PDA

View Full Version : Can I still buy at this time of the cycle?



Mary Lee
02-11-12, 21:07
Dear property experts on this forum:

There is one here who has been waiting for the market to crash for the past few years but now has reached a peak. I have accumulated sufficient holding power during the waiting period and now have almost run out of patience. Should I buy now or continue to wait for any possible crash? - I buy for own stay / upgrading. Many thanks for any advice.

Khng8
02-11-12, 21:11
I am no expert but for own stay, if you are upgrading, it means you will also sell high.
So really not much difference, IMHO.

Mary Lee
02-11-12, 21:14
Thanks. I am not selling but renting out.

indomie
02-11-12, 22:09
When to buy or not to buy:
1. Consider your age. If you are early 30s time is on your side, if you are in late 40s you must make your move.
2. Funds availability. If u have enough money of course you must buy to offset inflation effect.
3. 1st house or 2nd and 3rd. For your 1st house u must buy now, for 4rd house you can wait.
4. Family requirement. Consider your growing family needs. If kids are growing up u need bigger space, if kids are moving out need less space.
5. No matter what people are saying about stock surplus, rental will always increase. Rental is not an option, its better to downgrade to smaller unit than paying rental.

Allthepies
02-11-12, 22:16
When u see the unit u like, buy! Even if u manage to wait until the market crash, the unit you want may no longer be in the market. The time to enjoy your house will also be shorten with each passing year. :2cents: :2cents: :2cents:

bakasa2002
02-11-12, 22:26
I been thinking along the line that people are waiting for correction but no one know how deep the correction is going to be and how much the interest rate is going to be by then. More importantly how much prices are going to rise before we see a correction. Not sure if these are valid assumptions. ;)

Laguna
02-11-12, 22:48
I am thinking of starting an advisory service, assisting people to make decision in investment....tailored....

Laguna
02-11-12, 22:51
Dear property experts on this forum:

There is one here who has been waiting for the market to crash for the past few years but now has reached a peak. I have accumulated sufficient holding power during the waiting period and now have almost run out of patience. Should I buy now or continue to wait for any possible crash? - I buy for own stay / upgrading. Many thanks for any advice.

Hi Mary
this is a BIG decision, very big decision.
I would like if possible, do some own thinking first, and share with us, your view..BUY or NOT TO BUY.

Ya, market is at its peak now. But, perhaps, when u look at it, say, one year later, today peak is still low. When u buy, don't compare the price of today to yesterday, but compare it with tomorrow.

U just see, ERP, gone up by 25% over night

radha08
02-11-12, 23:22
When u see the unit u like, buy! Even if u manage to wait until the market crash, the unit you want may no longer be in the market. The time to enjoy your house will also be shorten with each passing year. :2cents: :2cents: :2cents:

totally agree...:cheers4:

radha08
02-11-12, 23:23
I am thinking of starting an advisory service, assisting people to make decision in investment....tailored....

customer #1....Mr YT....:D:D:D:D

Laguna
02-11-12, 23:28
customer #1....Mr YT....:D:D:D:D

I close my shop immediately

PropertyNewbie
02-11-12, 23:28
Supply vs demand.

Yes a lot of supply is coming on stream, but the demand is so freaking huge it's not funny. EVERYBODY I know who is >20 years old to even 50 years old is thinking of buying and investing in property. This type of groupthink is unheard of 10 years ago.

There are many many cash rich folks out there. Even those who lack cash, I have personally witnessed some super garang types who will go to 5 or 6 different banks, borrow unsecured loans at 8-12% INTEREST, just to pay for that downpayment!

And appreciating property prices create a vicious cycle. Many people are taking equity loans against their appreciated properties, and using them to buy more properties! Even though this is not allowed in law, but the money will somehow end up back in the market chasing prices higher and higher.

Funny thing is, properties are like Veblen goods now. The more the price goes up, and the more difficult it is to buy one (via CMs), then the more people are willing to pay higher prices to own one. Nobody wants to miss the bandwagon this time.

For prices to come down, the following conditions must be satisfied

1. Singapore's PAP lose election (<10% probability)
2. Population regresses to 4 million (0% probability with PAP, <10% without)
3. HDB BTO prices drop drastically (0% probability, with or without PAP)
4. Casino licenses are withdrawn (0%)
5. We lose F1 hosting rights (20%)
6. Interest rate go above 5% (<30% in next 3 years)

So there you have it. Not only will prices rise, they will continue unabated until 2016 at least.

But as always, it's your money so you do your own homework :D

kane
02-11-12, 23:45
to the threadstarter, just be very selective of new launches. if you pick the wrong one, your buffer is very little to weather on the downside.

nowadays, the buffer for error on resale also getting much smaller.

Alan Tam
02-11-12, 23:48
Dear property experts on this forum:

There is one here who has been waiting for the market to crash for the past few years but now has reached a peak. I have accumulated sufficient holding power during the waiting period and now have almost run out of patience. Should I buy now or continue to wait for any possible crash? - I buy for own stay / upgrading. Many thanks for any advice.

Many people are hoping that the property market crash, so that they can get a good buy. But when market really crash, will they buy???

They will never buy, as they do not know how low is low during that time, so they will wait and wait...until the market go up again and they will say wait for the market to crash again..finally they never buy and miss all those boats...

With the effectiveness of QE3 now, inflation is inevitable, labour cost went up and so do the land cost. I read that the MRT downtown line cost also went up by 70% from 12.8 billion to 20 billion.

azeoprop
03-11-12, 00:41
Nowadays the only time that price will drop a bit is when a new harsh CM comes out.

e.g. in early 2011, the 4 years SSD and 60% loan for 2nd property came out, FEO offered an unprecedented 5% furniture rebate for their WFI launch.

e.g. in early 2012 when the ABSD came out, many projects gave extra discounts of 3% for the first few weeks. And some projects lowered their launch prices e.g. ripple bay 1 bedder was only 420k around 850psf.

:beats-me-man:

Kanarazu
03-11-12, 01:19
I been thinking along the line that people are waiting for correction but no one know how deep the correction is going to be and how much the interest rate is going to be by then. More importantly how much prices are going to rise before we see a correction. Not sure if these are valid assumptions. ;)

How deep can a correction be? Thinke Lehman's collapse only caused psf price to dip 20%.

whoh757
03-11-12, 02:18
to the threadstarter, just be very selective of new launches. if you pick the wrong one, your buffer is very little to weather on the downside.

nowadays, the buffer for error on resale also getting much smaller.


Go for resale. Look hard for opportunistic buying at 10% below market transacted price. 30% downpayment for additional buffer.

Arcachon
03-11-12, 02:20
Dear property experts on this forum:

There is one here who has been waiting for the market to crash for the past few years but now has reached a peak. I have accumulated sufficient holding power during the waiting period and now have almost run out of patience. Should I buy now or continue to wait for any possible crash? - I buy for own stay / upgrading. Many thanks for any advice.

This is what's in my mind when I buy a 2 Bedroom @ Southbank in June 2006.

I have 100k cash, I have a 5 room HDB with 100k outstanding loan. 2 Bedroom @ Southbank selling for 535k. At that time there is this thing call DPS, pay 5% and the rest TOP, bank in principle approval not required......

My 5 room HDB was selling for 390k and rented out for 1.2k two years ago, so I work out the worst case. TOP property drop and I sell my 5 room HDB and stay in Southbank and pay the rest of the mortgage and so I decided to buy a 2 Bedroom @ Southbank.

Hope this will help you decided.

Secretariat
03-11-12, 05:40
Supply vs demand.

Yes a lot of supply is coming on stream, but the demand is so freaking huge it's not funny. EVERYBODY I know who is >20 years old to even 50 years old is thinking of buying and investing in property. This type of groupthink is unheard of 10 years ago.

There are many many cash rich folks out there. Even those who lack cash, I have personally witnessed some super garang types who will go to 5 or 6 different banks, borrow unsecured loans at 8-12% INTEREST, just to pay for that downpayment!

And appreciating property prices create a vicious cycle. Many people are taking equity loans against their appreciated properties, and using them to buy more properties! Even though this is not allowed in law, but the money will somehow end up back in the market chasing prices higher and higher.

Funny thing is, properties are like Veblen goods now. The more the price goes up, and the more difficult it is to buy one (via CMs), then the more people are willing to pay higher prices to own one. Nobody wants to miss the bandwagon this time.

For prices to come down, the following conditions must be satisfied

1. Singapore's PAP lose election (<10% probability)
2. Population regresses to 4 million (0% probability with PAP, <10% without)
3. HDB BTO prices drop drastically (0% probability, with or without PAP)
4. Casino licenses are withdrawn (0%)
5. We lose F1 hosting rights (20%)
6. Interest rate go above 5% (<30% in next 3 years)

So there you have it. Not only will prices rise, they will continue unabated until 2016 at least.

But as always, it's your money so you do your own homework :D

Thanks for the info.

cnud
03-11-12, 08:23
Never time the market for own stay. The loss in time cannot be replaced by any amount of money. There are also simply too many waiting at the sideline for crash and once some correction comes, they will snap up... unless you really snap the unit before its even listed/launched.

Those that buy now are financially stronger. The CMs are aimed at restricting speculative investors and not aimed at lowering the price.

But do your sums and must have the ability to hold even when it corrects. It's your own zua li (money).

alamak
03-11-12, 08:41
Supply vs demand.

Yes a lot of supply is coming on stream, but the demand is so freaking huge it's not funny. EVERYBODY I know who is >20 years old to even 50 years old is thinking of buying and investing in property. This type of groupthink is unheard of 10 years ago.

There are many many cash rich folks out there. Even those who lack cash, I have personally witnessed some super garang types who will go to 5 or 6 different banks, borrow unsecured loans at 8-12% INTEREST, just to pay for that downpayment!

And appreciating property prices create a vicious cycle. Many people are taking equity loans against their appreciated properties, and using them to buy more properties! Even though this is not allowed in law, but the money will somehow end up back in the market chasing prices higher and higher.

Funny thing is, properties are like Veblen goods now. The more the price goes up, and the more difficult it is to buy one (via CMs), then the more people are willing to pay higher prices to own one. Nobody wants to miss the bandwagon this time.

For prices to come down, the following conditions must be satisfied

1. Singapore's PAP lose election (<10% probability)
2. Population regresses to 4 million (0% probability with PAP, <10% without)
3. HDB BTO prices drop drastically (0% probability, with or without PAP)
4. Casino licenses are withdrawn (0%)
5. We lose F1 hosting rights (20%)
6. Interest rate go above 5% (<30% in next 3 years)

So there you have it. Not only will prices rise, they will continue unabated until 2016 at least.

