View Full Version : MAS makes commentators look foolish again
https://www.propertysoul.com/2017/07/06/mas-makes-commentators-foolish/
MAS makes commentators look foolish again
July 6, 2017
https://i2.wp.com/www.propertysoul.com/wp-content/uploads/2017/07/MAS.jpg?resize=350%2C237&ssl=1
Last Thursday, Managing Director of Monetary Authority of Singapore (MAS) Ravi Menon mentioned at the annual report media conference that it is “not time yet to ease the cooling measures”, “they remain necessary” and “easing the measures now would send a wrong signal”.
Sorry, cooling measures are to stay
Menon cited two reasons for the decision: 1) Good pick-up of recent project launches under low interest rate environment; and 2) Increased tightening of property buying restrictions in other countries.
Menon emphasized that “property prices should be aligned with broader income trends in the economy and the government will not let “property prices increase faster than nominal GDP growth”.
Private residential property prices have climbed 60 percent over 17 quarters, but only declined less than 12 percent in the last 14 quarters.
Menon restated that MOF, MND, and MAS were all very clear in the March announcement that the adjustments “were made for very specific reasons and purposes” and the government has never changed its position on the TDSR structure, Additional Buyer’s Stamp Duty and Loan-to-Value limits.
“The calibrated adjustments by the government earlier this year do not signal the start of an unwinding of the property cooling measures, as some commentators have suggested.”
Oops, MAS just gave industry stakeholders who speculated further relaxation of cooling measures a real slap on the face!
The market tends to make us look foolish most of the time, isn’t it?
Those who recently bought on deferred payment scheme or stay-then-pay programme should now realize that the wait may not be just one to two years’ time.
Edmund Tie & Co told the media last month that one investor takes ABSD in buying properties as the COE in buying cars, if the government is not lifting ABSD.
What the investor fails to see is: All car owners have to pay COE to drive a car. But not all property owners have to pay ABSD to buy a home. It depends on when they buy it and whether they are buying their first property.
Next time when he is competing with other owners of similar units in the same project for tenants or buyers, he will realize that they are not competing on equal footings because of the ABSD he has paid.
Why some commentators still don’t get it?
In fact, the commentators are not being slapped once but again and again by the government.
Every time when there was market speculation on relaxation of the cooling measures, the government would not hesitate to come upfront and put it straight.
https://i0.wp.com/www.propertysoul.com/wp-content/uploads/2017/07/not_easing_cooling_measures.jpg?resize=563%2C530&ssl=1
A contrarian’s view? Who bothers?
You can’t blame industry stakeholders who assured you that the government will lift ABSD soon; or Morgan Stanley who predicted that Singapore property prices to double by 2030; or JLL who claimed that residential market will likely to recover by early 2018 – when home buyers are taking the plunge fearlessly; when new launch projects are selling like hot cakes; when developers are bidding hungrily for new sites like there’s no tomorrow.
All these analysts are predicting that the property market will recover any time soon. We haven’t seen such positive market sentiments for a long time.
Who bother to be a contrarian here?
I did have a few blog posts with a different view:
1) It’s not bottoming-out. It’s dead cat bounce. (https://www.propertysoul.com/2017/05/03/dead-cat-bounce/)
2) 3 reasons why adjustments to property measures is not a good sign (https://www.propertysoul.com/2017/03/14/adjustments-to-property-measures/)
3) Who said property cooling measures may never be lifted? (https://www.propertysoul.com/2016/07/04/cooling-measures-never-be-lifted/)
I am not saying that the property market will crash soon. I just believe that the market is going to be different from what the local media and industry stakeholders are predicting.
Ken Fisher said in his book Beat the Crowd that a contrarian doesn’t have to hold an “opposite view” from the majority. A contrarian just holds a “different view”. If most people believe that this is what‘s going to happen in the market, the contrarian simply believes that something else will.
History tells us that the market likes to make most of us look foolish most of the time. It always gives us an anti-climax at the maximum point of optimism.
“The contrarian looks for things the herd and curmudgeons ignore – they branch out. Or they look at the same things but see them differently. Both actions let them find the risks and opportunities most others miss.”
“A 60% or 70% success rate keeps you well ahead of most … if you’re right 70% of the time in this realm, you become an absolute living legend.”
You see, I am only targeting 60 percent or at most 70 percent of the time to be right. I said it about Iskandar and Malaysia properties 3 years ago in 2014 (https://www.propertysoul.com/2014/09/26/tough-times-ahead-for-iskandar-and-malaysia-properties/). I said it about market slowdown and some other things as well. It’s not too difficult to be 60 to 70 percent of the time correct, isn’t it?
tonymontana
06-07-17, 21:16
More fanciful stories and conjecture from propsoul.
Everyone knows ABSD is here to stay, no surprises there.
There is no slapping going on, either by MAS or any other govt body.
They are saying it because market is picking up: they definitely cannot say or hint ABSD may be removed (it won't).
Getting it right, Iskandar - anybody could 've guessed it in 2014.
Why should they remove ABSD when it is big fat cash cow that people willing pay???????
They already have to have thick skin to increase prices/tariffs of car park, conservatory charges, rubbish charges, property taxes, water, soon electricity (due to carbon tariffs), soon possibly transport too? What else can they raise to increase their revenue?????????
Oh yah, heard they are going to cut Universities and ASTAR budget by 30% next year too?
Any other statutory boards also facing budget cut?
Heard coffeeshop talk asking why Government seems to be so short of money????? :dejection:
More fanciful stories and conjecture from propsoul.
Everyone knows ABSD is here to stay, no surprises there.
There is no slapping going on, either by MAS or any other govt body.
They are saying it because market is picking up: they definitely cannot say or hint ABSD may be removed (it won't).
Getting it right, Iskandar - anybody could 've guessed it in 2014.
Why should they remove ABSD when it is big fat cash cow that people willing pay???????
They already have to have thick skin to increase prices/tariffs of car park, conservatory charges, rubbish charges, property taxes, water, soon electricity (due to carbon tariffs), soon possibly transport too? What else can they raise to increase their revenue?????????
Oh yah, heard they are going to cut Universities and ASTAR budget by 30% next year too?
Any other statutory boards also facing budget cut?
Heard coffeeshop talk asking why Government seems to be so short of money????? :dejection:
If they know how HDB get their money to build HDB, they will not say Government seems to be short of money.
tonymontana
07-07-17, 09:23
Why should they remove ABSD when it is big fat cash cow that people willing pay???????
They already have to have thick skin to increase prices/tariffs of car park, conservatory charges, rubbish charges, property taxes, water, soon electricity (due to carbon tariffs), soon possibly transport too? What else can they raise to increase their revenue?????????
Oh yah, heard they are going to cut Universities and ASTAR budget by 30% next year too?
Any other statutory boards also facing budget cut?
Heard coffeeshop talk asking why Government seems to be so short of money????? :dejection:
Yes, I'm saying they won't remove ABSD anytime soon. TDSR is here to stay. ASTAR budget should be cut, less wastage of taxpayers' monies.
ABSD almost = COE. It only applies to spare properties or investment property purchases.
If one wants to rent out or invest in a property, ABSD becomes inevitable unless it's first property. If want to avoid ABSD must sell previous property so that group is buying for own stay and can't easily profit from it. Not so easy to sell.
Yes, MAS does make those who sold out at little or negative profits look foolish.
The demand can only grow. When will there ever be the excuse to remove ABSD?
And universities' budget are also cut 30% because they are wasting tax-payers monies? :hororr:
Yes, I'm saying they won't remove ABSD anytime soon. TDSR is here to stay. ASTAR budget should be cut, less wastage of taxpayers' monies.
