View Full Version : Car Loan impact on Property
As a 5Cs nation, I have this feeling that the recent measures on car loan will have a very significant impact on property market because potential upgraders might have to postpone their property purchase in order to fulfill the down payment for their car purchase.
As a 5Cs nation, I have this feeling that the recent measures on car loan will have a very significant impact on property market because potential upgraders might have to postpone their property purchase in order to fulfill the down payment for their car purchase.
that will be pretty silly of them to focus on a depreciating asset first rather than an appreciating asset. but that's vanity for some.
that will be pretty silly of them to focus on a depreciating asset first rather than an appreciating asset. but that's vanity for some.
very hard to say, when people get used to certain lifestyle it will be very difficult for them to lose it, especially when they dont want to be seen down grading from say a bimmer to a Hyundai because they cant afford the down payment.
very hard to say, when people get used to certain lifestyle it will be very difficult for them to lose it, especially when they dont want to be seen down grading from say a bimmer to a Hyundai because they cant afford the down payment.
they can continue to drive a beemer till scrap lor. if not buy a second hand one but maybe bigger cc to try and gain more "face" value if they are that vain. lol.
As a 5Cs nation, I have this feeling that the recent measures on car loan will have a very significant impact on property market because potential upgraders might have to postpone their property purchase in order to fulfill the down payment for their car purchase.
Another channel of impact is that potential car buyers give up idea of owning a car, which is a liability. Save bullet to buy condo near mrt. Between owning an asset and a liability, many may choose the former. Of course those condos not near any mrt jialat.
if 50% down for those nice car, i might as well put down for a small condo unit.
Some will buy the car first because the COE bubble is busting.
Property will likely sideway and will take a longer time to correct. So no hurry to buy property right now.
Another channel of impact is that potential car buyers give up idea of owning a car, which is a liability. Save bullet to buy condo near mrt. Between owning an asset and a liability, many may choose the former. Of course those condos not near any mrt jialat.
Cannot afford even a car, can buy Condo near MRT meh?
if 50% down for those nice car, i might as well put down for a small condo unit.
And pay 7% ABSD?...
I think the reverse is true... the policy makers suspect that the CM measures for housing has gotten many stuck with cash. The potential for dumping it in a car is very high. This can only drive up the COE... hence the CM for cars.
If the discount by the developers are seriously good. Then I guess why not?
As a 5Cs nation, I have this feeling that the recent measures on car loan will have a very significant impact on property market because potential upgraders might have to postpone their property purchase in order to fulfill the down payment for their car purchase.
Fully agree with your feeling, I have the same feeling in 2006. After returning from 30 months stay in US, almost all of them go and buy a car. Some of them even ask me why I did not buy a car and still take BMW (Bus MRT Walk). I told them I can't afford but did not tell them I just brought a 2 Bedroom for SGD 535000 and down 20%. A week after I brought the 2 Bedroom, an agent ask me if I am interested to sell. I told her a Toyota Wish will do, lucky the buyer did not offer me the Toyota Wish.
Stay away from car market first.. When prices re-stabilize, many people will realize gahmen has done an awesome job bringing the car mkt down..
In turn this makes it more affordable for ppl to purchase cars again but, But, BUT.. Many of us too impatient only want to see quick results..
So can't appreciate what gahmen does and only want to get quick fix and buy car asap.. Haiz when will ppl learn ya?
:) hehehe
Stay away from car market first.. When prices re-stabilize, many people will realize gahmen has done an awesome job bringing the car mkt down..
In turn this makes it more affordable for ppl to purchase cars again but, But, BUT.. Many of us too impatient only want to see quick results..
So can't appreciate what gahmen does and only want to get quick fix and buy car asap.. Haiz when will ppl learn ya?
:) hehehe
regardless of COE price, buying cars luxury car now will require alot more cash upfront than before, so for those who have limited budget thinking o buying 2nd or 3rd property will have to choose between putting the money in the car and postpone the property purchase or put the money in property and take public transport.
If we use our head, of course we will buy a property, but something people do follow their hearts more than their mind.
Actually it's the other way round for me.... Already game over for property purchase... So saving up for car instead.:D
50% down for car, 100k for a 200k car, can't get any property for 100k with all the CMs... Last time still got chance...:(
Actually it's the other way round for me.... Already game over for property purchase... So saving up for car instead.:D
50% down for car, 100k for a 200k car, can't get any property for 100k with all the CMs... Last time still got chance...:(
Cars is the 2nd biggest ticket items in the list of must have for more Singaporeans. I think it will be very difficult to convince them not to own a car and just take public transport.