But as always, it's your money so you do your own homework :D

Wah ! You nick property newbie ... but but can gave such grandiose advices :D

radha08
03-11-12, 08:57
Wah ! You nick property newbie ... but but can gave such grandiose advices :D

he has been reading and learning before he joined the forum..:D

kale
03-11-12, 08:59
Hear all these stories from u sound so scary.... All these risky doings make the bubble bigger and burst ultimately..... Though I do not like CM, but as time goes it make more sense to have these CMs around to stablise the mkt n diminish the bubble then to have the big bubble burst dramatically and hurt lot of people, especially this time round.



Supply vs demand.

Yes a lot of supply is coming on stream, but the demand is so freaking huge it's not funny. EVERYBODY I know who is >20 years old to even 50 years old is thinking of buying and investing in property. This type of groupthink is unheard of 10 years ago.

There are many many cash rich folks out there. Even those who lack cash, I have personally witnessed some super garang types who will go to 5 or 6 different banks, borrow unsecured loans at 8-12% INTEREST, just to pay for that downpayment!

And appreciating property prices create a vicious cycle. Many people are taking equity loans against their appreciated properties, and using them to buy more properties! Even though this is not allowed in law, but the money will somehow end up back in the market chasing prices higher and higher.

Funny thing is, properties are like Veblen goods now. The more the price goes up, and the more difficult it is to buy one (via CMs), then the more people are willing to pay higher prices to own one. Nobody wants to miss the bandwagon this time.

For prices to come down, the following conditions must be satisfied

1. Singapore's PAP lose election (<10% probability)
2. Population regresses to 4 million (0% probability with PAP, <10% without)
3. HDB BTO prices drop drastically (0% probability, with or without PAP)
4. Casino licenses are withdrawn (0%)
5. We lose F1 hosting rights (20%)
6. Interest rate go above 5% (<30% in next 3 years)

So there you have it. Not only will prices rise, they will continue unabated until 2016 at least.

But as always, it's your money so you do your own homework :D

radha08
03-11-12, 09:03
just my 2:2cents:...a lot of people buying for rental yield but will there be tenants forever....:confused:

phantom_opera
03-11-12, 09:18
No tenant is same as gold

Yellow Horse
03-11-12, 09:43
Prices are still soaring.
Do u want to wait untill 2016 where land prices continue to soar, and more cooling measures implemented?
Unless a war breaks out.... Property might dip.. But nonetheless..
There r still good buys out there. Those which r near up coming mrt stations or malls have good upside potential. At least have some buffer if property crash. There r also good resale units, or u can consider an EC?
Which projects r u considering?

radha08
03-11-12, 09:53
No tenant is same as gold

:confused:...catch no ball..:confused:

yowetan
03-11-12, 09:56
I will buy once there is any good offer from Mt Sinai.

chestnut
03-11-12, 09:56
:confused:...catch no ball..:confused:

Gold has no 'dividend'

Lovelle
03-11-12, 10:25
Visiting show house often also gv u the confidence or feeling to buy or not buy. Whether its resale or new launch, u cld see other buyer look look see see can makw u decide if u are gonna miss de boat or boat not arrived yet.

If u see many indo buyer like i did in 2009 then u cqn safely buy

Mary Lee
03-11-12, 10:46
I am overjoyed to find this forum with so many kind-hearted, generous and helpful people. I have read all the messages carefully and will read them again and get my hubby to read them before we make the final decision. A very big "Thank You" to each and every one of you for the valuable advices.

It looks like most of you are encouraging me to buy due to many sound reasons. Then in this case, do you think a cluster unit is a good choice for own stay in terms of value? We like clusters and the data from the URA website show that the price of this group has increased less than the other groups for the past three years (please correct me if I am wrong), which gives me less pain about the waiting.

roly8
03-11-12, 10:50
what i feel is the price is too high despite the low interest rate

the couple must combine their salary in order to be able to afford the monthly long term installment.. :mad::mad:


unless my other half is richer than me...it is really too stressful for one person to hold the installment..

:beats-me-man:

buttercarp
03-11-12, 10:50
just my 2:2cents:...a lot of people buying for rental yield but will there be tenants forever....:confused:

That's why must calculate such that even if rental falls by 50%, you are still able to service the housing loan, or in the worst case scenario, ie no tenant, will must be able to hold on to it.
However I think the possibility of having no tenant is very low.
At most you let it out at a cheap rate, maybe half of the expected price, sure got many would want to rent from you.

wind30
03-11-12, 10:52
For prices to come down, the following conditions must be satisfied

1. Singapore's PAP lose election (<10% probability)
2. Population regresses to 4 million (0% probability with PAP, <10% without)
3. HDB BTO prices drop drastically (0% probability, with or without PAP)
4. Casino licenses are withdrawn (0%)
5. We lose F1 hosting rights (20%)
6. Interest rate go above 5% (<30% in next 3 years)

So there you have it. Not only will prices rise, they will continue unabated until 2016 at least.

But as always, it's your money so you do your own homework :D

Actually all you need is 6 to be satisfied for housing price to plummet. If interest rate go above 5%, I can tell you now matter how good/bad the economy is, prices will fall as rents will never cover the interest payments.

Might as well sell the house and put the money in the bank.

buttercarp
03-11-12, 11:02
Then in this case, do you think a cluster unit is a good choice for own stay in terms of value? We like clusters and the data from the URA website show that the price of this group has increased less than the other groups for the past three years (please correct me if I am wrong), which gives me less pain about the waiting.

Advantage of cluster housing:

Build- in area is large.

Disadvantages of cluster housing :

Foreigners cannot buy if the development doesn't have condo status.

It is considered strata - so the exterior does not belong to you and must vote if there are changes to be made.

If the cluster is a small development it is important that you have good neighbours.
Small development can mean when the development is old and needs major repair, each unit will have to fork out more money for the repair.

Usually cluster housing is vertical ie have to climb up many stairs, so can be tiring.

roly8
03-11-12, 11:07
I am overjoyed to find this forum with so many kind-hearted, generous and helpful people. I have read all the messages carefully and will read them again and get my hubby to read them before we make the final decision. A very big "Thank You" to each and every one of you for the valuable advices.

It looks like most of you are encouraging me to buy due to many sound reasons. Then in this case, do you think a cluster unit is a good choice for own stay in terms of value? We like clusters and the data from the URA website show that the price of this group has increased less than the other groups for the past three years (please correct me if I am wrong), which gives me less pain about the waiting.

based on my research, landed terrace house or any landed is much better than cluster..

you do not need to pay monthly maintenance fee when u go landed..

Leeds
03-11-12, 11:09
If one is renting now to house the family, he/she should seriously consider to buy a resale unit and stop paying rental immediately. Buying new and under construction in this case does not make sense. The amount of rental you are paying for the next 3 years should be a good shield against possible price correction.

Of course the risk being that price correction may take place sooner than you have anticipated. Unfortunately, that is the risk one must bite. There is no such a thing as a risk free investment.

In economic, high growth and inflation will be preceed by low growth and recession in a typical economic cycle. Property cycle on the other hand is highly correlated to the health of the economy, supply & demand and external factors such as a crisis which is beyond the control of the government or governments.

If one is in no hurry to buy and not paying rent to house one's family, your decision may well be a lot more easier.

chestnut
03-11-12, 11:11
Actually all you need is 6 to be satisfied for housing price to plummet. If interest rate go above 5%, I can tell you now matter how good/bad the economy is, prices will fall as rents will never cover the interest payments.

Might as well sell the house and put the money in the bank.

U must be young chap. Please look at past interest rate in 90s and see when interest rate was high, did prices drop. Hahaha

What goes up must come down vice-versa. But interest rate theory has no history to it.

Mary Lee
03-11-12, 11:15
what i feel is the price is too high despite the low interest rate

the couple must combine their salary in order to be able to afford the monthly long term installment.. :mad::mad:


unless my other half is richer than me...it is really too stressful for one person to hold the installment..

:beats-me-man:


Thank you for your comments. You have pointed out the most important thing to consider.

My situation is like this:- We are now staying in an HDB EM and will not consider anything smaller than that. We spend money to upgrade and not to downgrade. Since new condos built these years are usually very small, we need at least a 4-bedder (we have two kids and need a not-so-small study). On the current market, an average 4-bedder costs around 2m (not those in the suburbs - again, we want to upgrade in terms of location too), and some clusters cost slightly more than 2m, in which case I think the latter is more value for money.

My humble and honest opinion for your comments, please.

Leeds
03-11-12, 11:27
In the past, the normal interest rate was about 4% and property prices rise and fall according to economic cycle and property cycle.

The last four years, interest rate has been about 1% which is not normal. This has induced a lot more vulnerable people into the property market. Should interest rate goes back to normal, a lot more people will have to exit the market at the same time causing downward price pressure in the short to medium term.

chestnut
03-11-12, 11:43
In the past, the normal interest rate was about 4% and property prices rise and fall according to economic cycle and property cycle.

The last four years, interest rate has been about 1% which is not normal. This has induced a lot more vulnerable people into the property market. Should interest rate goes back to normal, a lot more people will have to exit the market at the same time causing downward price pressure in the short to medium term.

You really think interest rate caused people to invest in properties in Singapore. Think deeper my friend. If only it were this simple. A situation is never based on 1 single parameter. There is more.

How do u account for Aus property price increase with interest so high, what about Malaysia?

lajia
03-11-12, 11:48
Agree...:) the down under mortgage rate is about 5-7% for quite a while...



You really think interest rate caused people to invest in properties in Singapore. Think deeper my friend. If only it were this simple. A situation is never based on 1 single parameter. There is more.

How do u account for Aus property price increase with interest so high, what about Malaysia?

auroraborealis
03-11-12, 11:56
Yes agree...

My theory is everybody's naturally short property... Kids stay with parents, no roof of their own shld strive to buy 1st property to cover short & turn neutral asap (instead of spending hard earn $$$ to buy car 1st).

Ideally, when young couple get married each shld owe 1 property (which will be their own asset for retirement planning). Upon marriage, each can buy 0.5 more property (share cost to get 1 for own stay).