Why should they remove ABSD when it is big fat cash cow that people willing pay???????
They already have to have thick skin to increase prices/tariffs of car park, conservatory charges, rubbish charges, property taxes, water, soon electricity (due to carbon tariffs), soon possibly transport too? What else can they raise to increase their revenue?????????
Oh yah, heard they are going to cut Universities and ASTAR budget by 30% next year too?
Any other statutory boards also facing budget cut?
Heard coffeeshop talk asking why Government seems to be so short of money????? :dejection:
anythingwhatever
07-07-17, 12:24
ABSD almost = COE. It only applies to spare properties or investment property purchases.
If one wants to rent out or invest in a property, ABSD becomes inevitable unless it's first property. If want to avoid ABSD must sell previous property so that group is buying for own stay and can't easily profit from it. Not so easy to sell.
Yes, MAS does make those who sold out at little or negative profits look foolish.
The demand can only grow. When will there ever be the excuse to remove ABSD?
Buy more before Gahmen "increase" ABSD. :)
When ABSD first came out, was only 3%, those who KPKB and waited for it to be removed may have regretted now.
I think you miss the point totally.
If Government does not seem to be short of money, why need to increase the prices of so many things that they control to raise the irk of their voting citizens?
As to " HDB get their money to build HDB" etc, looks like all those profit still not enough and hence have to raise more money???????????
If they know how HDB get their money to build HDB, they will not say Government seems to be short of money.
Why should they remove ABSD when it is big fat cash cow that people willing pay???????
They already have to have thick skin to increase prices/tariffs of car park, conservatory charges, rubbish charges, property taxes, water, soon electricity (due to carbon tariffs), soon possibly transport too? What else can they raise to increase their revenue?????????
Oh yah, heard they are going to cut Universities and ASTAR budget by 30% next year too?
Any other statutory boards also facing budget cut?
Heard coffeeshop talk asking why Government seems to be so short of money????? :dejection:
tonymontana
07-07-17, 18:39
And universities' budget are also cut 30% because they are wasting tax-payers monies? :hororr:
Universities do have income, and are somewhat autonomous.
No, they still get lots of tax-payers money (which will be cut by 30%)!
Why they are getting so much government's subsidy is anybody's guess....... may be to subsidize foreigners and PRs to study in these university?
Universities do have income, and are somewhat autonomous.
I think you miss the point totally.
If Government does not seem to be short of money, why need to increase the prices of so many things that they control to raise the irk of their voting citizens?
As to " HDB get their money to build HDB" etc, looks like all those profit still not enough and hence have to raise more money???????????
How much you need, I get HDB to print for you.
All Digit, no need paper, and ink.
The Housing & Development Board ("HDB") has issued S$600 million, 10-year Fixed Rate Notes (the “Notes”) under its S$32 billion Multicurrency Medium Term Note ("MTN") Programme.
http://www.hdb.gov.sg/cs/infoweb/press-release/hdb-issues-rated-fixed-rate-notes
If Government does not seem to be short of money, why need to increase the prices of so many things that they control to raise the irk of their voting citizens?
If you know what is Inflation, you will know they did not increase.
I can only say stupidity by people who act smart has no bound.............. :hororr:
How much you need, I get HDB to print for you.
All Digit, no need paper, and ink.
The Housing & Development Board ("HDB") has issued S$600 million, 10-year Fixed Rate Notes (the “Notes”) under its S$32 billion Multicurrency Medium Term Note ("MTN") Programme.
http://www.hdb.gov.sg/cs/infoweb/press-release/hdb-issues-rated-fixed-rate-notes
If Government does not seem to be short of money, why need to increase the prices of so many things that they control to raise the irk of their voting citizens?
If you know what is Inflation, you will know they did not increase.
I can only say stupidity by people who act smart has no bound.............. :hororr:
Your words can tinker my ass, so pain.
HDB created 32 Billion guess who created the interest for the 32 Billion.
https://www.youtube.com/watch?v=6hwqoPp2kaw
tonymontana
08-07-17, 00:41
No, they still get lots of tax-payers money (which will be cut by 30%)!
Why they are getting so much government's subsidy is anybody's guess....... may be to subsidize foreigners and PRs to study in these university?
Foreigners and PRs pay more in fees if they join the varsities.
https://www.youtube.com/watch?v=40Y64INufw0
https://www.youtube.com/watch?v=AqTjNU7mQZQ
I can only say stupidity by people who act smart has no bound.............. :hororr:
LOL.
Don't really understand the obsession with property, and treating it as active investment. Property is but the most passive type of investment.
For active investment, if you trade forex for example, with a position size of only $10 k per trade per day it is not difficult to make $10 k per month. When there is volatility, getting $2 k from a trade within 2-3 hours is not uncommon.
100% return of the position size in a month. To make $10 k per month, it requires to make only an average of $500 per day nia. The key is how to place the call or put position defensively, non aggressively.
I always advocate for a young person to start learning how to trade derivatives from early. Then when he reaches the age of 55, from then until maybe 85, he can still make good money if he keeps his mind healthy.
And sane, ahaha.
LOL.
Don't really understand the obsession with property, and treating it as active investment. Property is but the most passive type of investment.
For active investment, if you trade forex for example, with a position size of only $10 k per trade per day it is not difficult to make $10 k per month. When there is volatility, getting $2 k from a trade within 2-3 hours is not uncommon.
100% return of the position size in a month. To make $10 k per month, it requires to make only an average of $500 per day nia. The key is how to place the call or put position defensively, non aggressively.
I always advocate for a young person to start learning how to trade derivatives from early. Then when he reaches the age of 55, from then until maybe 85, he can still make good money if he keeps his mind healthy.
And sane, ahaha.
https://www.youtube.com/watch?v=dBuJhJ6ZtpA
More by how much?
As far as I know, the "more" is barely 30% more, which is still much below the costs that Government CLAIMED they need to spend to nurture 1 Uni student.........
If so, why should Singaporean tax payers subsidize these foreigners and PRs?
Foreigners and PRs pay more in fees if they join the varsities.
When an investment gets overly active, the accompanying risks also go up.
One can earn a lot using a specific investment tool means one can also lose a lot, especially in some types of trade that do not generate utility value.
For properties, the minimum to fall back to is the utility value that can be derived by an owner or tenant. This value can rise or fall but there is a guaranteed value that is not that speculative if you know what to buy.
Derivatives can be picked up anytime even after retirement using spare funds. Can you buy properties without loan after you retire?
Why you can't loan after you retire????????
When an investment gets overly active, the accompanying risks also go up.
One can earn a lot using a specific investment tool means one can also lose a lot, especially in some types of trade that do not generate utility value.
For properties, the minimum to fall back to is the utility value that can be derived by an owner or tenant. This value can rise or fall but there is a guaranteed value that is not that speculative if you know what to buy.
Derivatives can be picked up anytime even after retirement using spare funds. Can you buy properties without loan after you retire?
Why you can't loan after you retire????????
Someone earning personal wages that peaked 25 years ago will never be able to obtain loan today.
But those who took the loan and paid up over 25 years will be able to take equity loan today for derivatives and other instruments.
Prioritise!
Why you can't loan after you retire????????
Can Loan if still got income subject to TDSR.
MAS Restricts Loan Tenure for Residential Properties
Singapore, 5 October 2012...The Monetary Authority of Singapore (MAS) will restrict the tenure of loans granted by financial institutions for the purchase of residential properties. MAS’ move is part of the Government’s broader aim of avoiding a price bubble and fostering long term stability in the property market.
