to a massive increase of 44,000 residential units per year in the period spanning 1998 to 2000. This is net additional physical supply; that is, demolitions from en-bloc deals have reduced the total count.

THE SCOURGE OF SARS
The economy dipped in 2001 after the dotcom crash, which was followed by 911, Gulf War II, the Bali bomb blast, and then Sars. The blip during the Sars crisis was the worst: A recession with a population exodus of 61,000 in 2003, during which there was an accumulated excess of residential units.
By March 2004, HDB announced it would stop building five-room flats because it had 10,000 units that were waiting to be taken up. At that time, three-bedroom private apartments could easily be had at $500,000 and there was little demand from a population that shrank by 61,000.
The over-supply, apparent since 2001, brought on a revamp of the HDB and the introduction of the Build-To-Order (BTO) scheme. HDB flats will be constructed only when there are enough buyers, allowing the board to adjust supply based on demand from applicants.
In 2002, the registration for flats system was suspended and till today, the BTO scheme remains the main mode of HDB's sales. The Design, Build and Sell Scheme (DBSS) was introduced in 2005 for private sector developers to participate in public housing projects. This scheme contributes about 10 per cent of total new HDB supply.
The period of 2004 to 2005 was one of slow growth as there was excess supply which had to be absorbed by new demand from the population growth before equilibrium could be reached. Government Land Sales slowed down, leading to the next squeeze.

MARKET RECOVERS AMID EN-BLOC FEVER
From 2006 to 2008, real estate prices recovered on a combination of factors, including: (a) rapid population growth on the back of strong jobs creation; (b) rosy economic outlook spurred by the promise of the integrated resorts; (c) developers replenishing freehold land bank through en bloc transactions and (d) small number of project starts in 2003 to 2005 leading to low completion numbers in 2006 to 2008.
Of the above factors, the en bloc phenomenon created the biggest squeeze because it (a) demolished physical housing units to make way for redevelopment, reducing total stock; (b) put millions of dollars of windfall into the hands of the en bloc sellers, amplifying purchasing power, and (c) en bloc sellers had to buy another property for their own stay at a time when net new supply was already low.
The average growth of population in the last five years - from 2006 to last year - was 162,000 per year. The demand for housing was way higher than the net supply growth of private residential at 5,780 units per year and the additional supply of 2,129 HDB flats per year, partly due to Sers rejuvenation of older estates. The timing could not have been better.
If we narrowed our analysis down to the numbers for 2006 to 2008, the shortage of space is even more pronounced. Vacancies dropped to a low of around 4 per cent as the average annual increase of 4,077 units of private residential stock (TOP completions minus en bloc demolitions) and 1,858 units of HDB stock were hardly enough for the influx of population at 191,200 a year! Assuming the new population agreed to squeeze into residential units 10 people at a time, we would need a supply of 19,100 units each year in 2006 to 2008. But the additional stock count was only 5,935. So naturally, rentals and capital values spiked.

