2011 - OCR or CCR ?

[devilplate]

those that have chiong so much in 2010 will have a harder landing, so you know the answer liao. Chiong very fast and in large quantum (psf) will also fall harder if there is downturn.....

CCR chiong too much in 06-07 tats y now still havent breakeven?

[hopeful]

CCR chiong too much in 06-07 tats y now still havent breakeven?

Nature tends towards the mean.
Look at PPI chart for CCR,OCR and you will understand.
during recession, all will be the same.

[devilplate]

Nature tends towards the mean.
Look at PPI chart for CCR,OCR and you will understand.
during recession, all will be the same.

not same....CCR drop more last yr in terms of %

[ay123]

CCR chiong too much in 06-07 tats y now still havent breakeven?

i think so.....so cannot use 2007 peak as benchmark becos is was being pushed with nothing to support. when downturn, all super rich run tats why it drop so much

[hopeful]

not same....CCR drop more last yr in terms of %

You get it buy you don't get it.
CCR drop more because it rose more up.

The PPI for CCR,OCR will tend to converge (as in superimposed). it has been doing so. that's why 2006-2007 was an anomaly for CCR.
And now, nature will tends towards the mean.

[teddybear]

So OCR property price rise from $500 psf to $1000 psf got support from fundamental? Don't think so. Look that the top 20%-10% ranked earners. These are the ones buying OCR properties. Have their income/salary increased 100%? Nope, fat hope! Their income only increased by 10-20% but property prices gone up 100%! Ops! Car prices have gone up almost 100% as well and with rising education costs, food costs, etc, these group of people are now being squeezed on both ends. We just need interest rate to increase and you will see a lot of pins dropping......................
Those buying new launches better watched out! If resale price cannot even be supported by fundamentals, let alone these new launch properties priced at 25% to 50% above resale price!
May I say OCR price is an anomaly in 2009-2010? We will see regression back to fundamentals 2-5 years down the road.

i think so.....so cannot use 2007 peak as benchmark becos is was being pushed with nothing to support. when downturn, all super rich run tats why it drop so much

[hopeful]

i think so.....so cannot use 2007 peak as benchmark becos is was being pushed with nothing to support. when downturn, all super rich run tats why it drop so much

Please don't equate the big drop with lots of buying opportunities.
it drop so much but you won't see lot of firesales or volume.

As in stock trading, if small volume, a few outliers will cause the PPI for CCR to drop.

So no, super rich don't run, they have holding power. Please adjust your mindset.

[devilplate]

Please don't equate the big drop with lots of buying opportunities.
it drop so much but you won't see lot of firesales or volume.

As in stock trading, if small volume, a few outliers will cause the PPI for CCR to drop.

So no, super rich don't run, they have holding power. Please adjust your mindset.

last yr, definitely can find more CCR firesale....my own experience...no proof

[devilplate]

both segment i wun touch actually....stocks better

[hopeful]

last yr, definitely can find more CCR firesale....my own experience...no proof

just check volume of transactions during 2007-2010.
For property, when it is downturn, price goes down but volume is also down.
when upturn, price goes up and volume goes up.
That's the magic of property investment.

The worse case if economy go south and mortgage rates goes north, even then volume of property transactions will be low.
Who will buy the firesales? Banks will be very conservative in a downturn.
And if banks repossessed and auction, who will buy if no financing?

BTW, when banks repossessed, is it considered a transaction? as in banks pay stamp duty etc to show that bank is now the legal owner? Does it show in URA?

[bargain hunter]

i am also not adding to ppty exposure. new funds buy stocks better. if forumers here are comparing OCR and CCR vs their 2007 highs what about stocks? sti > 20% up then will reach 2007 high. individual stocks likely even at further discount. of course this is only a simplistic comparison. someone said maybe buyers of ppties now made a windfall from stock market but i thought its the reverse? its the ppty market which has been outperforming for years.

both segment i wun touch actually....stocks better

[kingkong1984]

http://lushhomemedia.com/2010/12/17/...omes-analysts/

[teddybear]