2 The maximum tenure of all new residential property loans will be capped at 35 years. In addition, loans exceeding 30 years tenure will face significantly tighter loan-to-value (LTV) limits. This will apply to both private properties and HDB flats. The new rules will take effect from 6 October 2012.
Long tenure loans fuel property prices
3 The new rules aim to curb continued upward pressure on residential property prices, driven by low interest rates and rapid credit growth.
4 Previous rounds of Government measures have had a moderating effect on residential property prices. There is also significant supply of housing that will come onto the market over the next two years. However, prices in both the HDB resale market and private residential property have continued to rise in Q2 and Q3 of 2012.
5 The current climate of low interest rates, globally and in Singapore, is likely to persist for some time. It will continue to spur demand in the residential property market, pushing up prices beyond sustainable levels. The eventual correction could be painful to borrowers and destabilise the economy.
6 At the same time, financial institutions have been lengthening the tenures of residential property loans. Over the last three years, the average tenure for new residential property loans has increased from 25 to 29 years. More than 45% of new residential property loans granted by financial institutions have tenures exceeding 30 years.
7 Long tenure loans pose risks to both lenders and borrowers. The lower initial monthly repayments, made possible by long loan tenures and the current low interest rates, may lead borrowers to over-estimate their ability to service the loans, and take a bigger loan than they can really afford. A rising property market may give false confidence to both borrowers and lenders that should there be difficulty in servicing the loan they can always sell the property at a higher price. In reality, long tenure loans impose a larger debt repayment burden on borrowers as interest accumulates over a longer period. When interest rates eventually rise, borrowers who have overextended themselves will have difficulties repaying their loans. If property prices fall, financial institutions may be caught holding the bad loans.
8 Mr Tharman Shanmugaratnam, Chairman of MAS, said, “Monetary conditions worldwide are far from normal. QE3 and low interest rates have made credit easy, but this will eventually change. We are taking this step now to require more prudent lending, and will continue to watch the property market carefully. We will do what it takes to cool the market, and avoid a bubble that will eventually hurt borrowers and destabilise our financial system.”
New rules on loan tenure
9 The new MAS rules impose an absolute limit of 35 years on the tenure of all loans for residential property. This will apply to loans to both individual and non-individual borrowers, as well as refinancing loans1, from 6 October 2012.2
10 In addition, MAS will lower the LTV ratio for new residential property loans to borrowers who are individuals, if:
the tenure exceeds 30 years; or
the loan period extends beyond the retirement age of 65 years.
For these loans, the LTV limit will be:
40% for a borrower with one or more outstanding residential property loans3; and
60% for a borrower with no outstanding residential property loan.
11 MAS will also lower the LTV ratio for residential property loans to non-individual borrowers from 50% to 40%.
http://www.executivecondos.com.sg/wp-content/uploads/2013/09/MAS-LTV-Chart.jpg
Still don't understand why you can't get any loan when you have no wages.
A person can still get loan with no wages and no property..........
Someone earning personal wages that peaked 25 years ago will never be able to obtain loan today.
But those who took the loan and paid up over 25 years will be able to take equity loan today for derivatives and other instruments.
Prioritise!
Still don't understand why you can't get any loan when you have no wages.
A person can still get loan with no wages and no property..........
Where are you when they announce all the Control Measure.
My friend father 75 years old with no job was given a 25 years loan before the Control Measure.
Property control measure or not is not material because people can still get loan with no wages and no property..............
Hack, you don't even need loan to get leverage to earn more money (if you know how). Think Hakuho already leaked something on that (but there are more ways)................
Just that you need an open mind and learn how to go about doing it.........
Property is not my whole world and not my 1 and only investment (and never be)..................
Where are you when they announce all the Control Measure.
My friend father 75 years old with no job was given a 25 years loan before the Control Measure.
Someone earning personal wages that peaked 25 years ago will never be able to obtain loan today.
But those who took the loan and paid up over 25 years will be able to take equity loan today for derivatives and other instruments.
Prioritise!
LOL.
Don't really understand the obsession with property, and treating it as active investment. Property is but the most passive type of investment.
For active investment, if you trade forex for example, with a position size of only $10 k per trade per day it is not difficult to make $10 k per month. When there is volatility, getting $2 k from a trade within 2-3 hours is not uncommon.
100% return of the position size in a month. To make $10 k per month, it requires to make only an average of $500 per day nia. The key is how to place the call or put position defensively, non aggressively.
I always advocate for a young person to start learning how to trade derivatives from early. Then when he reaches the age of 55, from then until maybe 85, he can still make good money if he keeps his mind healthy.
And sane, ahaha.
Property control measure or not is not material because people can still get loan with no wages and no property..............
Hack, you don't even need loan to get leverage to earn more money (if you know how). Think Hakuho already leaked something on that (but there are more ways)................
Just that you need an open mind and learn how to go about doing it.........
Property is not my whole world and not my 1 and only investment (and never be)..................
One of the way is the Riway thing. Pay 3,000 get more people to pay 3,000.
LOL.
Don't really understand the obsession with property, and treating it as active investment. Property is but the most passive type of investment.
For active investment, if you trade forex for example, with a position size of only $10 k per trade per day it is not difficult to make $10 k per month. When there is volatility, getting $2 k from a trade within 2-3 hours is not uncommon.
100% return of the position size in a month. To make $10 k per month, it requires to make only an average of $500 per day nia. The key is how to place the call or put position defensively, non aggressively.
I always advocate for a young person to start learning how to trade derivatives from early. Then when he reaches the age of 55, from then until maybe 85, he can still make good money if he keeps his mind healthy.
And sane, ahaha.
I didn't say don't invest in property. By your own means, buy the first property and then another (or more) property for investment.
Even for something so straightforward, there are different ways to achieve a better result.
For example, for a young person starting out without help from his parents, the BTO route offers a clear edge.
For example, there is no edge to buy new launch unless you think the new launch unit is so outstanding, so different that a renter is going to pay much more to rent it from you instead of another unit in the neighbourhood. For a new launch, essentially a buyer is paying to the developer/government the rights to boost the land value of the neighbourhood.
For example, treating LH the same as FH. LOL.
I said that there is a difference in investing passively and actively.
For example an investment in bond. Investing passively means you buy the good grade bond in cash and basically collect the coupons till maturity and get the principal back. That's all.
But to invest actively in the same bond, then it is a different story because you will be leveraging and also looking to profit from the bond price as well. In this case, the ability of the buyer in pricing the bond properly becomes crucial. This is what Vic is doing.
Normally, a property investment should be passive but here people seem to treat it as active.
I am saying if you want to invest actively, property is not the right instrument. Beside, there should be a good mix, a proper allocation of capital to passive and active investments in one’s portfolio anyway.
That is why when one is young and actively earning an income with almost no time to manage active investments due to other commitments in life, property has to one of the main bets. It also forces one to save. This is especially true for the higher educated ones holding stable jobs.
When one is old and can't hold onto any fixed income for long, then that's perhaps the time to switch to learn to be an active investor?
LOL.
Don't really understand the obsession with property, and treating it as active investment. Property is but the most passive type of investment.
For active investment, if you trade forex for example, with a position size of only $10 k per trade per day it is not difficult to make $10 k per month. When there is volatility, getting $2 k from a trade within 2-3 hours is not uncommon.
100% return of the position size in a month. To make $10 k per month, it requires to make only an average of $500 per day nia. The key is how to place the call or put position defensively, non aggressively.
I always advocate for a young person to start learning how to trade derivatives from early. Then when he reaches the age of 55, from then until maybe 85, he can still make good money if he keeps his mind healthy.
And sane, ahaha.
I was a trader before and there is no guarantee profit in trades and perhaps if u have 50% of trade correct, you are good.