Personal experience: it really takes a lot of mental discipline and cooperation within the family to not have a car when you have a new born. We thought we could do it as well but with more frequent quarrels and at time pure inconvenience even when trying to call a cab on Friday or weekend evenings and no one wants to pick up really takes the cake and eventually got a small car.
The government intention behind this car cooling measure might be well founded - but the general blunt approach adopted to apply to all Singaporeans without sparing a thought for a more nuanced approach, made by scholars at their ivory tower - really created more hardships for their middle or sandwiched families which formed the bulk of citizenship in Singapore
UltimateAro888
03-03-13, 09:49
Another channel of impact is that potential car buyers give up idea of owning a car, which is a liability. Save bullet to buy condo near mrt. Between owning an asset and a liability, many may choose the former. Of course those condos not near any mrt jialat.
I tend to agree with you. That why garments mentioned that by 2030 most household should be within x distance from a nearby mrt, etc.. the increase mrt coverage is to address those moving ppl from buying a car.
The only thing is instead of chasing after house near mrt, perhaps wait for method time be built near your place..
I tend to agree with you. That why garments mentioned that by 2030 most household should be within x distance from a nearby mrt, etc.. the increase mrt coverage is to address those moving ppl from buying a car.
The only thing is instead of chasing after house near mrt, perhaps wait for method time be built near your place..
couples with new born now, will find that their kids would have reached tertiary education by the time the full transport network is ready. but at least we're making a start. no overnight solution for infrastructure i guess.
Wait till there are elderly parents at home who are physically challenged. Worst than having baby. SMEs who needs vehicle to operate their businesses is another problem otherwise cost will pass down to consumers. Garment has to really deliberate on this issue next week.
Personal experience: it really takes a lot of mental discipline and cooperation within the family to not have a car when you have a new born. We thought we could do it as well but with more frequent quarrels and at time pure inconvenience even when trying to call a cab on Friday or weekend evenings and no one wants to pick up really takes the cake and eventually got a small car.
The government intention behind this car cooling measure might be well founded - but the general blunt approach adopted to apply to all Singaporeans without sparing a thought for a more nuanced approach, made by scholars at their ivory tower - really created more hardships for their middle or sandwiched families which formed the bulk of citizenship in Singapore
Wild Falcon
03-03-13, 10:42
Why would car loan affect property? Lots of people take minimal loan for cars in the first place.
As a 5Cs nation, I have this feeling that the recent measures on car loan will have a very significant impact on property market because potential upgraders might have to postpone their property purchase in order to fulfill the down payment for their car purchase.
The problem today is ppl tend to complain about what they want and not what they need...cannot get new car if really need a car, then get a old one. Brand new car cost 120k but a eight yr old car cost say 25k with much lower depreciation...Cannot afford a BMW then get a Toyota or Hyundai. Things can be work out but thinking that it is garmen faults will not help, and this is the prob today, why should garmen think about the first timer who really needs a car?? There are more pressing important issues to settle...What is needs and what is wants I think ppl have forgotten., there is a hokkien saying, 饿饱吵, hungry make noise, full also make noise!...:2cents: :D
Personal experience: it really takes a lot of mental discipline and cooperation within the family to not have a car when you have a new born. We thought we could do it as well but with more frequent quarrels and at time pure inconvenience even when trying to call a cab on Friday or weekend evenings and no one wants to pick up really takes the cake and eventually got a small car.
The government intention behind this car cooling measure might be well founded - but the general blunt approach adopted to apply to all Singaporeans without sparing a thought for a more nuanced approach, made by scholars at their ivory tower - really created more hardships for their middle or sandwiched families which formed the bulk of citizenship in Singapore
Young execs expect that they should be able to afford a beemer perhaps.
They rather splurge on the car for face value than save up for a house.
Young execs expect that they should be able to afford a beemer perhaps.
They rather splurge on the car for face value than save up for a house.