For young couples who buy HDB 1st, if they have at same qualifications, can strive to work hard & upon MOP, directly buy 2 PC instead of 1. This can help overcome some CMs as one property under one name :47:



Never time the market for own stay. The loss in time cannot be replaced by any amount of money. There are also simply too many waiting at the sideline for crash and once some correction comes, they will snap up... unless you really snap the unit before its even listed/launched.

Those that buy now are financially stronger. The CMs are aimed at restricting speculative investors and not aimed at lowering the price.

But do your sums and must have the ability to hold even when it corrects. It's your own zua li (money).

auroraborealis
03-11-12, 11:58
And got storage costs... Property got maintenance costs


Gold has no 'dividend'

Secretariat
03-11-12, 11:58
I think that the point Leeds is making is valid.

"The last four years, interest rate has been about 1% which is not normal. This has induced a lot more vulnerable people into the property market."

Secretariat
03-11-12, 12:04
If one is renting now to house the family, he/she should seriously consider to buy a resale unit and stop paying rental immediately. Buying new and under construction in this case does not make sense. The amount of rental you are paying for the next 3 years should be a good shield against possible price correction.

Of course the risk being that price correction may take place sooner than you have anticipated. Unfortunately, that is the risk one must bite. There is no such a thing as a risk free investment.

In economic, high growth and inflation will be preceed by low growth and recession in a typical economic cycle. Property cycle on the other hand is highly correlated to the health of the economy, supply & demand and external factors such as a crisis which is beyond the control of the government or governments.

If one is in no hurry to buy and not paying rent to house one's family, your decision may well be a lot more easier.

Thank you for the sustained, balanced postings.

I just want to add, there is no more "typical economic cycle". There is now the "boom and bust" cycle. A lot of studies in recent years have been done in this area, perhaps a reading of the works of Robert Engle can be enlightening.

Mary Lee
03-11-12, 12:17
based on my research, landed terrace house or any landed is much better than cluster..

you do not need to pay monthly maintenance fee when u go landed..


Yes, but they are more expensive and I heard security is a problem (Sorry, I don't like dogs). Somemore, there is nowhere to swim.

alamak
03-11-12, 12:26
I think that the point Leeds is making is valid.

"The last four years, interest rate has been about 1% which is not normal. This has induced a lot more vulnerable people into the property market."

Out of these how many have over-stretched themselves whether with 1 or 2 or more properties ?

At the Dec 2004 tsunami inception when the tidal wave is small and appear harmless (but unusual to bird and animal stocks) many still frolicking at beach side ..when the wave hit 3 metres in height, some even take opportunity to ride on the unusual waves thinking it is a rare opportunity to have such high waves ... when the waves hit 10 m they knew .. they cannot return to the beach any more .. the rest is history when waves hit 25 m at its apex..

lajia
03-11-12, 12:28
It looks like most of you are encouraging me to buy due to many sound reasons. Then in this case, do you think a cluster unit is a good choice for own stay in terms of value? We like clusters and the data from the URA website show that the price of this group has increased less than the other groups for the past three years (please correct me if I am wrong), which gives me less pain about the waiting.

I have gone thru similar research and here is my finding for your consideration. More for own stay scenario:

1) seems like cluster pricing has grew the slowest compared to typical landed terrace and condo. Now looking at the typical pricing of crossing 1000psf for condo in OCR, it makes cluster more attractive. Which also means, there is a bigger potential for cluster pricing to appreciate further.
2) in terms of typical landed size of 1615sqft terrace unit, you find that cluster (3500-4000sqft) is smaller but if you take the whole unit and compare, actually not true. The ground floor living room, common area could be bigger for terrace but in general as you have a typical 3.5 floors, overall seems fine when comparing the builtin area.
3) if u do not do A&A and like more of security gated compound with condo facilities, then cluster is a very obvious choice. Of course, that comes with a maintenance fee like any condo.
4) no problem with parking for cluster compared to landed (in general)
5) due to the change of rules in Apr this yr, there are more restrictions in terms of size for cluster which might restrict the number of cluster development in future.
I personally prefer cluster for own stay...The choice is yours...:o

Mary Lee
03-11-12, 12:30
Advantage of cluster housing:

Build- in area is large.

Disadvantages of cluster housing :

Foreigners cannot buy if the development doesn't have condo status.

It is considered strata - so the exterior does not belong to you and must vote if there are changes to be made.

If the cluster is a small development it is important that you have good neighbours.
Small development can mean when the development is old and needs major repair, each unit will have to fork out more money for the repair.

Usually cluster housing is vertical ie have to climb up many stairs, so can be tiring.



Thanks for the info.

Taking into consideration the one advantage and all the disadvantages, is something like $700 psf in OCR a good buy? - Condos in the same area cost from $1,200 - 1,500 psf.

roly8
03-11-12, 12:31
or get a landed and have a public swimming pool about 1km within your area :cool:

sh
03-11-12, 12:40
Advantage of cluster housing:

Build- in area is large.



Built-in area is large on paper... I wouldn't even call it built in, includes pes, roof, and carpark. Each floor is also small, so deduct the stairs, the actual usable space is space....

Large strata area doesn't translate to large usable space.....

Mary Lee
03-11-12, 13:39
Go for resale. Look hard for opportunistic buying at 10% below market transacted price. 30% downpayment for additional buffer.

Are there such things really? How and where to find them?

Paulder
03-11-12, 13:47
Hi Mary,

If you have the cash for downpayment and holding power and you are buying for own stay, I'd say just go ahead. I believe you are not going to sell your current place and that could be your additional source of fund or way out.

Money can't buy happiness, but if it can like in your case, then you should. :D

Mary Lee
03-11-12, 13:51
Prices are still soaring.
Do u want to wait untill 2016 where land prices continue to soar, and more cooling measures implemented?
Unless a war breaks out.... Property might dip.. But nonetheless..
There r still good buys out there. Those which r near up coming mrt stations or malls have good upside potential. At least have some buffer if property crash. There r also good resale units, or u can consider an EC?
Which projects r u considering?

I am sorry it's not convenient for me to disclose details here in public. If sellers see this thread and know I am so keen on their projects, they may raise asking prices hahaaaa....joking....

Mary Lee
03-11-12, 13:58
Hi Mary,

If you have the cash for downpayment and holding power and you are buying for own stay, I'd say just go ahead. I believe you are not going to sell your current place and that could be your additional source of fund or way out.

Money can't buy happiness, but if it can like in your case, then you should. :D


Thanks. What you said has also been in my mind for quite some time. If I buy one, I can get rental yield from the old one; otherwise cash in a bank can generate very little interest.

Mary Lee
03-11-12, 14:10
Visiting show house often also gv u the confidence or feeling to buy or not buy. Whether its resale or new launch, u cld see other buyer look look see see can makw u decide if u are gonna miss de boat or boat not arrived yet.

If u see many indo buyer like i did in 2009 then u cqn safely buy

I also went to see showflats before I decided whether to buy or not, but felt a bit guilty as I was actually wasting the time of the agents, who were trying to provide good services to me and not knowing I was not a serious buyer. After that going less often.

Mary Lee
03-11-12, 14:25
I have gone thru similar research and here is my finding for your consideration. More for own stay scenario:

1) seems like cluster pricing has grew the slowest compared to typical landed terrace and condo. Now looking at the typical pricing of crossing 1000psf for condo in OCR, it makes cluster more attractive. Which also means, there is a bigger potential for cluster pricing to appreciate further.
2) in terms of typical landed size of 1615sqft terrace unit, you find that cluster (3500-4000sqft) is smaller but if you take the whole unit and compare, actually not true. The ground floor living room, common area could be bigger for terrace but in general as you have a typical 3.5 floors, overall seems fine when comparing the builtin area.
3) if u do not do A&A and like more of security gated compound with condo facilities, then cluster is a very obvious choice. Of course, that comes with a maintenance fee like any condo.
4) no problem with parking for cluster compared to landed (in general)
5) due to the change of rules in Apr this yr, there are more restrictions in terms of size for cluster which might restrict the number of cluster development in future.
I personally prefer cluster for own stay...The choice is yours...:o


Thanks, but you and I are the minority on this forum and probably in Singapore. Maybe that's why cluster prices could not rise much?

Leeds
03-11-12, 14:47
You really think interest rate caused people to invest in properties in Singapore. Think deeper my friend. If only it were this simple. A situation is never based on 1 single parameter. There is more.

How do u account for Aus property price increase with interest so high, what about Malaysia?


The low interest rate has INDUCED MORE vulnerable people into the market. It also encourages more people to leverage.

Australia interest rate had been even higher than what they are now.

There was nothing in my writing suggesting that interest rate is the single parameter. We happen to discuss about interest rate and so it is a factor (quite a strong one) to induce buying.

radha08
03-11-12, 15:05
I also went to see showflats before I decided whether to buy or not, but felt a bit guilty as I was actually wasting the time of the agents, who were trying to provide good services to me and not knowing I was not a serious buyer. After that going less often.

please dont feel sorry for agents....they are mostly thick skinned people with no feelings....:o

lifeline
03-11-12, 15:06
Thanks, but you and I are the minority on this forum and probably in Singapore. Maybe that's why cluster prices could not rise much?



you may be right!
herein lies the catch 22 - lower price makes one wonder, higher price makes one complain. as often said, too much analysis promotes paralysis.

after looking around, and brainstorming... finally... just go with your heart esp since this is for your own stay. cheers !

radha08
03-11-12, 15:06
The low interest rate has INDUCED MORE vulnerable people into the market. It also encourages more people to leverage.

Australia interest rate had been even higher than what they are now.

There was nothing in my writing suggesting that interest rate is the single parameter. We happen to discuss about interest rate and so it is a factor (quite a strong one) to induce buying.

so what do you think would make interest rates rise in singapore...:confused:

indomie
03-11-12, 15:13
The amount of money in existance is simply too much now. If we all decided to spend it all at the same time, simply there is not enough of goods to buy. As time goes by the amount of money in existence keep increasing and the amount of goods keep decreasing. This is the fact, no matter if the economy is good or bad. No matter if the interest rate is low or high.

Another fact, its always going to be tougher to buy in the future. Population will increase. Even in land rich country like Indonesia, we understand that even if the land itself is free, building infrastuctures and labour cost will always increase. Let alone sg that is small and the land itself worth in gold. I always believe if property won't make u rich, at least your children will.

buttercarp
03-11-12, 15:26
Thanks for the info.

Taking into consideration the one advantage and all the disadvantages, is something like $700 psf in OCR a good buy? - Condos in the same area cost from $1,200 - 1,500 psf.