In fact, statistically, if not wrong, only about 5% can make profit consistently.
I have very heavy position still in FX and bonds.
anythingwhatever
09-07-17, 22:44
I was a trader before and there is no guarantee profit in trades and perhaps if u have 50% of trade correct, you are good.
In fact, statistically, if not wrong, only about 5% can make profit consistently.
I have very heavy position still in FX and bonds.
Investments in Stocks and FX may not be for everyone, especially those with a weak heart...
The daily emotional stress may be too much to bear. :)
Investments in Stocks and FX may not be for everyone, especially those with a weak heart...
The daily emotional stress may be too much to bear. :)
ya...fully agreed with this....Investment is not too stressful but not speculation as day traders....
tonymontana
10-07-17, 08:45
I was a trader before and there is no guarantee profit in trades and perhaps if u have 50% of trade correct, you are good.
In fact, statistically, if not wrong, only about 5% can make profit consistently.
I have very heavy position still in FX and bonds.
Agree. Property is still the safest way to invest for me. I tried short term trading before, that didn't really work out for me.
Buying blue chips at bargain prices during market downturns and holding them for medium term ( a couple of years) worked well.
My experience was the shorter the investment time frame was, the worse my performance got.
My Reits were also doing OK until they got hammered last year when fears of interest rate hikes hit the market.
The bad thing about property is once you pull the trigger, it's locked in for the long term.
Agree. Property is still the safest way to invest for me. I tried short term trading before, that didn't really work out for me.
Buying blue chips at bargain prices during market downturns and holding them for medium term ( a couple of years) worked well.
My experience was the shorter the investment time frame was, the worse my performance got.
My Reits were also doing OK until they got hammered last year when fears of interest rate hikes hit the market.
The bad thing about property is once you pull the trigger, it's locked in for the long term.
Every investment comes with pros and cons. For properties, the biggest headache is super illiquid, and hard to maintain and to please all sort of tenants. sian...and government tax on rental income...worst
At this time, liquid assets are still the best....but US stocks are now very over valued, Singapore stocks...very sian...
Perhaps, EM bonds and high yield bonds are now better
Rental income helps to equalise income disparity mah. Anyway interest paid can offset much of these income tax in the first several years of the mortgage.
Every investment comes with pros and cons. For properties, the biggest headache is super illiquid, and hard to maintain and to please all sort of tenants. sian...and government tax on rental income...worst
At this time, liquid assets are still the best....but US stocks are now very over valued, Singapore stocks...very sian...
Perhaps, EM bonds and high yield bonds are now better
Rental income helps to equalise income disparity mah. Anyway interest paid can offset much of these income tax in the first several years of the mortgage.
For those acquired investment properties in these two years, even so, at high price, the negative cash flow will kill the weak holders
Amber Woods
10-07-17, 11:48
For those acquired investment properties in these two years, even so, at high price, the negative cash flow will kill the weak holders
Arcachon mentioned that he also suffered negative cash flow after buying into Terrasse in 2011 despite keeping his Southbank and HDB flat for rental. I believe he is not one of the weak holders because he still advocates buying more if bank can lend him more. What is your take on his strategy?
For those acquired investment properties in these two years, even so, at high price, the negative cash flow will kill the weak holders
Again it depends on what is bought.
For example, if it is a OCR MM unit bought at 700K, assuming max 80% loan at 2% interest for 25 years (all the current normal max combination), the monthly "loss" will not exceed 1K when rented, which can easily be covered by the CPF of someone earning 5K. For most, the "loss" (which actually is saved through mortgage payment) if any is no more than a few hundred.
For larger units, need to work with permutations to balance the cash flow, but "loss" again if any still quite easily settled by CPF.
All these will be clarified if and when vacancy rates start to dip significantly. Everybody's gotta be patient and wait.
Why should they remove ABSD when it is big fat cash cow that people willing pay???????
They already have to have thick skin to increase prices/tariffs of car park, conservatory charges, rubbish charges, property taxes, water, soon electricity (due to carbon tariffs), soon possibly transport too? What else can they raise to increase their revenue?????????
Oh yah, heard they are going to cut Universities and ASTAR budget by 30% next year too?
Any other statutory boards also facing budget cut?
Heard coffeeshop talk asking why Government seems to be so short of money????? :dejection:
GIC have been losing mony from their investment this past few years.
In 2015 the 20-years annualized return was 4.9%. In 2016 it became 4%. And this year it further reduced to 3.7%.
By publishing 20-years annualized return it made it look like they are still making money, just less profit, but actually losing :).
For those acquired investment properties in these two years, even so, at high price, the negative cash flow will kill the weak holders
Weak holders and speculators are running out of existence due to CMs. Slightly negative cash flow is not as alarming as no cash flow. At the right price, there is always a tenant to be found. I never been on a plane coming to Sg where there are empty seats. The brilliant thing about property investment is you can count the foot traffics, the lenght in which people are queing for food in the area before investing. For stocks and bonds there is no way to personally verify the data yourself.
PropVestor
10-07-17, 12:10
To me, property investors all need to have holding power. If you are the instant gratification type, you will think 'there are always other faster way'. I am sure there is. If the investor can get the leverage, their gearing can take them to whatever levels the bank and the investor sees fit. Positive or negative cash flow, only the investor knows.
2 cents,
PropVestor
I was a trader before and there is no guarantee profit in trades and perhaps if u have 50% of trade correct, you are good.
In fact, statistically, if not wrong, only about 5% can make profit consistently.
I have very heavy position still in FX and bonds.
But of course it is never as easy as I wrote, and it was just a illustration.
The main problem people faced is that, to trade well it is so counter-intuitive to how we make a buy or sell decision for everything else everyday. For example, in buying a car, a fridge etc; in selling a property, in deciding how much rental to pay etc.
We should trade what we see, not what we THINK. I don't care if the market is trading, for example pricing AUDUSD correctly at any moment. All I care is whether I see the price direction correctly.
I let the market to decide the price direction.
50-50 is the overall statistics, all we have to do is to improve it to 60:40 to gain an edge. There are ways to do this.
It is so important to keep your emotion in check when investing actively. This can be managed through having the right size of a trade.
If you have been watching the price action for an hour before placing a trade, and if the price moves against you the moment after placing it, then the probability is very high that your reading is wrong.
Since it is wrong, the next thing to do is get out and look at it again. When the position was placed defensively, there is usually the room to get out with a small loss or breakeven.
When the trade is correct, then it is just to ride it out.
Amber Woods
10-07-17, 14:32
Weak holders and speculators are running out of existence due to CMs. Slightly negative cash flow is not as alarming as no cash flow. At the right price, there is always a tenant to be found. I never been on a plane coming to Sg where there are empty seats. The brilliant thing about property investment is you can count the foot traffics, the lenght in which people are queing for food in the area before investing. For stocks and bonds there is no way to personally verify the data yourself.
With or without CMs, there are always weak holders though less speculators with CMs. Weak holders are those who stretch all themselves to buy even if it means at 40% LTV. The 40% loan can also kill them if they lose their jobs or encounter serious negative cash flow from their investments for a longer period of time.
With or without CMs, there are always weak holders though less speculators with CMs. Weak holders are those who stretch all themselves to buy even if it means at 40% LTV. The 40% loan can also kill them if they lose their jobs or encounter serious negative cash flow from their investments for a longer period of time.
yes, u got me right....especially when there is recession....or job loss
Actually, CMs like higher LTV cause more property buyers to become weak holders (despite many claims about higher LTV means better protection for buyers blah blah blah especially propagated by the mass media)!
Wait till the tide turn and more people will end up with their properties forced sold (vs lower LTV)!