SUPPLY OUTLOOK
We need to look at the planning for physical supply and not merely the real estate market based on launches and pre-sales. Some schools of thought favour the idea that, in land-scarce Singapore, property investors merely care about capital gains, not the steady rental income stream. For me, I stress the importance of long-term returns from real estate and therefore, I keep a close eye on physical supply and asset utilisation.
A property has real value only when it is well-used. Most hard, capital-intensive assets are like that: Ships, aeroplanes, machinery, satellites, ports, highways, and so on. If you leaned towards feng shui, you would also believe that the higher the human traffic and goods flow (especially for industrial, retail and commercial properties), the better the property.
An over-supply of completed residential properties, with insufficient end-users and poor utilisation, would naturally lead to price weakness.
Conversely, insufficient supply or too-rapid a population or demand growth will lead to sky-rocketing prices - similar to the situation in 2007. This would not go down well with our central planners. Despite being a top-notch economy, Singapore does not like to price itself out of the market. So, we can expect more supply to quench the fire of rising prices.
Since the middle of 2009, public housing demand has been robust and prices have moved up sharply. From Table 2, we see that HDB launches of BTOs were ramped up significantly last year.
According to the HDB: "The ramp-up of flat supply is part of a series of additional measures to reinforce the Government's commitment to provide affordable and adequate public housing supply for first-timer households." If demand remains strong, the HDB may launch up to 22,000 BTO flats and release land for 7,000 DBSS units this year. That's a potential 29,000 HDB units. That's huge.
However, the numbers do not indicate when the physical supply will be completed. The HDB supplies new flats based on various demand factors, such as new households formed from marriages, number of resale transactions, etc. To satisfy the strong demand and in order to shorten the waiting time for first-time buyers, Mr Mah Bow Tan, the Minister for National Development, has announced that the HDB will endeavour to complete construction within two-and-a-half years, shorter than the previous average of three years, for all BTOs starting from September last year.
Based on the above information, public housing supply is estimated to be as shown in Table 3:
If we net out the number of HDB units that may be demolished for estate renewal, the supply looks comfortable, especially since most of the BTO flats have found owners before construction began.
However, if we look at the total supply of residential units (both HDB and private) as shown in Table 4, the numbers become somewhat scary.
If you recall from Table 1 above, the 15-year average annual supply is about 22,000 units of HDB and private housing. The recent record high Government Land Sales programme and the ramp up of HDB supply may lead to a supply of over 30,000 units in 2013 and 43,000 units in 2014.
The last time so many residential units were completed was during the period of 1998 to 2000, when an average 44,000 units were completed per year. That was a supply level that was challenging to absorb as new family formations through marriages tracked at around 25,000 per year and thepopulation increased at 70,000 per year. And not all newly-weds purchase homes or move out of their parents' nests, while new population may come in the form of students or contract workers who occupy dormitories rather than residential units.
That period of over-supply led to a long period of indigestion from 2002 to 2005, when prices stagnated on the back of an economy hit by Sars and external turbulence. Vacancies of private residential units hovered above 8 per cent for most of 2002 to 2005, much higher than the 5 to 6 per cent of 2009-2010.

WHAT MIGHT BE THE LEVERS TO PULL?
Should the Urban Redevelopment Authority's projections of residential completions be accurate and HDB supply remains high, we must brace ourselves for a deluge in 2013 and 2014. We are now in 2011, so that gives us over a year to prepare. There are, however, a few ways that may mitigate the over-supply threat:
Speeding up estate renewal programmes
By 2015, there will be more than 200,000 flats that will be over 30 years old. Old flats could be torn down sooner. Current tenants will be given notice to move out into other HDB flats. However, HDB's pace of renewal programmes is not entirely clear to market watchers, so I would not be able to take a stab here.

Slowing down construction
The HDB can choose to slow down the supply of new flats. In the case of BTOs, the process of applications, queueing, balloting, selection, etc, and then contracting the construction companies to build are within the control of HDB. If physical supply is high and vacancies increase, the completion of construction could be delayed for the market to take up some slack.
Embracing more foreigners
The demand side of the equation could be jacked up by welcoming more foreigners to our shores. This is especially so if the economic growth in the next five years can hold up at 5 per cent or higher, ensuring that jobs growth will be robust. If executed well, an increase in housing demand produces the best outcome for the whole market.
It remains to be seen if the large supply can be supported by demand. It is critical for stakeholders to make informed decisions, thinking through a comprehensive set of real estate data such as housing demolitions, population growth policies, public and private housing TOPs, etc, to the extent that such information is available.

The writer is the founder of real estate agency International Property Advisor (IPA), which provides services to high-net-worth individuals.

--------------------

very long article... anyone comment pls...

[kane]

A fence sitting article. After reading all that I can't tell whether he's bull, bear or neutral! It has no value other giving you more details stats than what most forummers here already know.

[hyenergix]

Going by the speed of construction, the deluge could come 1-2 years earlier around 2012. The proposed solutions may not be effective:

Increasing immigration number is very sensitive now due to lack of transport, health care etc infrastructure. Adequate housing supply is only part of the picture. Now it is also very politically sensitive.
Speeding up estate renewal process via SERS is expensive and challenging due to limited land for new HDB estates.
BTOs cannot be slowed down due to real demand by lower-medium income people who actually needs the house now.In another word, only slowdown in GLS can mitigate but not solve the problem of large supply in the next few years.

[avo7007]

The whole article is based on the historical data of 2002-2005 period. But the period between 2006-NOW have seen explosive population growth and demograhic changes. And not to mention the rapid rise of Asia economies and prolong environment of very low interest rate. There are more dynamics at play now than the period between 2002 and 2005.....................

