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Thread: 2011 National Day Rally Speech

  1. #1
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    Default 2011 National Day Rally Speech

    HDB income ceiling raise to 10K
    EC income ceiling raise to 12K

    How will this impact the Mass Market condo?

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    Quote Originally Posted by Jadey
    HDB income ceiling raise to 10K
    EC income ceiling raise to 12K

    How will this impact the Mass Market condo?
    CCR and OCR prices should continue to move up while OCR prices should remain or weaken in my opinion.

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    this will drive demand to hdb side even more.
    HDB price will continue to go up then. IF hdb price goes up, mass market can at least maintain...

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    Quote Originally Posted by Lovelle
    this will drive demand to hdb side even more.
    HDB price will continue to go up then. IF hdb price goes up, mass market can at least maintain...
    mass market may continue to inch up, especially those better locations

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    Quote Originally Posted by Jadey
    HDB income ceiling raise to 10K
    EC income ceiling raise to 12K

    How will this impact the Mass Market condo?
    New private prop must be priced at a higher gap than ECs.

    Government enticing buyers to go in EC segment to soak up demand.

    This addresses citizens' demand on income ceiling and also prompt developers to pause mass mkt launches in mean time.

    In short, those who bought new private props in last six mths at close to EC prices will benefit as new private mass mkt props should command a higher gap/premium.

    However, we might be seeing the last of new mass mkt launches with this measure as buyers seep into ECs.

    Whoever wants to buy new private prop will need to buy from existing launches who will steadily raise prices. Their way of attracting buyers will be through furniture discount vouchers or rebates to create price differentiation from EC segment yet maintaining the premium over ECs.

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    Quote Originally Posted by Lovelle
    this will drive demand to hdb side even more.
    HDB price will continue to go up then. IF hdb price goes up, mass market can at least maintain...
    will drive up demand ballot for new hdb, and reduce the demand in the resale hdb.

    if like that, resale hdb sellers can't ask for sky high cov, unable to upgrade to condos. condos will weaken??

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    Quote Originally Posted by jwong71
    will drive up demand ballot for new hdb, and reduce the demand in the resale hdb.

    if like that, resale hdb sellers can't ask for sky high cov, unable to upgrade to condos. condos will weaken??
    There is still shortage in resale mkt so COV will only slowly slowly come down as more new ballot flats come out.

    The income ceiling is controversial but it will definitely give demand for EC segment.

    The perception of solving or addressing the issue from government is there.

    Whether it works or not is another thing.

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    Quote Originally Posted by jwong71
    will drive up demand ballot for new hdb, and reduce the demand in the resale hdb.

    if like that, resale hdb sellers can't ask for sky high cov, unable to upgrade to condos. condos will weaken??
    bro, COV is max max 50-80k ba. Will affect upgrading to condo for 50k difference?

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    i agree with jwong71.. lets say there are 10 people in singapore.. When the ceiling was 8k BTo and 10k EC, maybe say 7 people qualify and buy them.. Now ceiling raised, BTO and EC cannibalised the demand from pte properties.. So, demand by right should drop, esp OCR..

    BTOs prices are controlled by HDB.. although demand will increase but HDB can still maintain the price for another 2-3 years (in fact some said the recent launch prices drop), while continuing to increase supply.. resale HDB will drop a bit, and the domino will go on..

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    Quote Originally Posted by DaytonaSS
    bro, COV is max max 50-80k ba. Will affect upgrading to condo for 50k difference?
    bro probably you yet to come to know some cov 100-120k transacted hdb.

    again,you can argue what is an 100-120k of difference, to you is not an issue.
    to some average upgradders it sure make a hell lot of difference, even an 50k

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    Quote Originally Posted by linchong84
    i agree with jwong71.. lets say there are 10 people in singapore.. When the ceiling was 8k BTo and 10k EC, maybe say 7 people qualify and buy them.. Now ceiling raised, BTO and EC cannibalised the demand from pte properties.. So, demand by right should drop, esp OCR..

    BTOs prices are controlled by HDB.. although demand will increase but HDB can still maintain the price for another 2-3 years (in fact some said the recent launch prices drop), while continuing to increase supply.. resale HDB will drop a bit, and the domino will go on..
    hdb current launch is cheaper by 40-50k, comparing to the previous launches.

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    Default 50K

    50K difference when used as 20% down payment will translate to 250K in total price. That is something for massive market condo!