With or without CMs, there are always weak holders though less speculators with CMs. Weak holders are those who stretch all themselves to buy even if it means at 40% LTV. The 40% loan can also kill them if they lose their jobs or encounter serious negative cash flow from their investments for a longer period of time.
With or without CMs, there are always weak holders though less speculators with CMs. Weak holders are those who stretch all themselves to buy even if it means at 40% LTV. The 40% loan can also kill them if they lose their jobs or encounter serious negative cash flow from their investments for a longer period of time.
Heng arh, luckily I am a strong buyer with 80% LTV.
Amber Woods
10-07-17, 15:20
Heng arh, luckily I am a strong buyer with 80% LTV.
Good that you are a strong buyer.
Whether 40% LTV or 80% LTV, there will always be weak holders as long as they do not have enough cash cash to tie over bad times.
Actually, CMs like higher LTV cause more property buyers to become weak holders (despite many claims about higher LTV means better protection for buyers blah blah blah especially propagated by the mass media)!
Wait till the tide turn and more people will end up with their properties forced sold (vs lower LTV)!
Negative cash flow really means u getting less income. Your money goes into equity instead of your bank account. It doesn't mean you are losing money.
Amber Woods
10-07-17, 17:34
Negative cash flow really means u getting less income. Your money goes into equity instead of your bank account. It doesn't mean you are losing money.
Negative cash flow in finance means after putting in your investment for an asset, the revenue (in term of cash generated) generated by this asset is insufficient to cover the cost (cash needed to hold this asset) of holding it. That is 'cash in' minus 'cash out' is negative.
Negative cash flow in finance means after putting in your investment for an asset, the revenue (in term of cash generated) generated by this asset is insufficient to cover the cost (cash needed to hold this asset) of holding it. That is 'cash in' minus 'cash out' is negative.
What i struggle to understand is how come 40% LTV can be negative cash flow for an investment property.
The property selling for 1 mil only needs to be rented at 2K or so to be in the positive.
40% LTV means that your 20% got stuck as downpayment and there is a HUGE opportunity costs when this 20% could earn much higher returns, like >10% p.a. (rather than buying a property and earning like <2% net rental yield). :hopelessness:
What i struggle to understand is how come 40% LTV can be negative cash flow for an investment property.
The property selling for 1 mil only needs to be rented at 2K or so to be in the positive.
Amber Woods
10-07-17, 18:22
What i struggle to understand is how come 40% LTV can be negative cash flow for an investment property.
The property selling for 1 mil only needs to be rented at 2K or so to be in the positive.
Answers:
With or without CMs, there are always weak holders though less speculators with CMs. Weak holders are those who stretch all themselves to buy even if it means at 40% LTV. The 40% loan can also kill them if they lose their jobs or encounter serious negative cash flow from their investments for a longer period of time.
yes, u got me right....especially when there is recession....or job loss
tonymontana
10-07-17, 18:22
Negative cash flow in finance means after putting in your investment for an asset, the revenue (in term of cash generated) generated by this asset is insufficient to cover the cost (cash needed to hold this asset) of holding it. That is 'cash in' minus 'cash out' is negative.
yes, but indomie;s point is negative cash flow doesn't mean you're losing money. Your monthly mortgage isn't totally a cost, only a portion of that is considered cost of holding. The portion that doesn't pay off interest pays down your mortgage, which (barring a catastrophic crash in the market) you eventually get to cash out, either via a direct disposal or equity loan.
tonymontana
10-07-17, 18:25
Answers:
40% LTV of 1M dollar property means one put down 600k, loan 400k.
over 25 years, using ocbc home calculator, this means 1.6k per month repayment.
so unless the 1m property cannot be rented out for 2k, how can it be -ve cash flow?
Amber Woods
10-07-17, 18:25
yes, but indomie;s point is negative cash flow doesn't mean you're losing money. Your monthly mortgage isn't totally a cost, only a portion of that is considered cost of holding. The portion that doesn't pay off interest pays down your mortgage, which (barring a catastrophic crash in the market) you eventually get to cash out, either via a direct disposal or equity loan.
When you talk about cash flow, it is cash in vs cash out. You go bankrupt because of cash flow problem. So cash flow is important for investment asset.
tonymontana
10-07-17, 18:29
When you talk about cash flow, it is cash in vs cash out. You go bankrupt because of cash flow problem. So cash flow is important for investment asset.
Oh i see, but that's if one is maxed out to the hilt, holding onto 10 properties and you're not working (no other income). so any disruption will bring the whole thing crashing down like a house of cards. I believe most of us can "tong" not so good rental for quite a while. (Well, i hope so, anyway :p)
Amber Woods
10-07-17, 18:29
40% LTV of 1M dollar property means one put down 600k, loan 400k.
over 20 years, off the top of my head, this means 1.5k per month repayment.
so unless the 1m property cannot be rented out for 2k, how can it be -ve cash flow?
There are other holding costs such as monthly maintenance fee, property tax and repair & maintenance. Also during a recession, there is high chance that you cannot rent out and therefore, therefore is no income or cash in.
Amber Woods
10-07-17, 18:30
No lah, that's if one is maxed out to the hilt, holding onto 10 properties and you're not working (no other income). so any disruption will bring the whole thing crashing down like a house of cards. I believe most of us can "tong" not so good rental for quite a while. (Well, i hope so, anyway :p)
If you can 'tong' means you are not a weak holder.
tonymontana
10-07-17, 18:31
There are other holding costs such as monthly maintenance fee, property tax and repair & maintenance. Also during a recession, there is high chance that you cannot rent out and therefore, therefore is no income or cash in.
OK, point noted. but i cannot imagine "cannot rent out". sure can rent out one.
tonymontana
10-07-17, 18:33
If you can 'tong' means you are not a weak holder.
my point is i don't see a lot of people (peers, relatives, friends of friends etc) who are so leveraged out with so many properties that one hit causes that person to go bankrupt. But i agree, it's good to be prudent when investing and don't be greedy.
40% LTV means that your 20% got stuck as downpayment and there is a HUGE opportunity costs when this 20% could earn much higher returns, like >10% p.a. (rather than buying a property and earning like <2% net rental yield). :hopelessness:
Yes but won't be cash negative what, unless we are talking about black swans or dead swans again.
Amber Woods
10-07-17, 18:35
OK, point noted. but i cannot imagine "cannot rent out". sure can rent out one.
In a recession, it will take a much longer time to rent out and with low rental. So this period of no income is real.
In a recession, it will take a much longer time to rent out and with low rental. So this period of no income is real.
Just buy a mortgage insurance then
Why not?
You still haven't include:
1) Property tax
2) Maintenance and sinking fund
3) Repairs and maintenance costs
4) Agent fees
5) Periods when you can't rent out or un-occupied when in-between finding new tenants
Yes but won't be cash negative what, unless we are talking about black swans or dead swans again.
Sure can rent out?
You are too young to experience the time when 1998 Hillview 3BR condos $1200 pm no takers?!
Where is your property located that you so sure sure can rent out?
OK, point noted. but i cannot imagine "cannot rent out". sure can rent out one.
tonymontana
10-07-17, 20:46
Sure can rent out?
You are too young to experience the time when 1998 Hillview 3BR condos $1200 pm no takers?!
Where is your property located that you so sure sure can rent out?
1998 hillview only got like 2 condo there, are you sure 1200$pm no takers? Maybe your agent is lazy? I mean if somehow your property whenever a potential tenant view there is a voice shouting "GET OUT!!!!" , then bro, I cannot helpch u. anyway, who ask you to buy hillview for rental? Now I beginning to think you are not as wise as I thought you were. My mistake, sorry!.
Wah like that you can figure out! Very clever you!!!!!!