Wish to been seen as "the rich and the famous" gen
The problem today is ppl tend to complain about what they want and not what they need...cannot get new car if really need a car, then get a old one. Brand new car cost 120k but a eight yr old car cost say 25k with much lower depreciation...Cannot afford a BMW then get a Toyota or Hyundai. Things can be work out but thinking that it is garmen faults will not help, and this is the prob today, why should garmen think about the first timer who really needs a car?? There are more pressing important issues to settle...What is needs and what is wants I think ppl have forgotten., there is a hokkien saying, 饿饱吵, hungry make noise, full also make noise!...:2cents: :D
Dun think pple are expecting the garment to help them to get a car .... any notion of this nature is definitely misguided. What I am driving at is that the approach seems to be more of a "shock theory" than anything.
https://photos-5.dropbox.com/t/0/AADVSb4qgpJ4wO8bKIptC0-H7LvMzc4Alt87LeCk1JVPXw/12/10696851/jpeg/32x32/6/_/1/2/2012-01-28%2011.28.37.jpg/BPlJqh3grzHbXCPwwgYphVp0qmsARV9MS9KBKa-GaVs?size=1024x768&size_mode=2
http://www.leboncoin.fr/voitures/401123611.htm?ca=2_s
http://www.leboncoin.fr/voitures/offres/aquitaine/?f=a&th=1&q=bmw&location=33260
Wish to been seen as "the rich and the famous" gen
it will be their own undoing. young ones need to plan carefully their finances for their first house. otherwise, it'll only get further and further away from them.
All in all.. Stay away from car market, be patient and you will see the prices drop.. Buy when the price makes more sense lah. Alamak..sibei kiasee always scared ppl buy more car than you.. Say only the rich wil buy lah.. Car price won't drop coz the rich will keep buying lah.. Kanasai it's the people with no $ but keep buy buy buy that caused car price to keep going up..
I was at 2nd hand car dealer recently and I saw Merz e250 just 8 mths old 2012 registration but already end up in dealer. Make a guess what happened to the car?
Kns.. Without proper finance planning, even buying a plate of rice is a bubble!!!
Never pay more than what you can't afford my friends
Personal experience: it really takes a lot of mental discipline and cooperation within the family to not have a car when you have a new born. We thought we could do it as well but with more frequent quarrels and at time pure inconvenience even when trying to call a cab on Friday or weekend evenings and no one wants to pick up really takes the cake and eventually got a small car.
The government intention behind this car cooling measure might be well founded - but the general blunt approach adopted to apply to all Singaporeans without sparing a thought for a more nuanced approach, made by scholars at their ivory tower - really created more hardships for their middle or sandwiched families which formed the bulk of citizenship in Singapore
bro, a good car and a decent car - two very different things. if you now have a new born, you can throw 150k to get a VW jetta (oops).
alternatively, you can throw 30k to get a 7yr old altis.
outcome is the same, granted safety level higher for the jetta. dun even tell me the altis got more maintenance prob. if you get one with genuine mileage and well maintained, likelihood is you will visit workshop less on that altis.
doesn't it then boil down to expectations? strawberry generation have too high expectations that does not commensurate with their current position in society.
I was at 2nd hand car dealer recently and I saw Merz e250 just 8 mths old 2012 registration but already end up in dealer. Make a guess what happened to the car?
quite possible that he traded up for a newer car. the COE bubble has fueled "free car upgrade" for the last 2-3 yrs now. just dun be the last man standing when it crashes.
if holding ppty, still can earn rental (high or low nvm). and it wun depreciate. holding a car that you can't sell is another story. :doh:
Why would car loan affect property? Lots of people take minimal loan for cars in the first place.
I think u are right for last year when COE is high. Last time when COE is low, many marginal car buyers take 80-90% or even $0 driveaway scheme at one stage.
quite possible that he traded up for a newer car. the COE bubble has fueled "free car upgrade" for the last 2-3 yrs now. just dun be the last man standing when it crashes.
if holding ppty, still can earn rental (high or low nvm). and it wun depreciate. holding a car that you can't sell is another story. :doh:
For property, it is not 100% truth too if u look at Japan. 99lh properties do depreciate at certain point of time.
bro, a good car and a decent car - two very different things. if you now have a new born, you can throw 150k to get a VW jetta (oops).
alternatively, you can throw 30k to get a 7yr old altis.
outcome is the same, granted safety level higher for the jetta. dun even tell me the altis got more maintenance prob. if you get one with genuine mileage and well maintained, likelihood is you will visit workshop less on that altis.
doesn't it then boil down to expectations? strawberry generation have too high expectations that does not commensurate with their current position in society.
