View Full Version : Is there Potential Oversupply in 2013 to 2014
2011 - 2012= 8000+ units
2013-2014= 17000+ units
Will there be over supply?
If there is indeed an over supply then prices will come down, or else it will not... Can all forummers share...
devilplate
18-04-11, 17:36
2011 - 2012= 8000+ units
2013-2014= 17000+ units
Will there be over supply?
If there is indeed an over supply then prices will come down, or else it will not... Can all forummers share...
i cant remember any px correction due to oversupply......
Wild Falcon
18-04-11, 17:37
Because the oversupply hasn't come yet - and developers keep delaying their projects. I believe from 2012 onwards. There are already projects that are going to TOP quite empty...
17k supply will it make MBT 22K HDB supply in a year look impressive?
2011 - 2012= 8000+ units
2013-2014= 17000+ units
Will there be over supply?
If there is indeed an over supply then prices will come down, or else it will not... Can all forummers share...
Prices will not come down if there is oversupply as developers have holding power and interest rates are low. Take The Interlace as an example. Since launch with 900 units, only 653 units have been sold (72.5%, which is no good by today's standard which is overall 90% of units launched have been sold). This is a mini-oversupply situation in the project as there appears to be no takers. But, the developer is not lowering prices anytime soon. As of Mar 11, the total units launched but unsold stands at about 5,000. Certainly a bit of oversupply situation. But, you do not see the developers sweating and lowering prices.
Allthepies
18-04-11, 19:41
with 6.5 million populations, what is 10 or 20k supply, definitely not enuff, need around 1-2million additional supply to house 6.5million.. :D
Interlace is not a gd example. 70% is very good. The best stacks are *really* not launched yet. They are waiting for the structure to take shape 1st and sell at a higher price.
I am predicting 50 to 70k increase in sin population a year till we reach 6.5m... Based on 60k a year we will take at least 15 years to reach the target so I think that is conservative enough... Plus with all the new development at paya lebar, one north, juromg lake district, marina bay area, I am sure we need more people to fill these buildings.... I read a report that there are currently over 40k job vacancies in Singapore and expected to increase with the economy growing....
So I think even at 17k completed projects not too many right? I don't understand why URA and MND keep saying that there is a huge pipelines...
The point is price correction downward usually does not come about due to oversupply. Should there be that 1 or 2 developers who cannot hold their properties and so lower their prices, there are another 10 developers with holding power so prices are unlikely to move downward. Duing the 2005/6 HDB oversupply, prices stood firm in the private sector. Only HDB prices dropped a little but after that shot up very quickly too... :tsk-tsk:
Then why is MND and URA and other analyst keep warning about oversupply when it TOP? They are afraid that there will be empty units?
I am predicting 50 to 70k increase in sin population a year till we reach 6.5m... Based on 60k a year we will take at least 15 years to reach the target so I think that is conservative enough... Plus with all the new development at paya lebar, one north, juromg lake district, marina bay area, I am sure we need more people to fill these buildings.... I read a report that there are currently over 40k job vacancies in Singapore and expected to increase with the economy growing....
So I think even at 17k completed projects not too many right? I don't understand why URA and MND keep saying that there is a huge pipelines...
At 60K annual increase to the population, how many are going to buy or rent whole unit??? Consider say 20k are foreigners coming here to study so probably will rent single room or stay in hostel, that leaves us with 40k who'll rent or buy whole unit. Given this 40k, some are foreigners who will share resources to buy or rent, so only about 30k units are required each year. At 22k HDB supply plus 8k private supply will just about be enough for 2013. If at 17k private supply, it'll be trouble... :scared-1:
phantom_opera
18-04-11, 20:46
All these analysts are not good economists. When the workers are able to get higher wages ... that is when high inflation become self-sustaining. This is exactly the argument in the UK/US that imported inflation will not last there due to high unemployment. But it is very different situation in Asia.
So are Singaporeans getting significantly higher pay last few months, answer is a BIG YES.
When inflation expectation becomes high, it takes very high oversupply situation to moderate it (not even crashing it).
At 60K annual increase to the population, how many are going to buy or rent whole unit??? Consider say 20k are foreigners coming here to study so probably will rent single room or stay in hostel, that leaves us with 40k who'll rent or buy whole unit. Given this 40k, some are foreigners who will share resources to buy or rent, so only about 30k units are required each year. At 22k HDB supply plus 8k private supply will just about be enough for 2013. If at 17k private supply, it'll be trouble... :scared-1:
Sorry, there is a loop hole in the interpretation. 22k BOT\DBSS is 3yrs + 5 yrs MOP. the supply only hits in 8 years time, 2019. For now only left with 17k minus enbloc.