Was reading the headline news like :
http://www.businesstimes.com.sg/government-economy/gic-prepares-for-protracted-uncertainty-low-returns
"GIC prepares for protracted uncertainty, low returns
It asks to be prepared for underperformance relative to market indices, posts 20-year real return at 3.7% for FY17"
and the news seem to tell us that GIC returns is underperforming at 3.7% for FY2017 (misleadingly) so never really think much into it until you reveal the details.
That makes me wonder what and where they are losing so much money (when almost everything we know are up and up)??????
This kind of news is all the more reason for us not to believe what the mass media reports at face value since they are probably just telling the half-truth..........
And what is the definition of "half-truth"?
I suppose Benjamin Franklin, 1 of the founding fathers of USA, defines it very well:
http://izquotes.com/quotes-pictures/quote-half-a-truth-is-often-a-great-lie-benjamin-franklin-65334.jpg
As a politician, I suppose he knows very well what "half-truth" are meant for and there is only 1 purpose?
GIC have been losing mony from their investment this past few years.
In 2015 the 20-years annualized return was 4.9%. In 2016 it became 4%. And this year it further reduced to 3.7%.
By publishing 20-years annualized return it made it look like they are still making money, just less profit, but actually losing :).
Included everything you can imagine.
1 mil 40% LTV is only 400k. The mortgage is only 1400 to 1600 per month, who can't settle still want to buy?
Why not?
You still haven't include:
1) Property tax
2) Maintenance and sinking fund
3) Repairs and maintenance costs
4) Agent fees
5) Periods when you can't rent out or un-occupied when in-between finding new tenants
Just buy a mortgage insurance then
true or not? Mortgage insurance covers jobless or no rental?
Mortgage insurance, covers loss of earning capacity or death
Another half-truth or faked news??????
Since Law Minister Shanmugam is going to introduce new laws to deal with people telling faked news, I wonder whether he is going to deal with those telling half-truth?
Since Benjamin Franklin already told us that: "Half a truth is often a great lie", so really "half-truth" is really no difference from faked news (in their intention)! :panda:
true or not? Mortgage insurance covers jobless or no rental?
Mortgage insurance, covers loss of earning capacity or death
$1M private property? Most likely a few months to a year or 2 no tenant type in OCR when shit hit the fence?
Included everything you can imagine.
1 mil 40% LTV is only 400k. The mortgage is only 1400 to 1600 per month, who can't settle still want to buy?
$1M private property? Most likely a few months to a year or 2 no tenant type in OCR when shit hit the fence?
OK how about 3 million only loan 1.2mil.
true or not? Mortgage insurance covers jobless or no rental?
Mortgage insurance, covers loss of earning capacity or death
Buy mortgage insurance and income protection insurance. Now you are bullet proof.
Arcachon mentioned that he also suffered negative cash flow after buying into Terrasse in 2011 despite keeping his Southbank and HDB flat for rental. I believe he is not one of the weak holders because he still advocates buying more if bank can lend him more. What is your take on his strategy?
To understand my strategy, one need to watch this video.
https://www.youtube.com/watch?v=fsrtB5lp60s
Pay $1.8M upfront to earn net return of <2%?
I can only say 1 word: Stupid! :sorrow:
OK how about 3 million only loan 1.2mil.
Pay $1.8M upfront to earn net return of <2%?
I can only say 1 word: Stupid! :sorrow:
Focus...
We are only talking about whether got negative cash flow.
How to claim "income protection insurance" when you lost your income not due to disability? Are you going to throw yourself in front of the bus or train to create disability so that you can claim this insurance????? :sorrow:
Buy mortgage insurance and income protection insurance. Now you are bullet proof.
https://www.youtube.com/watch?v=XbEu-OLMKLQ
Amber Woods
11-07-17, 05:06
To understand my strategy, one need to watch this video.
I feel sorry for you if these videos lead you to where you are now with unrealised profits but negative cash flow.
You should try to rebalance your portfolio such that you can achieve positive cash flow. It is not profit and loss that make you bankrupt. It is negative cash flow which can lead you to bankruptcy.
The ignorant investor chase after unrealised profits. The wise investor look at positive cash flow generating from his investments.
In a recession, it will take a much longer time to rent out and with low rental. So this period of no income is real.
In recession what investments to hold are the best?
Or hold cash throughout?
In recession what investments to hold are the best?
Or hold cash throughout?
at time of recession, assets are getting cheaper, thus shall hold cash in strong currency with economy growth.
I feel sorry for you if these videos lead you to where you are now with unrealised profits but negative cash flow.
You should try to rebalance your portfolio such that you can achieve positive cash flow. It is not profit and loss that make you bankrupt. It is negative cash flow which can lead you to bankruptcy.
The ignorant investor chase after unrealised profits. The wise investor look at positive cash flow generating from his investments.
How can you assume he is in negative cash flow???? Please do not assume, it's like fake news.
Amber Woods
11-07-17, 07:49
In recession what investments to hold are the best?
Or hold cash throughout?
Recession is the time to scoop up distressed assets from weak holders.
Amber Woods
11-07-17, 07:50
How can you assume he is in negative cash flow???? Please do not assume, it's like fake news.
Arcachon had admitted that he was suffering from negative cash flow in another thread. You are not following.
How to claim "income protection insurance" when you lost your income not due to disability? Are you going to throw yourself in front of the bus or train to create disability so that you can claim this insurance????? :sorrow:
https://www.manulife.com.sg/DBS_and_Manulife_launch_first_in_market_income_protection_solutions
Recession is the time to scoop up distressed assets from weak holders.
Yes....timing is the most critical....
Distressed, quality assets...
What is that? If you buy that insurance, can you claim "insurance" payout when you lost your income not due to disability? Seems not........ :tsk-tsk:
https://www.manulife.com.sg/DBS_and_Manulife_launch_first_in_market_income_protection_solutions
What is that? If you buy that insurance, can you claim "insurance" payout when you lost your income not due to disability? Seems not........ :tsk-tsk:
Manulife IncomeGuard+ is an affordable insurance solution which will provide monthly income for customers for loss of income arising from death, critical illness, total permanent disability or retrenchment.
Arcachon had admitted that he was suffering from negative cash flow in another thread. You are not following.
He show his mortgage payment and rental. That's all. So how did u conclude?
If he has cpf in his account, would that constitute a negative cash flow?
Recession is the time to scoop up distressed assets from weak holders.
It's an Oxleymoron to say that recession is the time to buy assets.
What happens if the ship captains continue to avert recession well by periodically marginally stimulating the market here and there, and recession never comes?
Would you hold cash throughout, or invest in stocks, bonds or other derivatives while you wait for the recession that may never come?
Amber Woods
11-07-17, 09:53
He show his mortgage payment and rental. That's all. So how did u conclude?
If he has cpf in his account, would that constitute a negative cash flow?
Please go and ask Arcachon.
Amber Woods
11-07-17, 09:56
It's an Oxleymoron to say that recession is the time to buy assets.
What happens if the ship captains continue to avert recession well by periodically marginally stimulating the market here and there, and recession never comes?
Would you hold cash throughout, or invest in stocks, bonds or other derivatives while you wait for the recession that may never come?
Obviously, you did not read my other threads.
Please go and ask Arcachon.
No need
It's an Oxleymoron to say that recession is the time to buy assets.
What happens if the ship captains continue to avert recession well by periodically marginally stimulating the market here and there, and recession never comes?
Would you hold cash throughout, or invest in stocks, bonds or other derivatives while you wait for the recession that may never come?