Actually I forgot the other advantages eg better security and some facilities that are available in cluster housing as have been pointed out by the other bros.

If I really had to get a cluster house, I will choose either a FH or 999y. For 99 LH it must be brand new.
If it is $700 psf and the build- up area is 3000 sq ft, that would be 2.1mil.
I personally can't bring myself to spend that amount for a cluster house.
I would rather spend a bit for and buy a high rise unit, or buy an old landed and rebuild when the time is ripe.



please dont feel sorry for agents....they are mostly thick skinned people with no feelings....:o

LOL.... you make them sound like reptiles!
But reptiles also need to eat.

Btw bro, saw this advert, may interest you?
http://www.propertyguru.com.sg/listing/12001947/for-sale-figaro-street-vicinity

lajia
03-11-12, 16:03
Actually I forgot the other advantages eg better security and some facilities that are available in cluster housing as have been pointed out by the other bros.

If I really had to get a cluster house, I will choose either a FH or 999y.
I would rather spend a bit for and buy a high rise unit, or buy an old landed and rebuild when the time

Interesting, may I know why would you rather spend a bit more on a high rise unit than a cluster?? :scared-5: if it is a personal preference, then alright, but thought I might learn something new...:)

DKSG
03-11-12, 18:07
Interesting, may I know why would you rather spend a bit more on a high rise unit than a cluster?? :scared-5: if it is a personal preference, then alright, but thought I might learn something new...:)

Butter is a smart investor!

High rise unit certainly has better returns (in general) compared t cluster.

There are some hidden problems with cluster which have not surfaced yet, you will hear more in the coming years.

Office Boy not vested in cluster.

DKSG

imjason
03-11-12, 18:41
Thanks. What you said has also been in my mind for quite some time. If I buy one, I can get rental yield from the old one; otherwise cash in a bank can generate very little interest.

I am in the same dilemma to choose between cluster at Tanah Merah and 99 Y Loyang landed...

Personally I would prefer Tanah Merah but the price has shot up since ECO launched...

LoyangRise is one of the most affordable landed but worry the cramping neighborhood...

:doh:

DKSG
03-11-12, 18:43
I am in the same dilemma to choose between cluster at Tanah Merah and 99 Y Loyang landed...

Personally I would prefer Tanah Merah but the price has shot up since ECO launched...

LoyangRise is one of the most affordable landed but worry the cramping neighborhood...

:doh:

Generally TM still got some more upside.
LR is a high risk high return bet. You buy low, but there is a not small chance it will not move much in the near future.

Just my 2.2 cents opinion

DKSG

buttercarp
03-11-12, 18:51
Interesting, may I know why would you rather spend a bit more on a high rise unit than a cluster?? :scared-5: if it is a personal preference, then alright, but thought I might learn something new...:)

It is a personal choice.
I like to stay in high floor ( all my life I live in very high floor).
I will only stay on the ground if it is 999LH or FH landed.

Spend a bit more for hi rise unit than cluster - it is bcos it is easier to sell high rise unit and easier to let out as pointed out by office boy. Majority of people prefer high floor.



Butter is a smart investor!

High rise unit certainly has better returns (in general) compared t cluster.

There are some hidden problems with cluster which have not surfaced yet, you will hear more in the coming years.

Office Boy not vested in cluster.

DKSG

Office boy, I am a mutant powerpuff girl.... no where near an investor. But learning the ropes from office boy and the other gurus.

DKSG
03-11-12, 19:04
It is a personal choice.
I like to stay in high floor ( all my life I live in very high floor).
I will only stay on the ground if it is 999LH or FH landed.

Spend a bit more for hi rise unit than cluster - it is bcos it is easier to sell high rise unit and easier to let out as pointed out by office boy. Majority of people prefer high floor.




Office boy, I am a mutant powerpuff girl.... no where near an investor. But learning the ropes from office boy and the other gurus.

You are doing very very well for a mutant!
Office Boy is just ... an office boy. Haha!

DKSG

Mary Lee
03-11-12, 19:09
you may be right!
herein lies the catch 22 - lower price makes one wonder, higher price makes one complain. as often said, too much analysis promotes paralysis.

after looking around, and brainstorming... finally... just go with your heart esp since this is for your own stay. cheers !

Thanks. I guess the final choice will go like that.

wind30
03-11-12, 19:11
U must be young chap. Please look at past interest rate in 90s and see when interest rate was high, did prices drop. Hahaha

What goes up must come down vice-versa. But interest rate theory has no history to it.

Izzit? dunno leh... when I talk to my friends about property prices and interest rates, usually the discussion is not whether the price will fall if interest rates go up to 5%.... but rather if it will go up to 5%.

I think a lot of buyers don't think it will go up to 5% near term or ever.... Don't take my word for it. talk to your friends....

To me if interest rates go up 5%, mathematically, at today's prices, it is a sure win deal to sell the house, take the money and put it in the bank.

I mean if your condo is 1.5million which is rented out for like 4k/month (after all the deductions for maintenance, etc). You rental income is like 48k/year. Why not just put the 1.5million in the bank and get back 75k/year? Assuming the house is fully paid. Even if it is not fully paid, the maths is the same if we assume your housing loan rates and deposit rates are identical.

This is maths... todays prices only make sense if interest rates are like 1%....

Mary Lee
03-11-12, 19:17
Actually I forgot the other advantages eg better security and some facilities that are available in cluster housing as have been pointed out by the other bros.

Btw bro, saw this advert, may interest you?
http://www.propertyguru.com.sg/listing/12001947/for-sale-figaro-street-vicinity

Thanks, but this one got high psf price and small area leh. I consider clusters because many of them got large area with relatively lower psf price.

price
03-11-12, 19:18
Izzit? dunno leh... when I talk to my friends about property prices and interest rates, usually the discussion is not whether the price will fall if interest rates go up to 5%.... but rather if it will go up to 5%.

I think a lot of buyers don't think it will go up to 5% near term or ever.... Don't take my word for it. talk to your friends....

To me if interest rates go up 5%, mathematically, at today's prices, it is a sure win deal to sell the house, take the money and put it in the bank.

I mean if your condo is 1.5million which is rented out for like 4k/month (after all the deductions for maintenance, etc). You rental income is like 48k/year. Why not just put the 1.5million in the bank and get back 75k/year? Assuming the house is fully paid. Even if it is not fully paid, the maths is the same if we assume your housing loan rates and deposit rates are identical.

This is maths... todays prices only make sense if interest rates are like 1%....
huh? what about potential capital gain as u rake in the rental yield

groggy
03-11-12, 19:31
It is a personal choice.
I like to stay in high floor ( all my life I live in very high floor).
I will only stay on the ground if it is 999LH or FH landed.

Spend a bit more for hi rise unit than cluster - it is bcos it is easier to sell high rise unit and easier to let out as pointed out by office boy. Majority of people prefer high floor.




Office boy, I am a mutant powerpuff girl.... no where near an investor. But learning the ropes from office boy and the other gurus.
For cluster homes in Singapore, may I know if you are allowed to park 2 cars in the house and more at the street? In Malaysia, cluster houses are what we call gated and guarded landed terraces. They are very popular because besides having security and common facilities like in condos, owners are also able to park their cars in their own front porch just like in normal terraces. In other words, are there any landed terraces in a gated environment in Singapore? Or, are cluster houses in Singapore actually townhouses with basement car parks or car parks in common allocated area? Bear in mind, in Malaysia, townhouses also have their own car parks in the front porch. The difference between terrace and townhouse is merely the sharing of the ground floor entrance.

minority
03-11-12, 19:41
Supply vs demand.

Yes a lot of supply is coming on stream, but the demand is so freaking huge it's not funny. EVERYBODY I know who is >20 years old to even 50 years old is thinking of buying and investing in property. This type of groupthink is unheard of 10 years ago.

There are many many cash rich folks out there. Even those who lack cash, I have personally witnessed some super garang types who will go to 5 or 6 different banks, borrow unsecured loans at 8-12% INTEREST, just to pay for that downpayment!

And appreciating property prices create a vicious cycle. Many people are taking equity loans against their appreciated properties, and using them to buy more properties! Even though this is not allowed in law, but the money will somehow end up back in the market chasing prices higher and higher.

Funny thing is, properties are like Veblen goods now. The more the price goes up, and the more difficult it is to buy one (via CMs), then the more people are willing to pay higher prices to own one. Nobody wants to miss the bandwagon this time.

For prices to come down, the following conditions must be satisfied

1. Singapore's PAP lose election (<10% probability)
2. Population regresses to 4 million (0% probability with PAP, <10% without)
3. HDB BTO prices drop drastically (0% probability, with or without PAP)
4. Casino licenses are withdrawn (0%)
5. We lose F1 hosting rights (20%)
6. Interest rate go above 5% (<30% in next 3 years)

So there you have it. Not only will prices rise, they will continue unabated until 2016 at least.

But as always, it's your money so you do your own homework :D

u left out un employment rate at >20%.

buttercarp
03-11-12, 19:49
Thanks, but this one got high psf price and small area leh. I consider clusters because many of them got large area with relatively lower psf price.

Sorry sis..... I was actually recommending that to bro radha :o .
I know you looking for one which has at least 4 rooms or more.

Actually, long time ago, I really liked Binjai Crest and almost bought it but did not. But now it is old and it is 99yLH.


For cluster homes in Singapore, may I know if you are allowed to park 2 cars in the house and more at the street? In Malaysia, cluster houses are what we call gated and guarded landed terraces. They are very popular because besides having security and common facilities like in condos, owners are also able to park their cars in their own front porch just like in normal terraces. In other words, are there any landed terraces in a gated environment in Singapore? Or, are cluster houses in Singapore actually townhouses with basement car parks or car parks in common allocated area? Bear in mind, in Malaysia, townhouses also have their own car parks in the front porch. The difference between terrace and townhouse is merely the sharing of the ground floor entrance.


Depends on the development. Some only can park one car in the compound.
No lah..... many differences not just "merely".

groggy
03-11-12, 19:59
Sorry sis..... I was actually recommending that to bro radha :o .
I know you looking for one which has at least 4 rooms or more.

Actually, long time ago, I really liked Binjai Crest and almost bought it but did not. But now it is old and it is 99yLH.