At 60K annual increase to the population, how many are going to buy or rent whole unit??? Consider say 20k are foreigners coming here to study so probably will rent single room or stay in hostel, that leaves us with 40k who'll rent or buy whole unit. Given this 40k, some are foreigners who will share resources to buy or rent, so only about 30k units are required each year. At 22k HDB supply plus 8k private supply will just about be enough for 2013. If at 17k private supply, it'll be trouble... :scared-1:
The increase in population have to come from foreigners... As the first time buyers are already calculated in current population... Can't possibly appear out of no where unless they are Singaporean already here...
The supply overhang will provide the opportunity for the market to consolidate like 1998-2003. I prefer that. At least you don't end up chasing prices and shadows.
Then why is MND and URA and other analyst keep warning about oversupply when it TOP? They are afraid that there will be empty units?
Noticed they say oversupply,but never mention price will come down? It is left to our own deduction. Or too many factors at play here.
devilplate
19-04-11, 00:21
in 2007, analyst aso keep mentioning oversupply in 2010 onwards
pte ppty is sentiment driven....no way to forecast sentiment
as for HDB supply....is by BTO....so how to have oversupply?:rolleyes:
If it's oversupply then sentiments will drop if no one to rent from you... So if really over supply then price will drop.... Anyone here agree with URA that there will be over supply? Btw, good point on the fact that bto cannot have oversupply
devilplate
19-04-11, 00:38
If it's oversupply then sentiments will drop if no one to rent from you... So if really over supply then price will drop.... Anyone here agree with URA that there will be over supply? Btw, good point on the fact that bto cannot have oversupply
now clearly got oversupply in luxury prime homes....so many unsold units from developer!.....but prices din drop! rent for luxury homes r below 3% in general and some even below 2%....sentiment still gd....massive liquidity...owners just hold on tight.....SC global aso holdX3!
bargain hunter
19-04-11, 00:46
oversupply but if interest rates are low, minimal rent or even no rent also buyers can hold on. there is no way of determining how many units need rental to cover and how many can be left vacant.
Noticed they say oversupply,but never mention price will come down? It is left to our own deduction. Or too many factors at play here.
Think you miss out another thing - many unsold units with developers who have holding power is better than many empty cannot rent out units held by the individuals with no holding power. The potential oversupply in mass market properties are very real - many HDB upgraders had bought mass market condos while holding on to their HDBs. It is Ok when time is good and they can rent out 1 of their property while living in the other but wait till next recession and these mass market condo renters, who are mid-to-lower management level will be retrench, many go home, many empty mass market condos with non-renting, then you see whether oversupply in luxury prime homes or oversupply in mass market properties? As I said, there are just too much speculation now in mass market condos! :scared-2:
now clearly got oversupply in luxury prime homes....so many unsold units from developer!.....but prices din drop! rent for luxury homes r below 3% in general and some even below 2%....sentiment still gd....massive liquidity...owners just hold on tight.....SC global aso holdX3!
devilplate
19-04-11, 00:51
oversupply but if interest rates are low, minimal rent or even no rent also buyers can hold on. there is no way of determining how many units need rental to cover and how many can be left vacant.
agree....and aso impossible to determine how many r bot for own stay vs investment for those who bot from developer recently....
devilplate
19-04-11, 00:54
Think you miss out another thing - many unsold units with developers who have holding power is better than many empty cannot rent out units held by the individuals with no holding power. The potential oversupply in mass market properties are very real - many HDB upgraders had bought mass market condos while holding on to their HDBs. It is Ok when time is good and they can rent out 1 of their property while living in the other but wait till next recession and these mass market condo renters, who are mid-to-lower management level will be retrench, many go home, many empty mass market condos with non-renting, then you see whether oversupply in luxury prime homes or oversupply in mass market properties? As I said, there are just too much speculation now in mass market condos! :scared-2:
lots of assumption lor...
i am stating the current situation of luxury prime ppty lor.....OCR currently dun hf oversupply problem NOW as rental still gg strong....future who noes rite....u and I r not GOD lor...:p
With so many mass-market owners owning 2 or more properties, the future is already cast in STONE, it is just a matter of time, I am not god because I cannot predict WHEN and HOW bad but I can already estimate WHAT will happen based on the raw data....... :cheers1:
lots of assumption lor...
i am stating the current situation of luxury prime ppty lor.....OCR currently dun hf oversupply problem NOW as rental still gg strong....future who noes rite....u and I r not GOD lor...:p
kingkong1984
19-04-11, 06:15
With so many mass-market owners owning 2 or more properties, the future is already cast in STONE, it is just a matter of time, I am not god because I cannot predict WHEN and HOW bad but I can already estimate WHAT will happen based on the raw data....... :cheers1:
U just need more water to fill in. Can never estimate that.