If recession never come in the next 5years it will be game over for those age 45yrs old and above. By then they will be 50+yrs old. Those 50+yrs old will be in ard 60yrs old.
tonymontana
11-07-17, 10:08
In recession what investments to hold are the best?
Or hold cash throughout?
There is no such thing as cannot rent out for one year ie cannot find tenant.
cannot find buyer, yes, possible. lousy rental, yes , possible. negative cash flow, yes. Cannot find tenant? I seriously doubt it, landlord must be unlucky, stubborn or doing something wrong. So far I haven't heard or encountered. Yes, even in 1999-2001. at that time, jurong west HDB common room rental was 300$, master $400, easily can rent out.
tonymontana
11-07-17, 10:13
I feel sorry for you if these videos lead you to where you are now with unrealised profits but negative cash flow.
You should try to rebalance your portfolio such that you can achieve positive cash flow. It is not profit and loss that make you bankrupt. It is negative cash flow which can lead you to bankruptcy.
The ignorant investor chase after unrealised profits. The wise investor look at positive cash flow generating from his investments.
Maybe some investors don't really care about cash flow that much, they just feel more secure with their money invested in property?
tonymontana
11-07-17, 10:15
It's an Oxleymoron to say that recession is the time to buy assets.
What happens if the ship captains continue to avert recession well by periodically marginally stimulating the market here and there, and recession never comes?
Would you hold cash throughout, or invest in stocks, bonds or other derivatives while you wait for the recession that may never come?
it's not an oxleymoron, it's called market sophistry! :p
Amber Woods
11-07-17, 10:20
Maybe some investors don't really care about cash flow that much, they just feel more secure with their money invested in property?
For investors who have no concern about negative cash flow, obviously they have the ability to hold in perpetually.
Then it is useless to the person because it does not cover not having rental income from tenant!
Furthermore, you are engaging in telling "half-truth" because the retrenchment benefits is like this:
"Retrenchment Benefit
If you are Retrenched and remain unemployed for a minimum period of 30 consecutive days, the Insurer will pay Monthly Benefit for a period of 3 months.
If you have secured employment following the Retrenchment before the claim is approved, you are required to inform the Insurer of the new employment and no Retrenchment Benefit shall be payable. The Insurance Cover will continue to be in force."
Oh yah, the retrenchment is only for a max of 3 months!!!!!!!!!!!!!!!!!!!!! If the person don't even have 3 months of money for living expenses, why is he even buying property???? :banghead:
Manulife IncomeGuard+ is an affordable insurance solution which will provide monthly income for customers for loss of income arising from death, critical illness, total permanent disability or retrenchment.
What is that? If you buy that insurance, can you claim "insurance" payout when you lost your income not due to disability? Seems not........ :tsk-tsk:
Arcachon had admitted that he was suffering from negative cash flow in another thread. You are not following.
https://lifefitnessbydane.files.wordpress.com/2015/02/cuphalffull.jpg?w=830
Depends on how you see it, I see negative cash flow.
If I stay in HDB then positive Cash flow, but then how many 10 years do I have.
It is not how fast you start at a race to determine whether you win or not, it is the finish line that determines.
https://scontent-frt3-1.xx.fbcdn.net/v/t1.0-9/11070226_10204807877929693_3289811458906968265_n.jpg?oh=d36516d0c57c5fcdfac03278edf4395f&oe=59CFE04B
Wow so fat, was overweight by 10 kg then.
https://www.facebook.com/Diabetes-1071473759546520/
https://lifefitnessbydane.files.wordpress.com/2015/02/cuphalffull.jpg?w=830
Depends on how you see it, I see negative cash flow.
If I stay in HDB then positive Cash flow, but then how many 10 years do I have.
It is not how fast you start at a race to determine whether you win or not, it is the finish line that determines.
👍👍👍👍👍
Need to enjoy life in the silver age. Cannot let others tell u how to run your life. How many more years to go, right? I am also enjoying life👍
Amber Woods
11-07-17, 11:01
https://lifefitnessbydane.files.wordpress.com/2015/02/cuphalffull.jpg?w=830
Depends on how you see it, I see negative cash flow.
If I stay in HDB then positive Cash flow, but then how many 10 years do I have.
It is not how fast you start at a race to determine whether you win or not, it is the finish line that determines.
https://scontent-frt3-1.xx.fbcdn.net/v/t1.0-9/11070226_10204807877929693_3289811458906968265_n.jpg?oh=d36516d0c57c5fcdfac03278edf4395f&oe=59CFE04B
Wow so fat, was overweight by 10 kg then.
Didn't I say you should rebalance your portfolio? Stay in HDB flat and rent out Terrasse is also part of portfolio balancing. You were asking for advice but you already prepared to be in negative cash position despite feeling uneasy about it.
Then it is useless to the person because it does not cover not having rental income from tenant!
Furthermore, you are engaging in telling "half-truth" because the retrenchment benefits is like this:
"Retrenchment Benefit
If you are Retrenched and remain unemployed for a minimum period of 30 consecutive days, the Insurer will pay Monthly Benefit for a period of 3 months.
If you have secured employment following the Retrenchment before the claim is approved, you are required to inform the Insurer of the new employment and no Retrenchment Benefit shall be payable. The Insurance Cover will continue to be in force."
Oh yah, the retrenchment is only for a max of 3 months!!!!!!!!!!!!!!!!!!!!! If the person don't even have 3 months of money for living expenses, why is he even buying property???? :banghead:
Buy 2 or 3 policies then
Didn't I say you should rebalance your portfolio? Stay in HDB flat and rent out Terrasse is also part of portfolio balancing. You were asking for advice but you already prepared to be in negative cash position despite feeling uneasy about it.
Thanks for the advice, will be doing my balancing when I retire soon.
I did not prepare to be in negative cash position, it happens after my son returns to Singapore for his national service.
He stays at my SIL place for 2 years and Terrasse happens to TOP after his two years stay and me and my wife also returning from France.
The market condition also not good for the rental.
PropVestor
11-07-17, 11:40
Thanks for the advice, will be doing my balancing when I retire soon.
I did not prepare to be in negative cash position, it happens after my son returns to Singapore for his national service.
He stays at my SIL place for 2 years and Terrasse happens to TOP after his two years stay and me and my wife also returning from France.
The market condition also not good for the rental.
I am sure everything will work out fine. You are in a position far better than most Singaporeans. Having to own more than more property in itself is not an easy feat. Sometimes we beat ourselves up too much. For every investment, I do not believe everything will work out 100% all the time. There will be lapses and gaps which we need to fill in from somewhere else.
Sometimes we just need to take it easy and just enjoy family time.
2 cents,
PropVestor
One will surely need a place to stay as well.
Based on the addresses, I believe it is a better deal to rent out the HDB and stay in Terrasse penthouse (this kind needs a strata of people to appreciate).
The best immediate cash flow deal is to get the Govt Flexi-2rm and sell off everything else. But even Woods will not go for it if given a chance, unless really bopian.
Thanks for the advice, will be doing my balancing when I retire soon.
I did not prepare to be in negative cash position, it happens after my son returns to Singapore for his national service.
He stays at my SIL place for 2 years and Terrasse happens to TOP after his two years stay and me and my wife also returning from France.
The market condition also not good for the rental.
👍👍👍👍👍
Need to enjoy life in the silver age. Cannot let others tell u how to run your life. How many more years to go, right? I am also enjoying life👍
I fully agreed with this. I am now working 3-days, min stress, good pay and with a long weekend....
Good work life balance..
cannot take full retirement life....
I fully agreed with this. I am now working 3-days, min stress, good pay and with a long weekend....
Good work life balance..
cannot take full retirement life....
Great! When young work hard and follow that rainbow.
When older will have many more choices in life.