Depends on the development. Some only can park one car in the compound.
No lah..... many differences not just "merely".
I can't understand why cluster houses in Singapore has lower capital appreciation compared to normal landed or condos because it is actually normal landed terrace PLUS condo facilities. In Malaysia, the capital appreciation of such gated and guarded landed terraces is actually higher than normal terraces and condos.

buttercarp
03-11-12, 20:11
I can't understand why cluster houses in Singapore has lower capital appreciation compared to normal landed or condos because it is actually normal landed terrace PLUS condo facilities. In Malaysia, the capital appreciation of such gated and guarded landed terraces is actually higher than normal terraces and condos.

You may want to refer to this thread where it was already discussed :sleep: .

http://forums.condosingapore.com/showthread.php?t=11732

lajia
03-11-12, 20:24
http://www.propertyguru.com.sg/listing/12068115/for-sale-the-woods

Something like that....:2cents:




Thanks, but this one got high psf price and small area leh. I consider clusters because many of them got large area with relatively lower psf price.

chestnut
03-11-12, 20:26
Interesting point. I buy your theory. Question is, when interest rate on house hits 5%, fd should be 4% there abouts rite? The key is, what would be inflation?
Rental is subject to vacancy rate, rite?

I am not endorsing buying props, don't get me wrong. Buying props can be a dangerous game if you over leverage and especially when u lose your job. So the key is to enter wisely.

But I appreciate your point. You at least have a strategy in place. For me, it is a different game. I am now looking at other opportunities.


:cheers3: :cheers3:



Izzit? dunno leh... when I talk to my friends about property prices and interest rates, usually the discussion is not whether the price will fall if interest rates go up to 5%.... but rather if it will go up to 5%.

I think a lot of buyers don't think it will go up to 5% near term or ever.... Don't take my word for it. talk to your friends....

To me if interest rates go up 5%, mathematically, at today's prices, it is a sure win deal to sell the house, take the money and put it in the bank.

I mean if your condo is 1.5million which is rented out for like 4k/month (after all the deductions for maintenance, etc). You rental income is like 48k/year. Why not just put the 1.5million in the bank and get back 75k/year? Assuming the house is fully paid. Even if it is not fully paid, the maths is the same if we assume your housing loan rates and deposit rates are identical.

This is maths... todays prices only make sense if interest rates are like 1%....

wind30
03-11-12, 20:27
huh? what about potential capital gain as u rake in the rental yield

Capital gain? If prices fall got capital gain meh?

If interest rates fall by another 2 percent maybe got capital gain.

chestnut
03-11-12, 20:30
u left out un employment rate at >20%.

Bro, to me u pointed out the scariest part about any investment. If really kanna like this, liao-finish !!!:scared-1:

Stocks will drop first, then car, then houses. This is any govt nitemare. There will be riots. Then better move to another country.

Mary Lee
03-11-12, 21:00
You may want to refer to this thread where it was already discussed :sleep: .

http://forums.condosingapore.com/showthread.php?t=11732


Thanks Butter. The thread you recommended provides some more useful information for me.

I think cluster house is cheaper than an equivalent landed in the same district.

Maybe will also entice those who have $2-2.5mil in cash who is looking at condo ..but suddenly find that for the same money, can buy a very big house. So they are not looking at land per se.. they are actually just looking at buying a condo but now with bigger sqft.

I am sure they were talking about me haha....

leesg123
03-11-12, 21:05
Bro, to me u pointed out the scariest part about any investment. If really kanna like this, liao-finish !!!:scared-1:

Stocks will drop first, then car, then houses. This is any govt nitemare. There will be riots. Then better move to another country.Move to Malaysia! Malaysia boleh!

chestnut
03-11-12, 21:07
Move to Malaysia! Malaysia boleh!

Haha. U may be rite.:cheers3:

focus
03-11-12, 21:13
Thanks, but you and I are the minority on this forum and probably in Singapore. Maybe that's why cluster prices could not rise much?


i've been to some clusters that has TOP. Agreed the pricing is very attractive in terms of psf. But I find most of them are built too close to each other for comfort. To top it off, they are always in full-height windows configuration.

So in the end, you go home and you have to draw your curtains for all your bedrooms.

I also think landed is good if you are comparing it using built-in versus the clusters.

Mary Lee
03-11-12, 21:22
http://www.propertyguru.com.sg/listing/12068115/for-sale-the-woods

Something like that....:2cents:


Wow, this one is so good for me - big space, brand new, can move in next year, low psf... except that it is a bit far from city. Will shortlist this one anyway. Thanks Thanks.

radha08
03-11-12, 22:49
Btw bro, saw this advert, may interest you?
http://www.propertyguru.com.sg/listing/12001947/for-sale-figaro-street-vicinity

tks sis but right now with the new cm i feel balder than the agent advertising that property...:scared-1:...but but but...my move back into the heartlands has made my quest for a property stronger than ever...1 year in a semi-d in frankel was just not the right enviroment to start house hunting cos after all the viewings i would comeback to the bliss and peace that BIG landed living offers and would forget all my viewings...but NOW...from the heart of the heartlands i feel a very strong urge...to break all boundaries that cross my path and raise my hands into the air and plunge into that hidden abyss of the unknown...urgh sorry ha but in laymans terms it means basically just buy an apt...lah..:D:D:D..something that suits me and my family's lifestyle BEST....:santana::cheers4:

groggy
03-11-12, 23:23
You may want to refer to this thread where it was already discussed :sleep: .

http://forums.condosingapore.com/showthread.php?t=11732

Thanks for the link. Now I know cluster houses are actually very thin and tall and go up to 4 storey high whereas in Malaysia the gated and guarded landed terraces are actually sitting on plot of 22*80 or 24*80.

leesg123
03-11-12, 23:36
Wow, this one is so good for me - big space, brand new, can move in next year, low psf... except that it is a bit far from city. Will shortlist this one anyway. Thanks Thanks.lol, is not abit far, is extremely far from the city.

lajia
03-11-12, 23:41
If your kids study in Ntu then it is very near, if u everyday go to airport then of course very far. If u go to orchard road everyday, then maybe subjective if you compare to punggol or woodland or seletar.....all these are relative.....:D

lol, is not abit far, is extremely far from the city.

yowetan
03-11-12, 23:51
Mt Sinai is a good place - it is near to schools, ITE, polytechnics, universities and hospitals.

Many choice(s), and central to all places in Singapore. You won't go wrong with this area.

Laguna
03-11-12, 23:57
Mt Sinai is a good place - it is near to schools, ITE, polytechnics, universities and hospitals.

Many choice(s), and central to all places in Singapore. You won't go wrong with this area.

yes, you are forever RIGHT

kane
04-11-12, 00:00
Capital gain? If prices fall got capital gain meh?

If interest rates fall by another 2 percent maybe got capital gain.

the story doesn't end at interest rate going to 5%. the question is what is the economic situation when interest rate hits 5%. one of rampant unemployment, or a period of prolonged economic expansion?

Laguna
04-11-12, 00:13
the story doesn't end at interest rate going to 5%. the question is what is the economic situation when interest rate hits 5%. one of rampant unemployment, or a period of prolonged economic expansion?

Do u think US can afford to pay interest on their US$16T debt at 5%?

Mary Lee
04-11-12, 05:49
lol, is not abit far, is extremely far from the city.


You are right lah.

I think it is good for retirement or for those who work in the west, like NTU, and have enough patience to wait for everything in Jurong to be up.

Developer sale at around $500 psf. Is this the lowest psf price for a new home nowadays?

wind30
04-11-12, 06:25
the story doesn't end at interest rate going to 5%. the question is what is the economic situation when interest rate hits 5%. one of rampant unemployment, or a period of prolonged economic expansion?

I don't think so. Even if you have money, you will want to sell.

amk
04-11-12, 09:54
I don't think so. Even if you have money, you will want to sell.

You are overly preoccupied with interest rate already. Just over 5% u will sell already ? That's a conservative risk adverse mindset. You have to look at the whole economy at a context. Aus rates are perpetually over 4%, and their pty prices never drop over the last 30yrs.

DC33_2008
04-11-12, 10:10
Landed better as you can have your design but not cluster housing.
i've been to some clusters that has TOP. Agreed the pricing is very attractive in terms of psf. But I find most of them are built too close to each other for comfort. To top it off, they are always in full-height windows configuration.

So in the end, you go home and you have to draw your curtains for all your bedrooms.

I also think landed is good if you are comparing it using built-in versus the clusters.

roly8
04-11-12, 10:17
from what i observe, interest rate will keep at an affordable rate for a long time.. :o

but that doesn't make me want to buy property, still..
:ashamed1:

total % yield for property bought nowadays might not be that attractive but who knows..price might skyrocket again.. :scared-5:


anyway, i am quite timid to buy as not very good in real-life property stuffs.

more pro in internet related stuffs though. :banghead::banghead:

maybe my best investment is still continue develop my IT biz :D


- Your Nerdy roly

seletar
04-11-12, 13:32
what i feel is the price is too high despite the low interest rate

the couple must combine their salary in order to be able to afford the monthly long term installment.. :mad::mad:


unless my other half is richer than me...it is really too stressful for one person to hold the installment..

:beats-me-man:


Actually, prices are very high because the low interest rates are already priced into property. In other words, the developers get to profit from most of the low interest rates savings of the buyer, while the buyer takes on the big risk of interest rates going up.

If one can barely afford the property at 1.5% interest, my suggestion is don't buy. Investing in a property is a huge, long term commitment for many people, and I've seen people go bankrupt from property in the past.

"Buy Low, Sell High", this simple rule of investing has served me well. When investing, one should ask himself/herself is this stage of the cycle worth it to invest ?

Just for info, Kwek Leng Beng said in a recent interview in CNBC that he expects price correction in SG property and an oversupply in 2014 and 2015.

CapitalLand is also getting concerned and now giving 6% dicount for SkyHabitat, but the discount is still too little IMO.

Mary Lee
04-11-12, 13:51
Actually, prices are very high because the low interest rates are already priced into property. In other words, the developers get to profit from most of the low interest rates savings of the buyer, while the buyer takes on the big risk of interest rates going up.

If one can barely afford the property at 1.5% interest, my suggestion is don't buy. Investing in a property is a huge, long term commitment for many people, and I've seen people go bankrupt from property in the past.

"Buy Low, Sell High", this simple rule of investing has served me well. When investing, one should ask himself/herself is this stage of the cycle worth it to invest ?

Just for info, Kwek Leng Beng said in a recent interview in CNBC that he expects price correction in SG property and an oversupply in 2014 and 2015.