Stocks will not get as high return as properties consistently over a long period of >10 years. Many companies that are high-flyers or people's blue-eye boys are either long gone or prices going no where. For properties, hold long long sure make money. The same is not true for stocks. Stocks are fraud with very risks that are totally out of our control (not like properties, you can see, touch, smell, know what is going on in the estate and their surroundings and hence assess their value. Not so easy for stocks! Stocks can be easily manipulated, both in term of prices, their financial statements etc whereas properties have no such problems). Thread with care!

i am also not adding to ppty exposure. new funds buy stocks better. if forumers here are comparing OCR and CCR vs their 2007 highs what about stocks? sti > 20% up then will reach 2007 high. individual stocks likely even at further discount. of course this is only a simplistic comparison. someone said maybe buyers of ppties now made a windfall from stock market but i thought its the reverse? its the ppty market which has been outperforming for years.

[hopeful]

http://lushhomemedia.com/2010/12/17/...omes-analysts/

I just love their reasoning.
Yet, deals above $4,000 psf are still rare. Analysts say that this shows the luxury segment still has room for capital appreciation.
..........
Investors are still not paying top dollar for extra exclusivity – a sign that they have been cautious on luxury homes in the current property cycle. Prices of mass-market homes, meanwhile, have already surpassed their 2007 peaks.
Even then, analysts say it’s only a matter of time before prices of luxury properties catch up with – and exceed – their 2007 peak.

so just because CCR has not exceed peak, so it will exceed peak, only a matter of time but don't know when....

It doesn't take much IQ to be a property analyst in Singapore?

[ay123]

I just love their reasoning.
Yet, deals above $4,000 psf are still rare. Analysts say that this shows the luxury segment still has room for capital appreciation.
..........
Investors are still not paying top dollar for extra exclusivity – a sign that they have been cautious on luxury homes in the current property cycle. Prices of mass-market homes, meanwhile, have already surpassed their 2007 peaks.
Even then, analysts say it’s only a matter of time before prices of luxury properties catch up with – and exceed – their 2007 peak.

so just because CCR has not exceed peak, so it will exceed peak, only a matter of time but don't know when....

It doesn't take much IQ to be a property analyst in Singapore?

everyone can be the "expert". juz use last paek/low to predict the next peak/low. since last year they have been saying prime has room to grow becos is xx% below peak....but does it come trur??? their expert view really insult our IQ

[ay123]

Stocks will not get as high return as properties consistently over a long period of >10 years. Many companies that are high-flyers or people's blue-eye boys are either long gone or prices going no where. For properties, hold long long sure make money. The same is not true for stocks. Stocks are fraud with very risks that are totally out of our control (not like properties, you can see, touch, smell, know what is going on in the estate and their surroundings and hence assess their value. Not so easy for stocks! Stocks can be easily manipulated, both in term of prices, their financial statements etc whereas properties have no such problems). Thread with care!

the "red" sound like the propertism god Jlrx.......are u HIM???

[bargain hunter]

yup, i agree. stocks are not for everyone. cannot buy the wrong stock.

Stocks will not get as high return as properties consistently over a long period of >10 years. Many companies that are high-flyers or people's blue-eye boys are either long gone or prices going no where. For properties, hold long long sure make money. The same is not true for stocks. Stocks are fraud with very risks that are totally out of our control (not like properties, you can see, touch, smell, know what is going on in the estate and their surroundings and hence assess their value. Not so easy for stocks! Stocks can be easily manipulated, both in term of prices, their financial statements etc whereas properties have no such problems). Thread with care!

[hopeful]

everyone can be the "expert". juz use last paek/low to predict the next peak/low. since last year they have been saying prime has room to grow becos is xx% below peak....but does it come trur??? their expert view really insult our IQ

The thing is they are paid to do so.....

so let me make my stand clear on CCR and OCR.
The gap will converge.
CCR will be relatively stagnant.
OCR will inch upwards to close the gap with CCR in the PPI chart.
Hopefully it comes true, then those people in real estate agencies will be wowed by my brilliant insights and I can apply for a job as an analyst there and apply for PR

[gn108]

Property does show consistent returns over any 10 yr period but it tends to be less liquid and more a leverage option.

I prefer a blend of property, stocks, and cash.
Stocks have it;s own attraction, dividend yield can be better than property, liquid and not so differentiated as property. (No need to check if there are leaks, facing, crack, reno, high/low floor, near this or that, deal with agents). If you know what you're doing, it;s much less troublesome and more than equally rewarding.