The increase in population have to come from foreigners... As the first time buyers are already calculated in current population... Can't possibly appear out of no where unless they are Singaporean already here...
The 6.5million population target includes both Singapreans and foreigners. Therefore 60k annual increment includes both Singapreans and foreigners. :D . So if exclude Singaporeans, then it'll just be 30k annual increment coz Singapore's annual birth rate is about 30k to 35k. Next year might be more.
With so many mass-market owners owning 2 or more properties, the future is already cast in STONE, it is just a matter of time, I am not god because I cannot predict WHEN and HOW bad but I can already estimate WHAT will happen based on the raw data....... :cheers1:
This is the first time I see you so *bearish* :D but I share the MMs and condos oversupply view. MM rentals are the most vulnerable because many foreign workers may rent 1 room from HDB owners (which is of no issue to HDB) instead of studio or 1 bedder MM.
This is the first time I see you so *bearish* :D but I share the MMs and condos oversupply view. MM rentals are the most vulnerable because many foreign workers may rent 1 room from HDB owners (which is of no issue to HDB) instead of studio or 1 bedder MM.
Agreed... also those in the construction sector will be housed 40 per landed property. Those in domestic help will stay together with their bosses. MM are mainly for singles expats and overseas students.
Agreed... also those in the construction sector will be housed 40 per landed property. Those in domestic help will stay together with their bosses. MM are mainly for singles expats and overseas students.
They would have to be RICH overseas students.
Remember those MM units would have to be in good location to be easily rentable to either of these groups. Those in CMI locations may have great difficulty getting tenants. Esp if it's a big development where other MM units also vie for the same tenants.
I don't understand why there are still quite a number of forum members who declare confidently that they are not afraid of competition for tenants. This is a very real fact that must be faced. Unless of course servicing the housling loan is not an issue for them.
devilplate
19-04-11, 08:41
Simple analysis:
Let say a MM cost 500k, so 60% ltv means 300k loan...
Stanchart allow u to borrow up to 75yo.... So majority shd b able to take 30yr tenure. Based on worse case 4% int rate: mthly installment= about 1.5k
Currently, condo room rental range from 800-1200.....so during crisis i believe mm rental cud possibly drop to 1-1.2k. So including maint fee etc, owner goto top up 1k every mth.....
make sure u got at least 24k spare cash to ride thru ....
Simple analysis:
Let say a MM cost 500k, so 60% ltv means 300k loan...
Stanchart allow u to borrow up to 75yo.... So majority shd b able to take 30yr tenure. Based on worse case 4% int rate: mthly installment= about 1.5k
Currently, condo room rental range from 800-1200.....so during crisis i believe mm rental cud possibly drop to 1-1.2k. So including maint fee etc, owner goto top up 1k every mth.....
make sure u got at least 24k spare cash to ride thru ....
No point getting a MM with negative rental yield.. If still have to top up with 1k a month, then it's not a wise investment, isn't it? Hmmm... However this can be quite tricky with such low interest rates now... you may be paying only $800 a month for a 300k loan over 30 years tenure. Then in 3 years, interest rate shoots up to 3%, you'll start considering is it time to let go and pay that little bit of SSD... hmm... :(
devilplate
19-04-11, 10:06
No point getting a MM with negative rental yield.. If still have to top up with 1k a month, then it's not a wise investment, isn't it? Hmmm... I always target if rental can completely cover monthly installment then I'll go for it... Am I over cautious in my investment ideals? :D
not sure how u define negative yield.....my own definition of negative yield will be nett rental yield<int rate....
during crisis, any unit regardless of sizes will suffer a drop in rental....
u can only estimate a rental figure during downturn...
mabe u can suggest a project that will still hf positive rental yield(goto be above 4% yield) for a projected downturn rental figure based on current market px?
The 6.5million population target includes both Singapreans and foreigners. Therefore 60k annual increment includes both Singapreans and foreigners. :D . So if exclude Singaporeans, then it'll just be 30k annual increment coz Singapore's annual birth rate is about 30k to 35k. Next year might be more.
Just wondering... The 30-60k of foreigners mentioned include family? I understand most are single that work here but expats normally bring their family along? So the husband/wife/children are included as part of the yearly 30-60k incremental population?
mabe u can suggest a project that will still hf positive rental yield(goto be above 4% yield) for a projected downturn rental figure based on current market px?
Me also want to know.......:D
not sure how u define negative yield.....my own definition of negative yield will be nett rental yield<int rate....
during crisis, any unit regardless of sizes will suffer a drop in rental....
u can only estimate a rental figure during downturn...
mabe u can suggest a project that will still hf positive rental yield(goto be above 4% yield) for a projected downturn rental figure based on current market px?