CapitalLand is also getting concerned and now giving 6% dicount for SkyHabitat, but the discount is still too little IMO.


Many Thanks.

Do you think we should wait wait and see see even for own stay? And do you think the next price correction will be big enough to be worth the waiting?

DC33_2008
04-11-12, 13:58
How to launch South Beach if CDL boss said correction will happen in 2 years time? I heard South Beach VVIP list is by invitation.
Actually, prices are very high because the low interest rates are already priced into property. In other words, the developers get to profit from most of the low interest rates savings of the buyer, while the buyer takes on the big risk of interest rates going up.

If one can barely afford the property at 1.5% interest, my suggestion is don't buy. Investing in a property is a huge, long term commitment for many people, and I've seen people go bankrupt from property in the past.

"Buy Low, Sell High", this simple rule of investing has served me well. When investing, one should ask himself/herself is this stage of the cycle worth it to invest ?

Just for info, Kwek Leng Beng said in a recent interview in CNBC that he expects price correction in SG property and an oversupply in 2014 and 2015.

CapitalLand is also getting concerned and now giving 6% dicount for SkyHabitat, but the discount is still too little IMO.

carbuncle
04-11-12, 14:04
What cycle? Its an outdated concept.

Long term big picture its goin to be a straight line UP.

We should be happy its not an exponential parabola UP.

Paulder
04-11-12, 14:08
Optimism at its best?


What cycle? Its an outdated concept.

Long term big picture its goin to be a straight line UP.

We should be happy its not an exponential parabola UP.

carbuncle
04-11-12, 14:19
Optimism at its best?

No. History has proven so. BIG picture, my friend. Not micro trading.

roly8
04-11-12, 14:25
How to launch South Beach if CDL boss said correction will happen in 2 years time? I heard South Beach VVIP list is by invitation.

VVIP are rich and will not bother about $$ .. probably source fund from company pocket... :p :o:o




What cycle? Its an outdated concept.

Long term big picture its goin to be a straight line UP.

We should be happy its not an exponential parabola UP.

asia is certainly in the lead for the future :D

Paulder
04-11-12, 14:42
http://mistymoon.com.sg/img/Property/Screen%20shot%202012-11-04%20at%20PM%2003.39.41.png

http://mistymoon.com.sg/img/Property/Screen%20shot%202012-11-04%20at%20PM%2003.32.29.png

No doubt, but you did not mention anything about holding power. Perhaps not everyone here is as able to withstand downturns as you?



No. History has proven so. BIG picture, my friend. Not micro trading.

wind30
04-11-12, 15:00
You are overly preoccupied with interest rate already. Just over 5% u will sell already ? That's a conservative risk adverse mindset. You have to look at the whole economy at a context. Aus rates are perpetually over 4%, and their pty prices never drop over the last 30yrs.

... Let me explain. You have to understand where today's price is at. If today's condo price is at 600psf I also agree that 5 percent interest rate never mind.

You think why property prices went up so much in the past 3 years. Our economy very good meh? All because of close to zero interest rates. All the rental yield numbers only make sense if interest is low.

wind30
04-11-12, 15:02
Do u think US can afford to pay interest on their US$16T debt at 5%?

Singapore could follow other countries and unpegged from usd. This is what us fed suggest too. Possible in the future.

leesg123
04-11-12, 15:03
... Let me explain. You have to understand where today's price is at. If today's condo price is at 600psf I also agree that 5 percent interest rate never mind.

You think why property prices went up so much in the past 3 years. Our economy very good meh? All because of close to zero interest rates. All the rental yield numbers only make sense if interest is low.how about the fact that smrt, our gov, health care, got implement pay adjustment that see salary goes up by >10%. economy not good can do so meh?

Paulder
04-11-12, 15:08
ERP rates just went up. :)


how about the fact that smrt, our gov, health care, got implement pay adjustment that see salary goes up by >10%. economy not good can do so meh?

roly8
04-11-12, 15:15
Singapore could follow other countries and unpegged from usd. This is what us fed suggest too. Possible in the future.
wait until usd get unpeg from gold .. :hell-hath-no-fury::hell-hath-no-fury:

DC33_2008
04-11-12, 16:00
Stay in or closer to CBD if you are working in town.
ERP rates just went up. :)

Paulder
04-11-12, 16:26
I was commenting about the source of funds that government have at their disposal actually.

But good advice there, unfortunately I'm not amongst the top dunno how many % to afford your suggestion though. :(

Sorry for digressing, think we are very far away from the original intent of this thread.. End of OT!


Stay in or closer to CBD if you are working in town.

Arcachon
04-11-12, 18:07
I was commenting about the source of funds that government have at their disposal actually.

But good advice there, unfortunately I'm not amongst the top dunno how many % to afford your suggestion though. :(

Sorry for digressing, think we are very far away from the original intent of this thread.. End of OT!

The source of funds that gov have at their disposal depend on what's in the mind can think of. A piece of paper call COE can be a source of fund whereas our neighbor need to built factory, employ worker,......

indomie
04-11-12, 18:14
Singapore could follow other countries and unpegged from usd. This is what us fed suggest too. Possible in the future.
1.00 USD = 0.80 SGD

carbuncle
04-11-12, 18:57
No doubt, but you did not mention anything about holding power. Perhaps not everyone here is as able to withstand downturns as you?

These are excellent charts, where did u get them?

The first chart is exponential typical of developing nation in organic growth stage. The second chart, now, that decade is unlike any other.

Financial crises, dotcom bubble bust, SARS.... The list goes on. The world has learnt to better manage such, hopefully, so the rate of decline should be well controlled the next decades should anything similar break out. Short of WW3, which by then property would b last on anyones mind anyway.

The mere fact that land is limited on earth and especially city states will contribute to the increased sustained growth in prices and value until we discover more habitable lands on the Moon.

amk
04-11-12, 18:58
... All because of close to zero interest rates....

Disagree. First, the reason iteelf is multitude, you can find enough posts here about the under built HDB story and immigration story. 0 interest is just part of it.

2nd, it is natural for asset price to rise when value of money drops. Cheap money creates inflation, but inflation is sticky. After x yrs of inflation, let say monetary policy tightened, inflation drops, do you expect consumable prices to *drop* ? That is akin to expect $2 chicken price will come back. No, inflation is sticky by nature.

3rd, now we all know it will take a long time before the world can see high interest, is this 5y window an opportunity ? especially for the young, do you expect your earning capacity remain the same 5yrs later ?

4th, I applaud MAS for doing its job to make sure what you fear do not happen. This was not the case in Spain or US housing bubble. Today, 60% or less LTV with 20y tenor , 4y "holding period", greatly reduces the system risk.

carbuncle
04-11-12, 19:01
Disagree. First, the reason iteelf is multitude, you can find enough posts here about the under built HDB story and immigration story. 0 interest is just part of it.

2nd, it is natural for asset price to rise when value of money drops. Cheap money creates inflation, but inflation is sticky. After x yrs of inflation, let say monetary policy tightened, inflation drops, do you expect consumable prices to *drop* ? That is akin to expect $2 chicken price will come back. No, inflation is sticky by nature.

3rd, now we all know it will take a long time before the world can see high interest, is this 5y window an opportunity ? especially for the young, do you expect your earning capacity remain the same 5yrs later ?

4th, I applaud MAS for doing its job to make sure what you fear do not happen. This was not the case in Spain or US housing bubble. Today, 60% or less LTV with 20y tenor , 4y "holding period", greatly reduces the system risk.

Bravo, the old bird has spoken. Young cocks pls take heed.

Arcachon
04-11-12, 19:26
1.00 USD = 0.80 SGD

http://www.youtube.com/watch?v=OR2CLV2fVsM&feature=relmfu

USD is still very strong, don't be mislead by Fed.

No factory manufacturing.

IBM ticketing.

Why IBM sell computer manufacturing to Lenovo.

roly8
04-11-12, 19:30
Disagree. First, the reason iteelf is multitude, you can find enough posts here about the under built HDB story and immigration story. 0 interest is just part of it.

2nd, it is natural for asset price to rise when value of money drops. Cheap money creates inflation, but inflation is sticky. After x yrs of inflation, let say monetary policy tightened, inflation drops, do you expect consumable prices to *drop* ? That is akin to expect $2 chicken price will come back. No, inflation is sticky by nature.

3rd, now we all know it will take a long time before the world can see high interest, is this 5y window an opportunity ? especially for the young, do you expect your earning capacity remain the same 5yrs later ?

4th, I applaud MAS for doing its job to make sure what you fear do not happen. This was not the case in Spain or US housing bubble. Today, 60% or less LTV with 20y tenor , 4y "holding period", greatly reduces the system risk.

thx for sharing...:o

just wish i have a property before the boom..
haiz :(
now only can sit one side and jealous of others.. :ashamed1::ashamed1:

buttercarp
04-11-12, 19:40
Today I was at Bedok Central.
Haven't been to the site of the old Bedok Interchange ever since they started construction.
A wave of sadness hit me.
I miss the old Bedok Interchange.
It held years of happy memories since primary school for me and now its gone.......

roly8
04-11-12, 19:45
Today I was at Bedok Central.
Haven't been to the site of the old Bedok Interchange ever since they started construction.
A wave of sadness hit me.
I miss the old Bedok Interchange.
It held years of happy memories since primary school for me and now its gone.......
ms buttercup, please start a new thread about old singapore :D

Arcachon
04-11-12, 19:51
Miss the spider.

http://www.youtube.com/watch?v=W1dm1lx97Tg

Paulder
04-11-12, 20:08
Here you go. :)

http://www.singaporerealestate.info/property%20price%20index%201960%20to%202010.htm


These are excellent charts, where did u get them?

The first chart is exponential typical of developing nation in organic growth stage. The second chart, now, that decade is unlike any other.

Financial crises, dotcom bubble bust, SARS.... The list goes on. The world has learnt to better manage such, hopefully, so the rate of decline should be well controlled the next decades should anything similar break out. Short of WW3, which by then property would b last on anyones mind anyway.

The mere fact that land is limited on earth and especially city states will contribute to the increased sustained growth in prices and value until we discover more habitable lands on the Moon.