Yes. I have been telling my relatives not to commit brand new car for the past year. I told them to find a 5yo car at around 50k. COE will definitely drop one day and it is happening sooner than i thought.
Why do we need loans and installments to pay for cars, furniture, electrical appliances and overseas holidays?
These are depreciating liabilities or expense items that should be paid 100% in cash durng the time of purchase.
All these modern payment methods only benefit the banks and the companies. Their pool of consumers is much bigger by selling to buyers who can't afford them in the first place. With the interests, these people end up paying more for products they don't really need.
Cars are depreciating liabilities. They start depreciating the moment you drive them down the road. The loan payment, servicing and maintenance costs make them liabilities.
Properties can be assets or liabilities. It depends when and what price you buy.
If the price keeps appreciating over the years, or continues to provide you a passive income, it's an asset. When you can't generate a positive flow, it's a liability. Once the outstanding loan is higher than the market value, it's a negative asset.
quite possible that he traded up for a newer car. the COE bubble has fueled "free car upgrade" for the last 2-3 yrs now. just dun be the last man standing when it crashes.
if holding ppty, still can earn rental (high or low nvm). and it wun depreciate. holding a car that you can't sell is another story. :doh:
The owner sold.. Can't afford installment
bro, a good car and a decent car - two very different things. if you now have a new born, you can throw 150k to get a VW jetta (oops).
alternatively, you can throw 30k to get a 7yr old altis.
outcome is the same, granted safety level higher for the jetta. dun even tell me the altis got more maintenance prob. if you get one with genuine mileage and well maintained, likelihood is you will visit workshop less on that altis.
doesn't it then boil down to expectations? strawberry generation have too high expectations that does not commensurate with their current position in society.
dun think my point was on whether its a good car versus a decent car debate resulting from the car cooling measure leh.
My case I was fortunate as I had the option of either putting in a downpayment or to do a loan for max duration. Although at the end of the day i chose to place a substantial downpayment and its for a small Jap car for basic tpt needs.
I am saying that the latest measure deprives pple of even that option of choosing instead, and the government thus decides for them in the name of exercising financial prudence.
Factually this inevitably results in pple having less options and more difficulties in getting a car across the board - whether it be a small jap car like mine or a conti fancy car.
This is what I think most pple are unhappy about. They are not unhappy because now they cannot buy their BMW or Mercedes to hao lian, but having that basic option to finance being taken away from them. Why should the government decide for them what is essentially a very private financial arrangement - after all, such car loans are secured albeit a depreciating assets and they are fully aware of the drastic consequences of not being able to service the car loan installments.
Cars are depreciating liabilities. They start depreciating the moment you drive them down the road. The loan payment, servicing and maintenance costs make them liabilities.
Properties can be assets or liabilities. It depends when and what price you buy.
If the price keeps appreciating over the years, or continues to provide you a passive income, it's an asset. When you can't generate a positive flow, it's a liability. Once the outstanding loan is higher than the market value, it's a negative asset.
very true. Have to keep reminding myself not to be tempted to the dark side by speeding Continental cars while driving in my reliable and trusty Honda heh :o
Why do we need loans and installments to pay for cars, furniture, electrical appliances and overseas holidays?
These are depreciating liabilities or expense items that should be paid 100% in cash durng the time of purchase.
All these modern payment methods only benefit the banks and the companies. Their pool of consumers is much bigger by selling to buyers who can't afford them in the first place. With the interests, these people end up paying more for products they don't really need.
This is true - but its just providing added options for pple to manage their risks portfolio. Some pple might well want to service car installments instead of making lump sum downpayments + having the cash on hand as buffer in case where they can spot a choice property to invest upon. No right or wrong in this.
If they play it too high up and get over-leverage they will have to live with the consequences. But from a principle standpoint - I do not see the rationale (if any) of depriving pple of this optionality since the move for this does not appear to be well explained by the incumbent government when this is rolled out though.
Then again this could be just me. :confused:
dun think my point was on whether its a good car versus a decent car debate resulting from the car cooling measure leh.
My case I was fortunate as I had the option of either putting in a downpayment or to do a loan for max duration. Although at the end of the day i chose to place a substantial downpayment and its for a small Jap car for basic tpt needs.
I am saying that the latest measure deprives pple of even that option of choosing instead, and the government thus decides for them in the name of exercising financial prudence.
