No sign of rethink on property cooling rules

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No sign of rethink on property cooling rules

Consultants and developers feel the measures are here to stay for now

Published on Dec 13, 2014 1:03 AM

By Rennie Whang


ANYONE hoping that property cooling measures will be unwound soon will likely be disappointed, going by signals from the private and public sectors.

One the one hand, developer Hiap Hoe has been forced to buy units at some of its projects, including all 48 at Treasures on Balmoral, in the wake of the plunging demand.

On the other, the Government shows no sign of a U-turn, with various ministers reiterating that prices have yet to fall to any meaningful degree to warrant a rethink.

"We do not expect the prevailing cooling measures will be lifted any time soon," said a spokesman for Hiap Hoe, which earlier this week sold the Treasures on Balmoral flats to its parent company.

Consultants and developers say that measures addressing financial stability - the total debt servicing ratio (TDSR) - are here to stay. But if the market weakens further, there is expected to be calls for tweaking rules on taxation.

"TDSR is a measure targeted at ensuring prudence among citizens as it takes into account all types of outstanding debt; it's a good measure that will remain," said Mr Desmond Sim, CBRE research head for Singapore and South- east Asia.

The idea that cooling measures will be around for a while has been stated by several ministers - most recently Deputy Prime Minister Tharman Shanmugaratnam in October.

He said that "there is some distance to go in achieving a meaningful correction, after the sharp run-up in prices in recent years".

While Hiap Hoe's move to buy units at its projects - including Skyline 360° and Signature at Lewis - suggests that it would rather pay the Additional Buyer's Stamp Duty (ABSD) on these transactions than stump up Qualifying Certificate penalties, it appears to be a rare move for now.

"These are different times from the global financial crisis. We are still positive in terms of economic health, and the balance sheets of developers generally remain strong," said Mr Sim.

Developers are trying to cut holding costs while giving rebates and other incentives to move units but there are no distress sales, he said.

Teambuild Land director Richie Chew suggested revisions for the ABSD levied on Singaporeans and permanent residents purchasing second homes, whether as future homes or as investment. "The existing TDSR means they would not be going beyond what they can afford...Tweaking some of these measures would be ideal." Sales at its Singa Hills condo have been slow, he noted.

Developer CapitaLand said it believed the Government would review measures "in a timely manner."

"With a resilient economy and policies to support population and economic growth, demand outlook for new homes over the long term remains positive," a spokesman said.

R'ST Research director Ong Kah Seng suggested that it may also be timely to relook cooling measures for high-end or costlier residential properties, separating them from mass market private property.

"High sales and leasing activity in the high-end residential segment would place Singapore on the world map for investment-grade properties," he said.

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Whenever market dont expect things to happen, that mean things is going to happen.

OCR private property prices will need to crash >20% first before the govt will ever do anything right? :dog:

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Originally Posted by Ringo33

Whenever market dont expect things to happen, that mean things is going to happen.

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Originally Posted by teddybear

OCR private property prices will need to crash >20% first before the govt will ever do anything right? :dog:

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How is that even be possible for the entire OCR region to crash by 20%?
Stop dreaming lah.

Dreaming?
Fact is, price already falling quarter after quarter, now OCR falling much faster...........................
As long as govt don't tinkle with cooling measures, drop 20% here it comes! Places like Jurong probably will drop >30% because climbed too much because of too much hype....................

People will ask: Drop 30% wah, so what?
Yes, but they don't remember that e.g.: start from $1, climb 60% is $1.60.
BUT DROP 30% from $1.60 is back to $1.06!
Minus away stamp duties, and interest paid means already lose money!
Up and Down is not linearly comparable!

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Originally Posted by Ringo33

How is that even be possible for the entire OCR region to crash by 20%?
Stop dreaming lah.

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Don't think they want to see that happen in OCR.. Mostly are locals..

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Originally Posted by cnud

Don't think they want to see that happen in OCR.. Mostly are locals..

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Less well off foreigners have been buying into OCR.

It is not a matter of whether they want to see that happen or not, but whether their policies are effective or not to lower property prices systematically, whether they want to treat all fairly or not, and whether they want to do what is economically correct but not politically/populist correct or not... :greedy_dollars:

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Originally Posted by cnud

Don't think they want to see that happen in OCR.. Mostly are locals..

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Originally Posted by teddybear

It is not a matter of whether they want to see that happen or not, but whether their policies are effective or not to lower property prices systematically, whether they want to treat all fairly or not, and whether they want to do what is economically correct but not politically/populist correct or not... :greedy_dollars:

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This is not a monopoly game. It won't be totally fair or very fair, only generally fair. Govt just monitors overall indices, and it is enough work for many dedicated persons already. You seriously think they will equilibrate every region, despite each region being very heterogeneous to begin with? That kind of thoughts can only lead to disillusionment or disappointment.

