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Thread: Did Mah consult developers?

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    Default Did Mah consult developers?

    Saturday December 31, 2011
    Developers – the real landlords
    Insight Down South
    By SEAH CHIANG NEE
    Developers – the real landlords

    As a group, exclusive and rich, property developers have always wielded strong influence in small cities with rich land banks in a scale that probably rivals the government – until now.

    TRADITIONALLY, property developers in cities like Singapore and Hong Kong have enjoyed economic power far beyond their numbers.

    We were politely reminded of this when Singapore’s developers told the government they were disappointed at not being consulted before it announced recent measures to cool the market.

    This was tantamount to a right to be informed in advance of any policy or price affecting their interests.

    The developers’ reaction stirred public ire, with people considering it an audacity its demand to be consulted over changes.

    Yet there is a tradition behind the demand.

    As a group, exclusive and rich, developers have always wielded strong influence in small cities with rich land banks in a scale that probably only rivals the government.

    After all it controls the city’s most precious asset.

    My first lesson of this fact of life came in the 1970s when I arrived to take up the post as news editor of The Hong Kong Standard. A colleague asked who I thought were the colony’s most powerful people.

    “The chief editor of New China News Agency” I ventured, regurgitating what I had often read.

    “No, my friend, not even the Chinese mainlanders, and not the colonials,” he exclaimed, “It is the Hong Kong real estate developers.”

    Land auctions often decided how well - or poorly – the Hong Kong people were to live.

    Property prices would affect billions in budgets and living standards, in other words, people’s lives.

    When I returned to Singapore, I found a little of the same, the difference being we were an independent country and not led by a passive colonial Governor. In short, developers here were powerful!

    Once land values were decided auctions, the developers controlled the ultimate prices and timing of the sales.

    To a large extent, it meant controlling of supply and demand.

    If the developers thought the asking prices were too high, they would abstain from bidding, making them a sort of a little “pressure group”.

    When I returned here I discovered a bit of the same.

    Developers collectively could – if they chose to - influence the way the media reported the property market because they were big advertisers.

    The bigger the spenders, the greater the influence! They could ensure newspaper reports did not report too negatively on the market and scare away buyers.

    Some were not reticent exercising it by making it clear to advertising managers that their money could best be used in a media that keep encouraging property buyers, or at least not to predict weak markets too strongly.

    Others stayed away from the game.

    Many years ago when I was chief editor of a newspaper here I had one such run-in with several Singapore developers, who were among my paper’s frequent advertisers.

    It was at a time when dark economic clouds were gathering and our Business Desk was reporting that property markets were heading for a fall. The bad vibes were strong, and they were reflected in our coverage.

    During lunch, one developer referred to how much his company had spent on advertising in our paper.

    He added that he “sometimes considered it a waste of money to advertise in a newspaper which frequently talked down the market”.

    If this continued, they might as well stop or cut down advertising in the paper, he said.

    I was very concerned. I replied that as a newspaper editor, I feared two things most; the government withdrawing the newspaper licence and secondly, businessmen threatening to withhold advertising unless we cooperated with them.

    “In either case, our survival will be threatened, and we will bring the fight to Page One and let readers judge!”

    We finally struck a deal: No advertising boycotts. In return I would run an interview on record with a property tycoon who predicted his views that the market would rise in the following year.

    I am relating this to record appreciation of the National Development Minister Khaw Boon Wan’s stand not to bend to the developers’ will “by consulting” them about market “cooling-off” action or price movements.

    That would have been tantamount to tipping them off in advance of price-sensitive measures, an act no government can do.

    Analysts expect the recent measures to cool buying and bring down the home prices by between 15 to 30% over the next two years.

    “There will be a sell-off in the next three-to-five months,” said a property agent.

    By imposing stiff measures against foreigners’ speculative buying, including a 10% duty, Khaw has gained public acclaim.

    “Khaw has my full support. His policy is good for the younger generation,” a Singaporean commented.

    “If the young people feel that even with hard work they still cannot achieve their goal, Singapore is done for. That dream is to own a private property.”

    Khaw has also succeeded in shortening the queue of new Singaporean graduates applying to own their first public flat.