    Thanks,
    Richard

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    Quote Originally Posted by jwong71
    will drive up demand ballot for new hdb, and reduce the demand in the resale hdb.

    if like that, resale hdb sellers can't ask for sky high cov, unable to upgrade to condos. condos will weaken??
    do u think new hdb will be priced lower ?

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    The income ceiling raised will only mean those priced out before can now enter.

    U have demand shifting from private back to EC and DBSS.

    Then if u have more DBSS and condo supply, the real impact would be at private.

    For those private that is subjected to SSD... Cannot do much till SSD is out.

    For those not subjected to SSD, they will realize that up graders or buyers will be less and less. Overall, DBSS and EC will save the day.

    Those who bought near EC prices need not be too happy as prices is going to be flat or downward from now on. Faster is external shock hit or recession hits.

    U need to watch the prices of new BTO, DBSS and EC to make your decision.

    Rental wise, good luck to u as Upgraders will compete with u with their HDB or dual key ECs.

    At this hdb supply rate, I wish OCR owners good luck.

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    Quote Originally Posted by Lovelle
    do u think new hdb will be priced lower ?
    i do not have to think that new hdb will be priced lower,
    BUT current launch(after GE) already priced lower than previous new launches that were released.(before GE)

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    Quote Originally Posted by kingkong1984
    Those who bought near EC prices need not be too happy as prices is going to be flat or downward from now on. Faster is external shock hit or recession hits.
    wrong!! those who buy near EC prices, are locked to SSD and prone to external shock, due soon in these few years. in a matter of time

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    wouldn't the developers cannibalize on the increase in income ceiling to 12k by increasing EC prices? if that happens n prices become close to mass market condos, wouldn't that again push up condo prices? assuming that S'pore survives relatively well in the economic roller coaster..

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    Quote Originally Posted by jwong71
    wrong!! those who buy near EC prices, are locked to SSD and prone to external shock, due soon in these few years. in a matter of time
    Hey, we are talking the same the lah...

    What is seen as a bargain buy earlier is based on past yardsticks, under néw yardstick, they are shorter... Hahahah...

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    Quote Originally Posted by gav108
    wouldn't the developers cannibalize on the increase in income ceiling to 12k by increasing EC prices? if that happens n prices become close to mass market condos, wouldn't that again push up condo prices? assuming that S'pore survives relatively well in the economic roller coaster..
    Possible but developers would keep quantum the same to target bigger pool of buyers.

    U raise EC prices, people go for DBSS or resale private. Developer cannot clear new stocks. Then eventually, have to cut price lor.

    It's red apples and green apples.

    EC are green apples, private condo are red apples, which one do u like to eat?

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    Quote Originally Posted by kingkong1984
    Possible but developers would keep quantum the same to target bigger pool of buyers.

    U raise EC prices, people go for DBSS or resale private. Developer cannot clear new stocks. Then eventually, have to cut price lor.

    It's red apples and green apples.

    EC are green apples, private condo are red apples, which one do u like to eat?

    meaning that the prices will stabilize, but actual psf will increase? i guess that's possible. since big developers need to balance and take into account the sales of all their developments, whether private or EC or DBSS. if they price EC too high, its sales may suffer. if they price their EC too low, their private developments may suffer.

    also, given that they have already bidded so high for recent GLS, don't think they will want to lower psf in order to maintain some profit margin.

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    Only way forward, cut size and max free areas....balconies and air con ledge. Planter no more....

    U have more mm and

    1 bedder 400 sqf
    2 bedder 750 sqf
    3 bedder 1000 sqf
    4 bedder 1250 sqf
    Penthouses 1500 sqf only.

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    New OCR prices may not drop much. Probably will come will more luxurious fittings and glitzy advertising to maintain price gap over EC. Resale OCR condos will suffer the most.

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    EC demand will probably not increase that much for two reasons.

    1. Those previously who don't qualify for BTO, ie. income from 8k to 10k, will now move to buy BTO and another group of buyers, ie income from 10k to 12k will buy EC. So the number balances. Furthermore, number of people who earns more decreases up the income bracket so there are probably less people in the 10k to 12k bracket than those between 8k and 10k.

    2. Developers will slowly and surely move prices of EC up to gain higher profits so the 8k to 10k buyers might be squeezed out in the EC market.

    Therefore, BTO will have higher take up rate while OCR mass market might suffer the most.