Different policies affect different segments of the properties differently. The fact that policies implemented already crashed 1 segment while holding up another segment means that the policy/combination of policies is a failure and it does not work well! Simple as that isn't it? Need to explain more?

Ok, and if they just want to look at the overall price index, that is like a toad in the well looking up, and they are seeing that the property market is still very hot, and hence govt should not do anything until property price index crash by >30% because they have gone up by too much!!!!!!! Doing otherwise just because OCR drop a bit means, well, populist action? :glee:

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Originally Posted by Kelonguni

This is not a monopoly game. It won't be totally fair or very fair, only generally fair. Govt just monitors overall indices, and it is enough work for many dedicated persons already. You seriously think they will equilibrate every region, despite each region being very heterogeneous to begin with? That kind of thoughts can only lead to disillusionment or disappointment.

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Originally Posted by teddybear

Different policies affect different segments of the properties differently. The fact that policies implemented already crashed 1 segment while holding up another segment means that the policy/combination of policies is a failure and it does not work well! Simple as that isn't it? Need to explain more?

Ok, and if they just want to look at the overall price index, that is like a toad in the well looking up, and they are seeing that the property market is still very hot, and hence govt should not do anything until property price index crash by >30% because they have gone up by too much!!!!!!! Doing otherwise just because OCR drop a bit means, well, populist action? :glee:

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Only if we decide to think simply will things work so directly.

How do we account for the uneven fairness when property went up such that 10% for CCR was equivalent to 30% rise for OCR in terms of quantum?

How do we account for govt investment in infrastructure and growth in incomes?

Possible to be totally fair? I can understand your angst and frustration but what kind of policy can be made to make it fair?

This is not a question of fairness, but a question of whether you mean what you say?

If you want property price to drop to 2009 levels, and CCR has dropped to that level, but OCR has not, means policy is lobe-sided, a clear FAILURE, then they should do more to ensure that OCR falls to 2009 levels! Not wait and do nothing right?

If they just want to keep price stagnant, and the fact that CCR has crashed, while OCR has indeed stagnant, means policy is a clear FAILURE, then they better do something to correct it! Not wait and do nothing right?

So, the question now is: What they want? Why no further action? They don't value "fair treatment" principle? What about national pledge? they don't even remember? :tongue-new:

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Originally Posted by Kelonguni

Only if we decide to think simply will things work so directly.

How do we account for the uneven fairness when property went up such that 10% for CCR was equivalent to 30% rise for OCR in terms of quantum?

How do we account for govt investment in infrastructure and growth in incomes?

Possible to be totally fair? I can understand your angst and frustration but what kind of policy can be made to make it fair?

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Originally Posted by teddybear

This is not a question of fairness, but a question ofmight dr whether you mean what you say?

If you want property price to drop to 2009 levels, and CCR has dropped to that level, but OCR has not, means policy is lobe-sided, a FAILURE, then they should do more to ensure that OCR falls to 2009 levels! Not wait and do nothing right?

If they just want to keep price stagnant, and the fact that CCR has crashed, while OCR has indeed stagnant, means policy is a clear FAILURE, then they better do something to correct it! Not wait and do nothing right?

So, the question now is: What they want? Why no further action? They don't value "fair treatment" principle? What about national pledge? they don't even remember? :tongue-new:

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If we introduce new artificial measures to push down OCR to 2009 levels, CCR might further drop to 2006 levels. Not sure if that is what you desire. It's not difficult actually. Just reduce TDSR to 50%.

to help CCR, one way is to implement TDSR reduction to OCR only. Just like Cat A and Cat B COE. But the backlash of this approach will be huge, deviate even further from the directives of the national pledge.

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Originally Posted by teddybear

This is not a question of fairness, but a question of whether you mean what you say?

If you want property price to drop to 2009 levels, and CCR has dropped to that level, but OCR has not, means policy is lobe-sided, a clear FAILURE, then they should do more to ensure that OCR falls to 2009 levels! Not wait and do nothing right?

If they just want to keep price stagnant, and the fact that CCR has crashed, while OCR has indeed stagnant, means policy is a clear FAILURE, then they better do something to correct it! Not wait and do nothing right?

So, the question now is: What they want? Why no further action? They don't value "fair treatment" principle? What about national pledge? they don't even remember? :tongue-new:

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Anyway our ministers can always say they mean and were using 2009 PPI versus median household income ratio and hit that ratio in 2016 maybe. Policy overall intent and objective achieved. After that maybe reduce one or two CMs.

I am fine with whatever policies they implement or want to implement, as long as it is fair to all and aims to achieve same fair and equitable outcomes for all............

If the policy didn't work or work in 1 sector only BUT NOT all sectors, then introduce more policy to ensure that the other sectors fall in line with the affected sector or change the policy to relieve the unfair effect on just that 1 sector only...........