[teddybear]

What PPI chart? Those chart are pretty useless to compare between CCR and OCR. Why not you state in terms of $PSF easier for us to understand your stand and see whether you are right or wrong 2-3 years down the road?

The thing is they are paid to do so.....

so let me make my stand clear on CCR and OCR.
The gap will converge.
CCR will be relatively stagnant.
OCR will inch upwards to close the gap with CCR in the PPI chart.
Hopefully it comes true, then those people in real estate agencies will be wowed by my brilliant insights and I can apply for a job as an analyst there and apply for PR

[hopeful]

What PPI chart? Those chart are pretty useless to compare between CCR and OCR. Why not you state in terms of $PSF easier for us to understand your stand and see whether you are right or wrong 2-3 years down the road?

Even now, condos in CCR psf range from 900-5000.
OCR range is albeit smaller as I dont foresee OCR hitting 4000psf.

How to state using PSF? which condos to benchmark etc?
What is the methodology you proposed?

[mantrix]

I just love their reasoning.
Yet, deals above $4,000 psf are still rare. Analysts say that this shows the luxury segment still has room for capital appreciation.
..........
Investors are still not paying top dollar for extra exclusivity – a sign that they have been cautious on luxury homes in the current property cycle. Prices of mass-market homes, meanwhile, have already surpassed their 2007 peaks.
Even then, analysts say it’s only a matter of time before prices of luxury properties catch up with – and exceed – their 2007 peak.

so just because CCR has not exceed peak, so it will exceed peak, only a matter of time but don't know when....

It doesn't take much IQ to be a property analyst in Singapore?

Yup exactly my point - doesn't mean just becos it's a peak it has to be always surpassed.

[teddybear]

Up to you lah, just some condos with sufficient number of units and transactions to benchmark. E.g. the 338 units Carabelle as representative of OCR, 486 units Park Infinia as representative of CCR?
You think Carabelle will transact at almost same price as Park Infinia since you said CCR will stagnant and OCR will rise to converge with CCR?

Even now, condos in CCR psf range from 900-5000.
OCR range is albeit smaller as I dont foresee OCR hitting 4000psf.

How to state using PSF? which condos to benchmark etc?
What is the methodology you proposed?

[devilplate]

Up to you lah, just some condos with sufficient number of units and transactions to benchmark. E.g. the 338 units Carabelle as representative of OCR, 486 units Park Infinia as representative of CCR?
You think Carabelle will transact at almost same price as Park Infinia since you said CCR will stagnant and OCR will rise to converge with CCR?

lets monitor after 1yr lor...park infinia around 1800psf and carabelle around 950-1kpsf....almost half....lets see converge or widen

both i WUN touch now

[hopeful]

Up to you lah, just some condos with sufficient number of units and transactions to benchmark. E.g. the 338 units Carabelle as representative of OCR, 486 units Park Infinia as representative of CCR?
You think Carabelle will transact at almost same price as Park Infinia since you said CCR will stagnant and OCR will rise to converge with CCR?

Haha, why not use International Plaza/People Park versus Carabelle.

I am not saying that Carabelle will transact at the same price as Park Infinia.
I am refering is to PPI chart, as a whole, PPI OCR and CCR will converge again. Just because they converge doesn't mean they are at the same price.
I think there were a few posting on URA PPI index and on what they meant.
base year was 1998, both start at 100.

[teddybear]

Reasons: we have to compare apple to apple since the 2 you quoted are too different to compare because:
1) People Park is "Apt" with almost 0 facility; Carabelle is "Condo".
2) PP is 99LH; Carabelle is 999LH.
3) PP is too old (TOP 1970); Carabelle TOP 2008(?)
Another thing, I don't usually include D1 in CCR. I prefer to use only historical D9, D10, & D11 as CCR. Soon, you will see D14 also labelled as CCR (more to become labelled as CCR in future to justify selling sky-high prices to you!).
So How to compare like that?
Forget about those PPI since they can't be compared across different kinds of PPI. How to compare PPI_OCR vs PPI_CCR? Just by looking at the index can't even give you a clue about the actual $PSF value and you can't make much use of them except to see some historical trend within CCR or OCR but not compare across.