    Since becoming minister after the May election, Singapore’s once world-acclaimed public housing is slowly working to dispel public discontent over shortage and high prices.

    Many more years are needed to clean up the mess. But for now, wrote Khaw - one of the more popular ministers: “We’re starting to see the light at the end of the tunnel”.

    And instead of the usual brickbats, praises are starting to come in for fending off foreign speculators.

    “I’m seeing the quality of Minister Khaw,” one surfer wrote.

    Another said: “Thank you for the cooling measures. This shows Singapore is clean and NOT controlled by the (property) billionaires club.”

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    If he did, he should be investigated thoroughly for any corruption, conflict of interest, etc. at the expense of Singaporeans. ****ing bastard.

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    Quote Originally Posted by orange
    If he did, he should be investigated thoroughly for any corruption, conflict of interest, etc. at the expense of Singaporeans. ****ing bastard.


    He already bye bye shake leg liao, every month just collect pension from taxpayers for life!

    Can investigate meh?

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    Quote Originally Posted by orange
    If he did, he should be investigated thoroughly for any corruption, conflict of interest, etc. at the expense of Singaporeans. ****ing bastard.
    Under his rule, all hdb owners laughing to the banks, where got at the expense of Singaporeans?

    Under the new rulership, only a minority of Singaporeans benefit leh

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    Quote Originally Posted by Allthepies
    Under his rule, all hdb owners laughing to the banks, where got at the expense of Singaporeans?

    Under the new rulership, only a minority of Singaporeans benefit leh
    Ya. The loud mouthed, pampered, demanding and internet savvy ME generation...

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    The remaining 10% who don't owned any properties yet or wanting to buy more, shouting and screaming for property prices to crash >50% so that they can buy cheap cheap? Seems like policy has been enacted to help them achieve their aim!

    Quote Originally Posted by Allthepies
    Under his rule, all hdb owners laughing to the banks, where got at the expense of Singaporeans?

    Under the new rulership, only a minority of Singaporeans benefit leh

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    Quote Originally Posted by teddybear
    The remaining 10% who don't owned any properties yet or wanting to buy more, shouting and screaming for property prices to crash >50% so that they can buy cheap cheap? Seems like policy has been enacted to help them achieve their aim!
    maybe good time for those who do not own property or buy for own stay. But I do not think anyone with more than 1 property now wants to buy anymore. It will be irrational if you buy more and more hoping to make the same kind of profits during the last 10 years.

    simple calculation... just add all the duties selling and buying up and see for yourself...any profits go straight into Lion City's treasure chest.

    My humble suggestion is : take your own sweet time la IF you still insist on buying lor..CM5 is like a major road block on the expressway.

    Any developer who wants to absorb any taxes or duties is going to sabo themselves later on... dun say I never warn first hor.

    Good Luck.

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    Quote Originally Posted by blackjack21trader
    maybe good time for those who do not own property or buy for own stay. But I do not think anyone with more than 1 property now wants to buy anymore. It will be irrational if you buy more and more hoping to make the same kind of profits during the last 10 years.

    simple calculation... just add all the duties selling and buying up and see for yourself...any profits go straight into Lion City's treasure chest.

    My humble suggestion is : take your own sweet time la IF you still insist on buying lor..CM5 is like a major road block on the expressway.

    Any developer who wants to absorb any taxes or duties is going to sabo themselves later on... dun say I never warn first hor.

    Good Luck.
    True. But I feel CM5 is more like a tight slap to developers to wake up their idea. With lower bids and fairer prices, the govt just want to ensure that supplies get absorbed eventually by 2015 for a stable market. It is also a clever tactic to get Singaporean first time owners to lose confidence in private and switch to public housing, in the end bto, dbss and ecs will be fully sold by 2016 so elections they will not be accused of creating excess supply.

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    Post cm5 soho will still be hot, the more u dun want ppl to buy, they buy even more, now my expectation about cm5 bring down OCR price is reversed, hdb resale 900k will lead OCR condo to another new high, land bid will moderate but price won't come down, next time max 1+s @ 1500psf is the norm
    Ride at your own risk !!!