I am fine with that, even if CCR crash another 30% to bring OCR in line, but NOT OK when CCR crash 30% but OCR is still super high and they NOT doing anything about it. That makes us puzzle: they want property price to drop or not??????????? If yes, why no more action to cure OCR????????????

What backlash you talking about? You mean they only want to introduce populist policies and are afraid of backlash? Didn't they say they will on introduce policies that are good for the country and not just to please the people (i.e. no populist policy)? Or you are telling us that they no long practise introducing policies that are good for the country and NOT just to please majority of people? :doh:

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Originally Posted by Kelonguni

If we introduce new artificial measures to push down OCR to 2009 levels, CCR might further drop to 2006 levels. Not sure if that is what you desire. It's not difficult actually. Just reduce TDSR to 50%.

to help CCR, one way is to implement TDSR reduction to OCR only. Just like Cat A and Cat B COE. But the backlash of this approach will be huge, deviate even further from the directives of the national pledge.

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Originally Posted by teddybear

I am fine with whatever policies they implement or want to implement, as long as it is fair to all and aims to achieve same fair and equitable outcomes for all............

If the policy didn't work or work in 1 sector only BUT NOT all sectors, then introduce more policy to ensure that the other sectors fall in line with the affected sector or change the policy to relieve the unfair effect on just that 1 sector only...........

I am fine with that, even if CCR crash another 30% to bring OCR in line, but NOT OK when CCR crash 30% but OCR is still super high and they NOT doing anything about it. That makes us puzzle: they want property price to drop or not??????????? If yes, why no more action to cure OCR????????????

What backlash you talking about? You mean they only want to introduce populist policies and are afraid of backlash? Didn't they say they will on introduce policies that are good for the country and not just to please the people (i.e. no populist policy)? Or you are telling us that they no long practise introducing policies that are good for the country and NOT just to please majority of people? :doh:

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They installed a standard policy that had different impacts on different segments. I think is unavoidable.

Definitely better than non standard policies that are so adhoc. Very much like Malaysia policy.

Unavoidable?
Might as well admit that it is a failure!
Better think of a solution to solve the 2-class problem now instead of trying to shriek responsibility and act as though nothing happened! :scared-2:

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Originally Posted by Kelonguni

They installed a standard policy that had different impacts on different segments. I think is unavoidable.

Definitely better than non standard policies that are so adhoc. Very much like Malaysia policy.

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Originally Posted by teddybear

Unavoidable?
Might as well admit that it is a failure!
Better think of a solution to solve the 2-class problem now instead of trying to shriek responsibility and act as though nothing happened! :scared-2:

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If it makes you happier thinking that way... :)

Not what I think, but I am raising a FACT, that the policies implemented so FAR is a FAILURE! They have not achieved their purpose! They better do something about it!

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Originally Posted by Kelonguni

If it makes you happier thinking that way... :)

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OCR property is resilient because of government's rentless effort to decentralized singapore commercial and retail activities and this has made CCR property less special and exclusive as compared to 10 years ago.

Narrowing price gap between ccr and OCR will become a norm. So teddybear better learn to accept reality instead kidding yourself with bunch of lies and wrong info

Beware!
When you fall to the "fade" of pump-and-dump moving around the OCR districts, today JLD, next few year WLD, next time YLD, you will forever lose the "property game" and lose money! BEWARE! Don't be a CARROT HEAD!
If you smart enough, don't need me to spell out clearly you should understand now! :chuncky:

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Originally Posted by Ringo33

OCR property is resilient because of government's rentless effort to decentralized singapore commercial and retail activities and this has made CCR property less special and exclusive as compared to 10 years ago.

Narrowing price gap between ccr and OCR will become a norm. So teddybear better learn to accept reality instead kidding yourself with bunch of lies and wrong info

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Originally Posted by teddybear

Beware!
When you fall to the "fade" of pump-and-dump moving around the OCR districts, today JLD, next few year WLD, next time YLD, you will forever lose the "property game" and lose money! BEWARE! Don't be a CARROT HEAD!
If you smart enough, don't need me to spell out clearly you should understand now! :chuncky:

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When someone who got stuck in the little well from wrong side of CCR starts to speak you need to beware because many things she talk about are nothing but NONSENSE.

WLD?? YLD?? HAHAHA.... whats that?

WLD, YLD you don't know?
Wow!
Never mind, as long as most here understand will do! :pride:

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Originally Posted by Ringo33

When someone who got stuck in the little well from wrong side of CCR starts to speak you need to beware because many things she talk about are nothing but NONSENSE.

WLD?? YLD?? HAHAHA.... whats that?

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Originally Posted by teddybear

WLD, YLD you don't know?
Wow!
Never mind, as long as most here understand will do! :pride:

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I only know of a Jurong LAKE district.

Not sure what WLD and YLD you referring to. Perhaps you been stuck in the well from the wrong side of CCR for too long.