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    Quote Originally Posted by fclim
    New OCR prices may not drop much. Probably will come will more luxurious fittings and glitzy advertising to maintain price gap over EC. Resale OCR condos will suffer the most.
    This I agree. Purpose is to cool HDB resale and address income ceiling demand. Sales might be slow for new mass mkt but price gap with EC will have to maintain one way or another through innovative promo.

    Resale's salavation is more on it's size in sqft coz MM really small these days.

    People who make do with 1-bed now looking at 2-bed while former buyers of 2-bed look at 3-bed compact.

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    Quote Originally Posted by ysyap
    EC demand will probably not increase that much for two reasons.

    1. Those previously who don't qualify for BTO, ie. income from 8k to 10k, will now move to buy BTO and another group of buyers, ie income from 10k to 12k will buy EC. So the number balances. Furthermore, number of people who earns more decreases up the income bracket so there are probably less people in the 10k to 12k bracket than those between 8k and 10k.

    2. Developers will slowly and surely move prices of EC up to gain higher profits so the 8k to 10k buyers might be squeezed out in the EC market.

    Therefore, BTO will have higher take up rate while OCR mass market might suffer the most.
    Don't think 1. is likely. The pool of EC buyers are in general not keen on HDB lifestyle. You will be surprised how young people think these days. They are earning more and not afraid to live the "condo" lifestyle that EC give them even if they have to take a big loan.

    So the flow towards BTO from the 8-10k bracket won't be significant but the flow into EC from the 10-12k will be more significant because of SSD and lower EC pricing. But they also need to satisfying the 1st & 2nd time buyer criteria.

    Agree that developers will most likely up EC prices and that will cause private condo prices to firm too since more powerful FTs coming.... not forgetting more Mdm Lai types becoming citizens

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    Not sure how much impact by the new FTs on the buy/sell market. New FTs will not buy immediately. They will usually rent first given the housing allowance. It may applies to those who have stay here for a couple years and decided to stay on and not given housing allowance. This will be in the low-mid level management FTs.
    Quote Originally Posted by propbull1628
    Don't think 1. is likely. The pool of EC buyers are in general not keen on HDB lifestyle. You will be surprised how young people think these days. They are earning more and not afraid to live the "condo" lifestyle that EC give them even if they have to take a big loan.

    So the flow towards BTO from the 8-10k bracket won't be significant but the flow into EC from the 10-12k will be more significant because of SSD and lower EC pricing. But they also need to satisfying the 1st & 2nd time buyer criteria.

    Agree that developers will most likely up EC prices and that will cause private condo prices to firm too since more powerful FTs coming.... not forgetting more Mdm Lai types becoming citizens

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    Quote Originally Posted by propbull1628
    Don't think 1. is likely. The pool of EC buyers are in general not keen on HDB lifestyle. You will be surprised how young people think these days. They are earning more and not afraid to live the "condo" lifestyle that EC give them even if they have to take a big loan.

    So the flow towards BTO from the 8-10k bracket won't be significant but the flow into EC from the 10-12k will be more significant because of SSD and lower EC pricing. But they also need to satisfying the 1st & 2nd time buyer criteria.

    Agree that developers will most likely up EC prices and that will cause private condo prices to firm too since more powerful FTs coming.... not forgetting more Mdm Lai types becoming citizens
    Yeah... but the rising EC prices will simply force these young couples whose income is between 8k to 10k to reconsider their options. Doubtless to say some will still insist on living that condo lifestyle and so bleed themselves dry but some will opt out too, especially those with dependents such as young kids and aged parents. However, all things being equal, i.e. if the prices of EC remain the same as today, then these same group of couples will most like opt for condo lifestyle. Not many mdm lai around lah!

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    I think the Government's single mindedness in moderating the HDB mkt will actually work albeit not immediately. I guess the bigger question is the knock on effects on the private mkt. With a slowing economy but flush with liquidity.....who knows?

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    If your combine income fall into the range btw 10k to 12k, would u rather buy EC or private assuming that you can afford both? Which is a better bet? EC obviously. So those earning between 10k to 12k will not want to buy private. Think those 10-12k earners who can't qualify for EC previously and bought PC due to income ceiling will

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    Quote Originally Posted by Montaigne
    If your combine income fall into the range btw 10k to 12k, would u rather buy EC or private assuming that you can afford both? Which is a better bet? EC obviously. So those earning between 10k to 12k will not want to buy private. Think those 10-12k earners who can't qualify for EC previously and bought PC due to income ceiling will
    True true! Then again there are those who are turned off by the MOP. Especially investors! EC cannot rent out but PC can!

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