Paulder
04-11-12, 20:15
Yes very much for me too! The rocket that I used to wait for my classmates at the interchange, Sunshine kiosk, KFC, Transit-link office.... haiz


Today I was at Bedok Central.
Haven't been to the site of the old Bedok Interchange ever since they started construction.
A wave of sadness hit me.
I miss the old Bedok Interchange.
It held years of happy memories since primary school for me and now its gone.......

teddybear
04-11-12, 20:29
Wrong! Main reason is because paper money dropping in value over time due to massive and continuous money printing! Near zero interest rates is a by-product, and not the cause. :D


... Let me explain. You have to understand where today's price is at. If today's condo price is at 600psf I also agree that 5 percent interest rate never mind.

You think why property prices went up so much in the past 3 years. Our economy very good meh? All because of close to zero interest rates. All the rental yield numbers only make sense if interest is low.

teddybear
04-11-12, 20:31
If S$ is pegged to US$, how do you explain that now US$1 can exchange for S$1.22 while previously US$1 can exchange for >S$1.80? :doh:


Singapore could follow other countries and unpegged from usd. This is what us fed suggest too. Possible in the future.

Paulder
04-11-12, 20:56
Think they are talking about interest rates, not currency...


If S$ is pegged to US$, how do you explain that now US$1 can exchange for S$1.22 while previously US$1 can exchange for >S$1.80? :doh:

lifeline
04-11-12, 21:10
Why IBM sell computer manufacturing to Lenovo.



dun know whether this is good or not for the company - short term profit gratification vs ? sacrificing longterm strategy.


this is the innovator's dilemma.

eg toyota went into us with the lower lines. ford / gm removed their less profitable lines and progressively got squeezed out from the bottom up, and toyota just rammed up from the bottom to lexus.

eg intel learned from this - with help. with competitors coming in from the bottom, they continued to move up the line; and created another new cheaper celeron line to compete at the bottom too!


listen to all this on bbc link found here:

http://forums.condosingapore.com/showthread.php?t=15545



in fact this management understanding can be applied to our personal lives too.
still learning.

Arcachon
04-11-12, 21:16
Think they are talking about interest rates, not currency...

What MAS focuses on is the trade-weighted exchange rate. It manages the Sing dollar against an undisclosed basket of currencies of Singapore's major trading partners and competitors. Last year, the country's top trading partners were Malaysia, Europe, China, Indonesia and the US.

MAS allows the trade-weighted exchange rate to fluctuate within a secret policy band. When the rate crosses this band, the central bank steps in to buy or sell foreign exchange to steer it back.

http://zoomdr.blogspot.fr/2012/03/singapores-exchange-rate-policy.html

Arcachon
04-11-12, 21:18
dun know whether this is good or not for the company - short term profit gratification vs ? sacrificing longterm strategy.


this is the innovator's dilemma.

eg toyota went into us with the lower lines. ford / gm removed their less profitable lines and progressively got squeezed out from the bottom up, and toyota just rammed up from the bottom to lexus.

eg intel learned from this - with help. with competitors coming in from the bottom, they continued to move up the line; and created another new cheaper celeron line to compete at the bottom too!


listen to all this on bbc link found here:

http://forums.condosingapore.com/showthread.php?t=15545



in fact this management understanding can be applied to our personal lives too.
still learning.

American is doing manufacturing without the factory.

lifeline
04-11-12, 21:27
thx for sharing...:o

just wish i have a property before the boom..
haiz :(
now only can sit one side and jealous of others.. :ashamed1::ashamed1:



actually need to do your own reading of the future and decide where you stand. ie make a conscientious effort. use your rear view mirror of past data for you to make an educated predicted outcome of the future and not be paralysed by regrets of past inaction or otherwise. so that we do not in future regret the inaction of the present moment.

then you decide what next? if you decide to go in and is hampered by quantum, etc, then you will look for your own solutions, like progressive payments of new launches, sharing with like-minded partners, etc.



we need to also not forget that creating a strategy for wealth in future also includes creating good health for ourselves (healthy body with less stress for mind) and healthy investments into interactions with the people around us.

http://forums.condosingapore.com/showthread.php?t=15545



p/s: this is not an inducement to be bullish (make your own judgement call), but a call for us, and a reminder for myself, to remember to create a strategy for our own lives now and in the future.

lifeline
04-11-12, 21:33
American is doing manufacturing without the factory.


was looking at the strategy within the company regards lower cost product lines.

Arcachon
04-11-12, 21:42
http://www.youtube.com/watch?v=aqdY4HAXUQA

https://lh4.googleusercontent.com/-dEFvj2DJkhw/UJaAGklXcYI/AAAAAAAAJCE/TIxVM_YHXEs/s668/1352040471008.png

smpeh
04-11-12, 21:42
was looking at the strategy within the company regards lower cost product lines.

Actually IBM is manufacturing here in Singapore for some of their products. From my view is all about taxes, governement grants and country's skilled workforce. However the plant here was decided after intense competition from several countries for their dollar. That was a very intense process.

Hopefully our EDB will be more aggressive in maintaining that edge otherwise iskandar will take away a lot of our mother ants.

Arcachon
04-11-12, 21:49
Actually IBM is manufacturing here in Singapore for some of their products. From my view is all about taxes, governement grants and country's skilled workforce. However the plant here was decided after intense competition from several countries for their dollar. That was a very intense process.

Hopefully our EDB will be more aggressive in maintaining that edge otherwise iskandar will take away a lot of our mother ants.

Try to think of manufacturing without the factory instead.

smpeh
04-11-12, 22:04
Try to think of manufacturing without the factory instead.

As u mentioned what US has been doing, but those guys supporting manufacturing will suffer. Manufacturing support if I remember support the 2nd most jobs in singpaore. So hope we can still work on that. Not all people can go to services, bio, chemical....

smpeh
04-11-12, 22:17
Try to think of manufacturing without the factory instead.

Arcachon, side track a bit, heard u are in France now, wish to come next weekend, is it a good time? If can pm me cos first time going paris. thanks!

Arcachon
04-11-12, 22:55
Arcachon, side track a bit, heard u are in France now, wish to come next weekend, is it a good time? If can pm me cos first time going paris. thanks!

Depend on what you like. If you like wet and cold next week is the best lot of rain and cold.

Best time to travel is still in Spring.

http://fr.weather.com/weather/10day-Paris-FRXX0076

Shanhz
05-11-12, 05:06
Thank you for your comments. You have pointed out the most important thing to consider.

My situation is like this:- We are now staying in an HDB EM and will not consider anything smaller than that. We spend money to upgrade and not to downgrade. Since new condos built these years are usually very small, we need at least a 4-bedder (we have two kids and need a not-so-small study). On the current market, an average 4-bedder costs around 2m (not those in the suburbs - again, we want to upgrade in terms of location too), and some clusters cost slightly more than 2m, in which case I think the latter is more value for money.

My humble and honest opinion for your comments, please.

if u are selling your EM to upgrade, i suggest buying another house for passive income rather than work your whole life for one house.

wind30
05-11-12, 05:43
if u are selling your EM to upgrade, i suggest buying another house for passive income rather than work your whole life for one house.

See. All this passive income thinking at today's prices only work at 1 percent interest rates. You think these people will hold at 5 percent interests??

chestnut
05-11-12, 05:53
See. All this passive income thinking at today's prices only work at 1 percent interest rates. You think these people will hold at 5 percent interests??

Wind30, u so cute. I really hope u get your dream house when interest rate hits 5%. What if interest rate hits 5% when u are 50? Then I really hope u have saved enough money. Hey u don't need to save a lot. Prices would have dropped when interest rate hit 5%.

So come to think of it, when interest rate at 5%, prices will drop, so I don't really need to save money. Why? Because all CMs would be removed. I still can buy? Good one.

Wind30, after all the analysis, I still don't buy your story. But I have created a scenario based on your theory to assist u in your planning. Please amend or correct the theory.

;) ;)

heehee
05-11-12, 06:54
Interest rate if at 5% means rental yield will go up to 8%? Not much difference from interest rate 1% & rental yield 3% wah? :p
Anyway, with so much money printing, IMHO, difficult for interest rate to go up above 3% in next 10 years.


See. All this passive income thinking at today's prices only work at 1 percent interest rates. You think these people will hold at 5 percent interests??

chestnut
05-11-12, 07:19
Interest rate if at 5% means rental yield will go up to 8%? Not much difference from interest rate 1% & rental yield 3% wah? :p
Anyway, with so much money printing, IMHO, difficult for interest rate to go up above 3% in next 10 years.
Bro, if 10 years, he can save 50k a year or more. So in 10 yrs, he pay cash.

Mary Lee
05-11-12, 07:26
if u are selling your EM to upgrade, i suggest buying another house for passive income rather than work your whole life for one house.


Thanks. Will do that.

kane
05-11-12, 07:38
Some projects, after 40% down, the current rental can still fully cover the instalments based on future interest rate of 5%, gross before taxes. I think we might get to 4% some day but i don't think we'll see 5%.

Shanhz
05-11-12, 08:01
See. All this passive income thinking at today's prices only work at 1 percent interest rates. You think these people will hold at 5 percent interests??

pple who buy ppty hoping that it will give a higher yield than the bank are short term investors. the irony is that when interest hits 5% and you want to switch back to bank deposits (or equivalent), the housing situation (price/demand etc) may not allow you to. or you may be forced to sell at a lower price.

there are too many variables to ppty investment and everybody's circumstances are different. for me, my personal view is to hold in the middle to long term, let the rental pay for the house (if necessary, top up with some cash) and 30 yrs later you get a free house.

property is amongst the better and easier ways to beat inflation (i'm not saying the best way). when i plan my investments, i flex the interest rates up to 4% to ensure i can pay for the instalments at that kind of rates.

this is just my personal view. there are many others views and i respect all of them.

Laguna
05-11-12, 08:28
Perhaps let me share my :2cents: in interest rate. I am not an economist, just a layman / laywoman's view.

Why interest rate goes up? Some of the main reasons are :
1. tight credit during economy expansion
2. high inflation
3. change in monetary reserve requirement due to over-heating
4. central bank policy.

Next we examine the foreign reserve of Singapore.
http://www.mas.gov.sg/Statistics/Reserve-Statistics/Official-Foreign-Reserves.aspx
Without much of breakdown, my :2cents: told me that main currency in our foreign reserve is in US$, those with IMF and gold is for sure. US$ is still the world currency.

Will Singapore Interest rate goes up?
the answer is definitely YES as we are now almost at all time low, cannot be much lower, the only way is sideway or up. But longer term is definitely up. When and How much are the questions to be answered.