Haha, why not use International Plaza/People Park versus Carabelle.

I am not saying that Carabelle will transact at the same price as Park Infinia.
I am refering is to PPI chart, as a whole, PPI OCR and CCR will converge again. Just because they converge doesn't mean they are at the same price.
I think there were a few posting on URA PPI index and on what they meant.
base year was 1998, both start at 100.

[hopeful]

......
Forget about those PPI since they can't be compared across different kinds of PPI. How to compare PPI_OCR vs PPI_CCR? Just by looking at the index can't even give you a clue about the actual $PSF value and you can't make much use of them except to see some historical trend within CCR or OCR but not compare across.

What can be deduced just by looking from PPI graphs?
1) PPI CCR 2010 has not exceeded Peak PPI CCR 2007.
2) PPI OCR 2010 has exceeded Peak PPI OCR 2007.
3) comparing the gap between PPI CCR and OCR in 2007 versus 2010, the gap has narrowed.

What does that tell us?
1) OCR as a whole is rising faster than CCR, (but don't know which property)
which is confirmed on the ground as many forummers here will attest.
2) CCR as a whole has not yet reached the peak of 2007.
which is confirmed on the ground as many forummers here will attest also.

for simplicity sake, a 20% increase in PPI for both CCR and OCR.
OCR increase from 800 to 960 - a 160psf increase.
CCR increase from 3000 to 3600 - a 600psf increase.
The psf gap has increase from 2200 to 2640psf.
But the gap in PPI is still the same.

which one is more easily achieved?
so CCR have to increase by 600 just to maintain the same gap as OCR.
if instead CCR increase by 300 only, 10%. the psf gap between CCR and OCR will still increase but narrowing ie from initial 2200 to 2340.
But the gap in PPI is narrowing.

[teddybear]

The issue with these PPI is: who determine the base price to be used for building the PPI? Imagine I change the base now to 2010 Dec, what will happened? As I said, they are useful just for looking at trend, and not to compare across different PPIs since both have different base prices. Changing the base prices makes a lot of difference. That is how clever people use "statistics" to let others see what they want to see. So either you are the clever ones wanting people to see just what you want others to see by wanting people to just compare the PPIs or you are the opposite.

What can be deduced just by looking from PPI graphs?
1) PPI CCR 2010 has not exceeded Peak PPI CCR 2007.
2) PPI OCR 2010 has exceeded Peak PPI OCR 2007.
3) comparing the gap between PPI CCR and OCR in 2007 versus 2010, the gap has narrowed.

What does that tell us?
1) OCR as a whole is rising faster than CCR, (but don't know which property)
which is confirmed on the ground as many forummers here will attest.
2) CCR as a whole has not yet reached the peak of 2007.
which is confirmed on the ground as many forummers here will attest also.

for simplicity sake, a 20% increase in PPI for both CCR and OCR.
OCR increase from 800 to 960 - a 160psf increase.
CCR increase from 3000 to 3600 - a 600psf increase.
The psf gap has increase from 2200 to 2640psf.
But the gap in PPI is still the same.

which one is more easily achieved?
so CCR have to increase by 600 just to maintain the same gap as OCR.
if instead CCR increase by 300 only, 10%. the psf gap between CCR and OCR will still increase but narrowing ie from initial 2200 to 2340.
But the gap in PPI is narrowing.

[hopeful]

The issue with these PPI is: who determine the base price to be used for building the PPI? Imagine I change the base now to 2010 Dec, what will happened? As I said, they are useful just for looking at trend, and not to compare across different PPIs since both have different base prices. Changing the base prices makes a lot of difference. That is how clever people use "statistics" to let others see what they want to see. So either you are the clever ones wanting people to see just what you want others to see by wanting people to just compare the PPIs or you are the opposite.

PPI is not determined by me by the way so no, I am not one of the clever ones wanting people to see just what I want others to see.
PPI from NUS base year is 2000. PPI from URA 1998.
In fact, if base year is change every year, then the indice has relatively no value.

[hopeful]

Does anybody here question how they calculate STI index, whether the companies are representative of the stock market as a whole, or sectors like Manufacturing, Finance etc. Do we trust them or do we not?

Why then do we question the validity of PPI data?