Factually this inevitably results in pple having less options and more difficulties in getting a car across the board - whether it be a small jap car like mine or a conti fancy car.
This is what I think most pple are unhappy about. They are not unhappy because now they cannot buy their BMW or Mercedes to hao lian, but having that basic option to finance being taken away from them. Why should the government decide for them what is essentially a very private financial arrangement - after all, such car loans are secured albeit a depreciating assets and they are fully aware of the drastic consequences of not being able to service the car loan installments.
Seriously.. With car ownership prices going to 90k coe.. If left unattended don't you feel afraid that car ownership bubble may happen??
If a bubble does happen, and it bursts or causes many people to be caught. The implication will be more than just economic.. It actually shows a social problem because a lot of the current young people are not able to plan their own finances
A cheaper car price (and COE) will ultimately benefit Singaporeans as well as the small and medium enterprises that offer transportation and logistics service.
Imagine if a small mover company with expiring fleet of lorries.. If COE price is too high and they are unable to replace their lorries with newer ones and as a result need to close down or downsize, it means a loss of business for them. Ultimately the government is protecting the businesses as well as the private vehicle owners from financial ruin with this new CM.
I applaud the government's move to cool prices for car industry.
very true. Have to keep reminding myself not to be tempted to the dark side by speeding Continental cars while driving in my reliable and trusty Honda heh :o
the 2 common marques i see by the roadside with the bonnet flap or boot open is typically B** & A***
Seriously.. With car ownership prices going to 90k coe.. If left unattended don't you feel afraid that car ownership bubble may happen??
If a bubble does happen, and it bursts or causes many people to be caught. The implication will be more than just economic.. It actually shows a social problem because a lot of the current young people are not able to plan their own finances
A cheaper car price (and COE) will ultimately benefit Singaporeans as well as the small and medium enterprises that offer transportation and logistics service.
Imagine if a small mover company with expiring fleet of lorries.. If COE price is too high and they are unable to replace their lorries with newer ones and as a result need to close down or downsize, it means a loss of business for them. Ultimately the government is protecting the businesses as well as the private vehicle owners from financial ruin with this new CM.
I applaud the government's move to cool prices for car industry.
are commercial vehicles part of the measures as well? I thought not, but I could be wrong.
Cooling prices for the car industry is not a bad move. At the very least there should be more consideration and thought either in terms of explaining or consultation etc ... its another move akin to the white paper where the government thinks its best for us and then its out the next day. Would have thought that the government would want greater participation or engagement after what had occurred on the white paper front.
I do agree that the intentions behind this is well-founded. This (i hope) is just a works in progress and the government to look into early fine-tunings of this policy and not a case of "tap on" for a while then pple complain then become "tap off" in its entirety :doh:
the 2 common marques i see by the roadside with the bonnet flap or boot open is typically B** & A***
so not durable one meh? Although I have also personally seen a Mer^&%$ uplorry in flames at the causeway quite some time back also :scared-4:
As a 5Cs nation, I have this feeling that the recent measures on car loan will have a very significant impact on property market because potential upgraders might have to postpone their property purchase in order to fulfill the down payment for their car purchase.
I think should be the other way round. put down payment for house instead of a car. the 50% down is equal toa BTO 30% for 3 room flat. or 20% for a 5 bed room bto.
The 5 rm will be a good choice as it is scalable for a expanding family nucleas.
so not durable one meh? Although I have also personally seen a Mer^&%$ uplorry in flames at the causeway quite some time back also :scared-4:
Just my casual observations lah. Amongst the newer cars by the side. Was that a new merz?
WHOLE JAGUAR TO BE MADE IN INDIA
My Paper | Tuesday, Mar 5, 2013
MUMBAI, India - Jaguar Land Rover (JLR) currently assembles some cars in India with parts shipped from Britain. Manufacturing the whole car in India would make it cheaper, as it would save on government import taxes and labour costs.
"Like Brazil, India is one of the possibilities for Jaguar Land Rover to fully manufacture cars," a person close to the development told The Wall Street Journal on Sunday. However, he cautioned that the process was at a "very preliminary stage".
Tata Motors bought Jaguar and Land Rover from Ford Motor in 2008 for US$2.3 billion, as part of plans to expand its reach beyond Asia. The deal vaulted Tata Motors from a commercial- vehicle and small-car maker to a global player with luxury brands in its range of offerings.
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