When Singapore Interest Rate will go up?
No one know. But MAS in the last two years, is allowing S$ to appreciate and keep interest rate low to fight inflation. Strong S$ hurts our export badly. Even with that in mind, why MAS still prefer stronger S$ than higher interest rate? The only reason I have is, with such low interest rate, S$ is already so strong, if S$ interest rate goes up, our S$ is going to be much stronger and attracting even more hot money which Sg Govt does not want.

On top of that, Sg is earning peanut interest from US$ reserve, so, look at the latest HDB bond, that is the rate Sg Govt willing to pay.

We can afford to have very low bond yield for the Govt Securities as Sg is being graded as AAA.

Next US$ interest rate.
US debt now is running at US$16.3T, some of the US 30 years treasury was issued at 7% years back. The ghost bro sent a link that US Govt is paying US$4b daily on interest. My calculation is around US$2.6B daily. So, does US Govt has the money to pay more interest if rate goes up?

US is now printing themselves out of debt and recession. So does ECB and BOJ.

Stop writing here.

roly8
05-11-12, 08:59
pple who buy ppty hoping that it will give a higher yield than the bank are short term investors. the irony is that when interest hits 5% and you want to switch back to bank deposits (or equivalent), the housing situation (price/demand etc) may not allow you to. or you may be forced to sell at a lower price.

there are too many variables to ppty investment and everybody's circumstances are different. for me, my personal view is to hold in the middle to long term, let the rental pay for the house (if necessary, top up with some cash) and 30 yrs later you get a free house.

property is amongst the better and easier ways to beat inflation (i'm not saying the best way). when i plan my investments, i flex the interest rates up to 4% to ensure i can pay for the instalments at that kind of rates.

this is just my personal view. there are many others views and i respect all of them.

thx for sharing, bro!
:cheers5:

Lovelle
05-11-12, 09:13
Disagree. First, the reason iteelf is multitude, you can find enough posts here about the under built HDB story and immigration story. 0 interest is just part of it.

2nd, it is natural for asset price to rise when value of money drops. Cheap money creates inflation, but inflation is sticky. After x yrs of inflation, let say monetary policy tightened, inflation drops, do you expect consumable prices to *drop* ? That is akin to expect $2 chicken price will come back. No, inflation is sticky by nature.

3rd, now we all know it will take a long time before the world can see high interest, is this 5y window an opportunity ? especially for the young, do you expect your earning capacity remain the same 5yrs later ?

4th, I applaud MAS for doing its job to make sure what you fear do not happen. This was not the case in Spain or US housing bubble. Today, 60% or less LTV with 20y tenor , 4y "holding period", greatly reduces the system risk.

this is exactly what i think. From 2006 onwards, there is a saying that America is going into a loss decade. It mean it will take at least 10 yrs for it to revived itself fr all the war that caused economy destruction. That also means 10 yrs of low interest from 2007 - 2017....

in Japan it is taking longer then 10 yrs now. So do u think interest rate will go up ?

Rysk
05-11-12, 09:17
Perhaps let me share my :2cents: in interest rate. I am not an economist, just a layman / laywoman's view.

Why interest rate goes up? Some of the main reasons are :
1. tight credit during economy expansion
2. high inflation
3. change in monetary reserve requirement due to over-heating
4. central bank policy.

Next we examine the foreign reserve of Singapore.
http://www.mas.gov.sg/Statistics/Reserve-Statistics/Official-Foreign-Reserves.aspx
Without much of breakdown, my :2cents: told me that main currency in our foreign reserve is in US$, those with IMF and gold is for sure. US$ is still the world currency.

Will Singapore Interest rate goes up?
the answer is definitely YES as we are now almost at all time low, cannot be much lower, the only way is sideway or up. But longer term is definitely up. When and How much are the questions to be answered.

When Singapore Interest Rate will go up?
No one know. But MAS in the last two years, is allowing S$ to appreciate and keep interest rate low to fight inflation. Strong S$ hurts our export badly. Even with that in mind, why MAS still prefer stronger S$ than higher interest rate? The only reason I have is, with such low interest rate, S$ is already so strong, if S$ interest rate goes up, our S$ is going to be much stronger and attracting even more hot money which Sg Govt does not want.

On top of that, Sg is earning peanut interest from US$ reserve, so, look at the latest HDB bond, that is the rate Sg Govt willing to pay.

We can afford to have very low bond yield for the Govt Securities as Sg is being graded as AAA.

Next US$ interest rate.
US debt now is running at US$16.3T, some of the US 30 years treasury was issued at 7% years back. The ghost bro sent a link that US Govt is paying US$4b daily on interest. My calculation is around US$2.6B daily. So, does US Govt has the money to pay more interest if rate goes up?

US is now printing themselves out of debt and recession. So does ECB and BOJ.

Stop writing here.

Even through is layman's term, but is simple & good enough to understand.. at least for me :cheers5:

gn108
05-11-12, 09:17
I share your view on using circa 4% mortgage rate.
I also agree on the 'free' house concept and best forced saving class.

But as with all investments, properties move in cycles - so if your're able to be multi-class observant, you can increase your gains.



pple who buy ppty hoping that it will give a higher yield than the bank are short term investors. the irony is that when interest hits 5% and you want to switch back to bank deposits (or equivalent), the housing situation (price/demand etc) may not allow you to. or you may be forced to sell at a lower price.

there are too many variables to ppty investment and everybody's circumstances are different. for me, my personal view is to hold in the middle to long term, let the rental pay for the house (if necessary, top up with some cash) and 30 yrs later you get a free house.

property is amongst the better and easier ways to beat inflation (i'm not saying the best way). when i plan my investments, i flex the interest rates up to 4% to ensure i can pay for the instalments at that kind of rates.

this is just my personal view. there are many others views and i respect all of them.

kane
05-11-12, 12:04
The volatility in some asset classes have resulted in the unsavvy investors making some sub optimal decisions.

chestnut
05-11-12, 12:24
The volatility in some asset classes have resulted in the unsavvy investors making some sub optimal decisions.

Bro, it is when this people go in that the prices start to shoot up. So for u, when to get out is the key, better early than late. But please don't get out too early ok.

whoh757
05-11-12, 12:39
Even through is layman's term, but is simple & good enough to understand.. at least for me :cheers5:

second that, good piece. precluding a black swan event which Will come. key thing is your own mindset: trading a pty or investing in one. If its the latter, try to your best ability and calculation, to hold. :scared-5:

Shanhz
05-11-12, 19:34
I share your view on using circa 4% mortgage rate.
I also agree on the 'free' house concept and best forced saving class.

But as with all investments, properties move in cycles - so if your're able to be multi-class observant, you can increase your gains.

Absolutely right. It depends how greedy u r. Follow the slow and steady, you only have 2-3 properties by the time you are old.

Time the market correctly and you may end up with 5 or more. Or, maybe less due to bad timing. You may sell out too early. Or hold on too late.

Both are not wrong methods. End of the day, it is the risk appetite of each individual.

speculator
05-11-12, 20:50
In the past, the normal interest rate was about 4% and property prices rise and fall according to economic cycle and property cycle.

The last four years, interest rate has been about 1% which is not normal. This has induced a lot more vulnerable people into the property market. Should interest rate goes back to normal, a lot more people will have to exit the market at the same time causing downward price pressure in the short to medium term.


lots of people still dreaming about high interest rate. low interest is here to stay for a very long time with QE4 probably in the pipeline already

speculator
05-11-12, 21:00
http://mistymoon.com.sg/img/Property/Screen%20shot%202012-11-04%20at%20PM%2003.39.41.png

http://mistymoon.com.sg/img/Property/Screen%20shot%202012-11-04%20at%20PM%2003.32.29.png

No doubt, but you did not mention anything about holding power. Perhaps not everyone here is as able to withstand downturns as you?

Please throw all these charts away. In the past decades, is there such a thing call QE, Asset Purchase Program, LTRO?

in analogy; it's stupid walking forward with your head looking backwards

AKvins
05-11-12, 21:18
Wonderful history lesson. Thanks for the summary of policy changes and price movements.

kane
05-11-12, 21:26
US did some monetary easing in the early 90s during the S&L crisis. Japan has been maintaining easy monetary policy for a very long while. but yes, the world hasn't this kinda of monetary easing of this scale ever.

Paulder
05-11-12, 22:56
Hope you are right.


Please throw all these charts away. In the past decades, is there such a thing call QE, Asset Purchase Program, LTRO?

in analogy; it's stupid walking forward with your head looking backwards

carbuncle
06-11-12, 00:13
Please throw all these charts away. In the past decades, is there such a thing call QE, Asset Purchase Program, LTRO?

in analogy; it's stupid walking forward with your head looking backwards

I sincerely thank you for the wake up call. But alas.... your nick also speaks volume...

speculator
07-11-12, 22:10
I sincerely thank you for the wake up call. But alas.... your nick also speaks volume...


Obama won, Gold shot up. Go figure out yourself and don't be another Mr B :banghead:

Secretariat
08-11-12, 09:45
(Maybe none of you have seen this news)

For the full week, PBOC has made a net injection of RMB379 billion, a new record high net injection for the single week, suggesting that liquidity condition remains tight and unstable in China.

http://www.alsosprachanalyst.com/economy/peoples-bank-of-china-injects-rmb173-billion-of-liquidity-via-open-market-operation.html

roly8
08-11-12, 10:05
(Maybe none of you have seen this news)

For the full week, PBOC has made a net injection of RMB379 billion, a new record high net injection for the single week, suggesting that liquidity condition remains tight and unstable in China.

http://www.alsosprachanalyst.com/economy/peoples-bank-of-china-injects-rmb173-billion-of-liquidity-via-open-market-operation.html

wa..china still need to inject $$ ah?
thought they are Huat-ing like siao :o

lajia
08-11-12, 17:16
You are right lah.

I think it is good for retirement or for those who work in the west, like NTU, and have enough patience to wait for everything in Jurong to be up.

Developer sale at around $500 psf. Is this the lowest psf price for a new home nowadays?

Have u find anything lower than that? This development is 5 min drive away from the up coming JLD, 3 or 4 bus top away from Jurong Point...this price is history now I think. :o :2cents:

Mary Lee
08-11-12, 18:37
Have u find anything lower than that? This development is 5 min drive away from the up coming JLD, 3 or 4 bus top away from Jurong Point...this price is history now I think. :o :2cents:

Thanks for the additonal information. This is the cheapest I have found so far, but it looks that it's fully sold out.