I am still in the work like crazy phase.
Great! When young work hard and follow that rainbow.
When older will have many more choices in life.
I am still in the work like crazy phase.
When you are young, you are selling your health for wealth
When you are old, you cannot use your wealth to buy back your health..
So....no need to have too much money....that does not belong to you....
Amber Woods
11-07-17, 14:25
Thanks for the advice, will be doing my balancing when I retire soon.
I did not prepare to be in negative cash position, it happens after my son returns to Singapore for his national service.
He stays at my SIL place for 2 years and Terrasse happens to TOP after his two years stay and me and my wife also returning from France.
The market condition also not good for the rental.
Base on my memory of your portfolio, the current valuation is about $3.6m and your total liability is about $1.8m leaving you with a net asset value of $1.8m (base on current valuation). However, your net asset is not generating positive cash flow because these assets are unrealised (not sold and under financing).
You mentioned that your salary is about $2500 pm and assuming that you are getting by via your salary (since there is no additional cash generated from your assets), you will also need at least $2500 pm to get by when you retired.
So your balancing of portfolio will need to generate at least $2500 pm net in cash. Staying in your HDB flat and renting out Terressa may not enough to provide you with the $2500 you need but will not leave you in cash negative. Therefore, you may need to reduce your liability by selling off one of your asset.
Your HDB flat gives the highest yield so you may want to keep it. However, beware of the running lease and also possible change in policy preventing you from renting out the whole flat in the future.
Selling your Southbank or Terrasse may be the only option. The Terrasse was bought on the high in 2011 hence it is your greatest liability which you may want to consider to let go so that you can generate cash positive of $2500 pm you need with Southbank rented out.
There is no need for you to settle for a 2-rm flexible HDB flat as suggested by Mr K.
Of course if you choose not to retire and continue to work and reduce your liability for the next 10 to 15 years, you may have the opportunity to keep all your assets and double your cash from $2500 to $5000 pm. By then you will be above 65 yrs and your CPF Life will provide you with at least another $800 pm.
So the question is whether you want to retire at 55 or 65 and that makes quite a different. However, bear in mind Singapore growth is on the low going forward and black swan may hit us over the next 10 years. You must be prepared that the value of your assets may not be worth the same value now but your liability remains the same less the principle you paid down. This is your worst case scenario.
tonymontana
11-07-17, 15:42
For investors who have no concern about negative cash flow, obviously they have the ability to hold in perpetually.
There are many investors like that. In a way, I am somewhat like that as well. I consider it a safe place to park money and hedge against inflation. of course I didn't go batsh*t crazy and pay 2000psf for Jurong / Woodland / Yishun OCR lah. Anyway you do make valid points.
True. Recession comes also good, dont come also good.
tonymontana
11-07-17, 15:43
https://lifefitnessbydane.files.wordpress.com/2015/02/cuphalffull.jpg?w=830
Depends on how you see it, I see negative cash flow.
If I stay in HDB then positive Cash flow, but then how many 10 years do I have.
It is not how fast you start at a race to determine whether you win or not, it is the finish line that determines.
https://scontent-frt3-1.xx.fbcdn.net/v/t1.0-9/11070226_10204807877929693_3289811458906968265_n.jpg?oh=d36516d0c57c5fcdfac03278edf4395f&oe=59CFE04B
Wow so fat, was overweight by 10 kg then.
https://www.facebook.com/Diabetes-1071473759546520/
looking good! health and family, that's what's important. where is that? terrasse?
tonymontana
11-07-17, 15:46
One will surely need a place to stay as well.
Based on the addresses, I believe it is a better deal to rent out the HDB and stay in Terrasse penthouse (this kind needs a strata of people to appreciate).
The best immediate cash flow deal is to get the Govt Flexi-2rm and sell off everything else. But even Woods will not go for it if given a chance, unless really bopian.
Agree! I would also do the same thing - rent out HDB and enjoy terrasse.
I fully agreed with this. I am now working 3-days, min stress, good pay and with a long weekend....
Good work life balance..
cannot take full retirement life....
👍👍👍👍👍👍
My, retired coming to 3 years already and loving every day.
And pay obscene insurance premium (for something you shouldn't need in first place)? :banghead:
Buy 2 or 3 policies then
retired or not retired, still doing investment, so what is the difference for some people like us?
It is not like I retired and do nothing, don't invest, sleep and eat, eat and sleep??????
Anyway, retired or not, we should always be loving and enjoying our everyday............... :playful:
👍👍👍👍👍👍
My, retired coming to 3 years already and loving every day.
retired or not retired, still doing investment, so what is the difference for some people like us?
It is not like I retired and do nothing, don't invest, sleep and eat, eat and sleep??????
Anyway, retired or not, we should always be loving and enjoying our everyday............... :playful:
👍👍👍👍👍👍👍
Must always enjoy. YOLO
Amber Woods
11-07-17, 18:13
Agree! I would also do the same thing - rent out HDB and enjoy terrasse.
If you have a bank loan of $1.8m still outstanding at age 53 and planning to retire in 2019, I am not sure you can happily stay at the Terrasse to enjoy life when every month you have to come up cash from your pocket to support the lifestyle. In another word, you have not achieved financial independence yet.
Have you thought about how you are going to settle the $1.8m loan if you have to retire in two years time with not much cash other than your CPF minimum sum (hopefully)?
Wow! Wake up call? :drinking_coffee_ico
May be he has so much blind faith in some dead people that he thought these people will solve his coming problem? :playful:
If you have a bank loan of $1.8m still outstanding at age 53 and planning to retire in 2019, I am not sure you can happily stay at the Terrasse to enjoy life when every month you have to come up cash from your pocket to support the lifestyle. In another word, you have not achieved financial independence yet.
Have you thought about how you are going to settle the $1.8m loan if you have to retire in two years time with not much cash other than your CPF minimum sum (hopefully)?
anythingwhatever
11-07-17, 20:35
If you have a bank loan of $1.8m still outstanding at age 53 and planning to retire in 2019, I am not sure you can happily stay at the Terrasse to enjoy life when every month you have to come up cash from your pocket to support the lifestyle. In another word, you have not achieved financial independence yet.
Have you thought about how you are going to settle the $1.8m loan if you have to retire in two years time with not much cash other than your CPF minimum sum (hopefully)?
Don't worry about him lah, he has many options to play with, just cash out one of his multiple properties, problems solved. :)
Amber Woods
11-07-17, 21:35
Don't worry about him lah, he has many options to play with, just cash out one of his multiple properties, problems solved. :)
I was not referring to Arcachon. I am sure he is weighting his options now. I was referring to Tonymontana's response below.
Agree! I would also do the same thing - rent out HDB and enjoy terrasse.
tonymontana
11-07-17, 22:37
I was not referring to Arcachon. I am sure he is weighting his options now. I was referring to Tonymontana's response below.
My response was just to say "sit back and enjoy life". It's a general response. Arcachon seems happy, who am I to tell him / advise him otherwise. He's not my Brother! :p
https://www.youtube.com/watch?v=QgTHNpEHKKw
Sounds outdated to me........ This is already the new world lah! Better catch up with the time!
Keep looking at the rear mirror (or blind faith in some dead people) will get you no where!!!!!!!!!!!!!!
Sounds outdated to me........ This is already the new world lah! Better catch up with the time!
Keep looking at the rear mirror (or blind faith in some dead people) will get you no where!!!!!!!!!!!!!!
In the increasingly divided and decentralised world in the future. Sg has a natural born advantage of being a small sovereign country. This fact will not change. Some people see it has no future, I see the story has just began. When US and Europe paralized with refugees and wealthy people move to Sg, will u have a roof over your head?
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