[Laguna]

He was a super bull in the 2007-8 before the crisis, appeared in the papers/talk so often

[devilplate]

Going by the speed of construction, the deluge could come 1-2 years earlier around 2012. The proposed solutions may not be effective:

Increasing immigration number is very sensitive now due to lack of transport, health care etc infrastructure. Adequate housing supply is only part of the picture. Now it is also very politically sensitive.
Speeding up estate renewal process via SERS is expensive and challenging due to limited land for new HDB estates.
BTOs cannot be slowed down due to real demand by lower-medium income people who actually needs the house now.In another word, only slowdown in GLS can mitigate but not solve the problem of large supply in the next few years.

u r waiting to buy?

[penguin]

Spoke to a few agents and all mentioned rental mkt is moving up. Agents also mentioned there are many pple, including indos wanting to rent first (River Valley area somemore), and they intend to buy when there is a price correction. Does this show there is no lack of money ard; afforability is not an issue; and everyone is playing the waiting game? What will the outcome be in 2012-2013? Any comments?

[devilplate]

Spoke to a few agents and all mentioned rental mkt is moving up. Agents also mentioned there are many pple, including indos wanting to rent first (River Valley area somemore), and they intend to buy when there is a price correction. Does this show there is no lack of money ard; afforability is not an issue; and everyone is playing the waiting game? What will the outcome be in 2012-2013? Any comments?

first of all, ur sources totally unreliable oredi....agts words/stories u can believe meh?

[penguin]

first of all, ur sources totally unreliable oredi....agts words/stories u can believe meh?

Yes I know agents' words cannot totally believe. But one thing for sure, rental is indeed moving up. That I am sure, because my RCR unit used to fetch 2.8K just a yr ago, now it's 3.2K. Surrounding devt's rental also increased.

I actually do think there will be a price correction, but not a crash. Could it be just a slight one, before prices start to rise steadily again?

[hopeful]

The whole article is based on the historical data of 2002-2005 period. But the period between 2006-NOW have seen explosive population growth and demograhic changes. And not to mention the rapid rise of Asia economies and prolong environment of very low interest rate. There are more dynamics at play now than the period between 2002 and 2005.....................

Forgot the New Economy already? IT is the game changer. No more business cycles. Dow will hit 40.000, blah blah blah.

So now more dynamics, more game changer? Very good if many people think like you. Humans have short memories. That's why have boom or bust. If no boom and bust, how to make money?

[devilplate]

Yes I know agents' words cannot totally believe. But one thing for sure, rental is indeed moving up. That I am sure, because my RCR unit used to fetch 2.8K just a yr ago, now it's 3.2K. Surrounding devt's rental also increased.

I actually do think there will be a price correction, but not a crash. Could it be just a slight one, before prices start to rise steadily again?

price correction oredi over after aug cooling measures....spotted some slightly below valuation transaction for some condos...

i am still waiting for BIG bubble leh.....so far...only bubbles in new launches....resale like :sleep: :sleep: :sleep:

rental definitely up compared to last yr lows lor...dun say RCR....my OCR also up from 2k to 2.5k and found tenant within 2wks

[penguin]

price correction oredi over after aug cooling measures....spotted some slightly below valuation transaction for some condos...

i am still waiting for BIG bubble leh.....so far...only bubbles in new launches....resale like :sleep: :sleep: :sleep:


Yeah I agree you can still find some good buys in the resale mkt, but not the new devts.

However, Im thinking if it's true that Singaporean's wealth is bigger now than before, so much so that majority can easily afford to pay, say 1400psf or higher in D15. If there is really a crash, won't they have holding power to hold on till the next peak again? What makes pple think they will sell at a huge loss?

If there is a crash, how low do you think D15 (marine parade area) will drop to?

[hopeful]

Triple whammy in 1997-1998
1) Interest up and up.
2) People lose job.
3) Property value goes down.

Hopefully it happens again in next recession after I clear my stock.
Hopefully recession last like 2 years, because most experts advises investors to have only 1 year standby to cover expenses.

[hyenergix]

u r waiting to buy?

I already bought one last year to be nearer to work at a reasonable price. I can afford another one but not keen at these prices now. So currently just looking around showrooms to enjoy the interior deco and gauge market sentiment. Hoping to buy a resort-style small unit near a beach if the price is right.

[devilplate]

I already bought one last year to be nearer to work at a reasonable price. I can afford another one but not keen at these prices now. So currently just looking around showrooms to enjoy the interior deco and gauge market sentiment. Hoping to buy a resort-style small unit near a beach if the price is right.

is there such unit? small unit near beach? perhaps near pasir ris beach ?