At current market px, hardly can match 4% int rate.. sigh :doh: But I guess I'm speaking about upfront cash required to hold that property so need not be 4% rental yield. Just need enough rent to cover monthly installment at current 1-2% plus pay conservancy fee...:D
Just wondering... The 30-60k of foreigners mentioned include family? I understand most are single that work here but expats normally bring their family along? So the husband/wife/children are included as part of the yearly 30-60k incremental population?They come as a package so it has to be included, right? Wow!
Since MBT everyday saying large supply y pple r still buying. Y he say wait sales still chong? Y pple here shout crash soon market not dropping?
kingkong1984
19-04-11, 21:18
Market won't crash unless there is thrash.
Units move because many are sitting on paper gains, the more they buy, the more protected their investments are even if it is just a unit.
Market won't crash unless there is thrash.
Units move because many are sitting on paper gains, the more they buy, the more protected their investments are even if it is just a unit.
so people are using property to hedge against inflation? Got many useless USD come here convert into valuable housing? Its it happening?
kingkong1984
20-04-11, 03:12
so people are using property to hedge against inflation? Got many useless USD come here convert into valuable housing? Its it happening?
Sure beats buying toxic investment products or putting cash in bank. Got capital appreciation plus rental n self stay opportunities. If using US dollar to buy, unless paid fully in US dollar upon purchase, the capital gains may be neutralised by currency loss. Plus SSD.
Maybe I should give SSD a nice connotation.
Stop Selling Debt or
Stop Sellers Dreams or
Slow n Steady Decline or
Should Stop Daredevils or
Supply Slowly Decreased or
Save Some Developers. Hmm...
so people are using property to hedge against inflation? Got many useless USD come here convert into valuable housing? Its it happening?
Haha very true and I am one gd example... sitting on tons of useless USD toilet paper, n since I dun play stocks can only LL suck thumb put in property. Even if need to convert bo bian have to bite the nails. I dun see any potential in value of USD in the near future
Will it reach 1 USD = 1 Sin?
devilplate
20-04-11, 09:15
Will it reach 1 USD = 1 Sin?
if it happen, int rate goto remain low for quite some time?
Be contrarian.... It's about time we can start to prepare money to place bets in usd.... Once the economy recovers and interest starts to go up then the currency will go up.... I will put some bets on it of it goes to around 1:1.20 vis a vis sgd
SGD now 1.24. For it to hit 1:1, I shudder to think what's the inflation rate then.
SGD now 1.24. For it to hit 1:1, I shudder to think what's the inflation rate then.Are u referring to Sing D not strengthening but USD continue weakening or what? Inflation will be real low if Sing D strengthening so no need to shudder if u are a Singaporean. Unless u r an American??? Hmmm...
devilplate
20-04-11, 10:48
rumour saying USA wana devalue their currency more rite....they owe trillions of debts leh
rumour saying USA wana devalue their currency more rite....they owe trillions of debts leh
China give the shit, they wanna hit back! China buy tons of their bonds, n dont wanna appreciate their currency, so they depreciate lor. Print more n give it to China
Are u referring to Sing D not strengthening but USD continue weakening or what? Inflation will be real low if Sing D strengthening so no need to shudder if u are a Singaporean. Unless u r an American??? Hmmm...
The cheap USD has driven investors to bid up price of commodities to the point that our SGD appreciation isn't enough cover inflation. So can you imagine the end result inflation when USDSGD is 1:1?
Be contrarian.... It's about time we can start to prepare money to place bets in usd.... Once the economy recovers and interest starts to go up then the currency will go up.... I will put some bets on it of it goes to around 1:1.20 vis a vis sgd
Y put in good $$$$ to exchange for shit dollar. The order of power is already shifting. Isn't it clear which country is rescuing the ang mos? Sucking all he shit bonds they throwing out? Nothing to stop QE 3,4,5,6,7,8,9 if things still don't improve. Buy some yuan maybe better ?
i'm surprised there's been no political backlash given the relentless slide of the USD.
devilplate
21-04-11, 00:02
i'm surprised there's been no political backlash given the relentless slide of the USD.
nothing beats their trillion dollar debt:hell-hath-no-fury:
its a time bomb waiting to explode:scared-3:
http://www.usdebtclock.org/
Obama going for second term on the back of huge debt so now trying to cut cost like crazy... :doh:
rattydrama
21-04-11, 14:12
China give the shit, they wanna hit back! China buy tons of their bonds, n dont wanna appreciate their currency, so they depreciate lor. Print more n give it to China
RMB was about 4.5 to 1SGD a year ago if I remembered correctly and now dropped to 5RMB to 1SGD.
China deliberately "devalue" RMB to align with US?:confused:
rattydrama
21-04-11, 14:13
Will it reach 1 USD = 1 Sin?
Good question? I am thinking of british pounds now, it never return to the good old days!!
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