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    Quote Originally Posted by phantom_opera
    Post cm5 soho will still be hot, the more u dun want ppl to buy, they buy even more, now my expectation about cm5 bring down OCR price is reversed, hdb resale 900k will lead OCR condo to another new high, land bid will moderate but price won't come down, next time max 1+s @ 1500psf is the norm
    Bro, bulls like you make me feel happy lor....I will only hear the good stuff....haha!

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    i frankly do not want a price rocket. stabilise at this level,rise a bit or DROP more is ok. Another price rocketing is going to bring many problems to the developers, not anyone else..my morning bird says so hor....dun quote me.

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    CM5 seems like to discourage buying private so that most buyers will go to buy BTO & DBSS & ECs to soak up all their supply so that they huat ah! otherwise, you can expect another round of gluts in HDB flats in future. People just have forgotten that HDB prices go no where or even down slowly from 1998-2006 (9 long years!).
    However, i don't follow what they want me to do. Previously, they encourage people to study IT, then few years later IT burnt & many out of jobs & can't find jobs for long time. Then they supply loads of HDB & encourage people to buy & resulted in HDB price effect from 1998-2006. You wanna follow what they want you to do? Think long & hard first!

    Quote Originally Posted by Eastboy
    True. But I feel CM5 is more like a tight slap to developers to wake up their idea. With lower bids and fairer prices, the govt just want to ensure that supplies get absorbed eventually by 2015 for a stable market. It is also a clever tactic to get Singaporean first time owners to lose confidence in private and switch to public housing, in the end bto, dbss and ecs will be fully sold by 2016 so elections they will not be accused of creating excess supply.

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    The moral of the story: never ever depend on the government; it is essential to have one's own observations and analysis of trends and environmental changes, and act on them instead of following the herd.

    Quote Originally Posted by teddybear
    CM5 seems like to discourage buying private so that most buyers will go to buy BTO & DBSS & ECs to soak up all their supply so that they huat ah! otherwise, you can expect another round of gluts in HDB flats in future. People just have forgotten that HDB prices go no where or even down slowly from 1998-2006 (9 long years!).
    However, i don't follow what they want me to do. Previously, they encourage people to study IT, then few years later IT burnt & many out of jobs & can't find jobs for long time. Then they supply loads of HDB & encourage people to buy & resulted in HDB price effect from 1998-2006. You wanna follow what they want you to do? Think long & hard first!

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    Quote Originally Posted by blackjack21trader
    i frankly do not want a price rocket. stabilise at this level,rise a bit or DROP more is ok. Another price rocketing is going to bring many problems to the developers, not anyone else..my morning bird says so hor....dun quote me.
    u say so bcoz u r developer?

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    Quote Originally Posted by samsara
    The moral of the story: never ever depend on the government; it is essential to have one's own observations and analysis of trends and environmental changes, and act on them instead of following the herd.
    after cm4 and 5, u still buying?

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    Price crash 50% in 1998
    Price crash 30% in 2008
    So even property market crash in 2012, how much will it be?
    should be less then 20%.

    GE2016...Government got 4yrs time to ensure everyone get a house,and made as many people happy as possible.
    But it will never take the Risk crash the property market, as it will make 80% of people very upset. Which country government in the world will do that? China? not really too, it punish the developer and specactor , but it gain support from it people on the policy.

    so any Singaporean complain CM1-CM5?
    Those who complain, you know why, as their profit are affected now

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    Some of the political risks in Singapore that we had talked before are beginning to materialise. I have rebalanced my portfolio over the last couple of months, reducing exposure in commercial properties (3 down to 1) and residential (5 down to 2, still holding one landed as hedge).

    Freed up 80% cash for re-deployment, doing research for select U.S. and Malaysia properties now. Any insights to share in these two countries?

    Quote Originally Posted by devilplate
    after cm4 and 5, u still buying?

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    Quote Originally Posted by TMATT

    GE2016...Government got 4yrs time to ensure everyone get a house,and made as many people happy as possible.
    But it will never take the Risk crash the property market, as it will make 80% of people very upset. Which country government in the world will do that? China? not really too, it punish the developer and specactor , but it gain support from it people on the policy.

    so any Singaporean complain CM1-CM5?
    Those who complain, you know why, as their profit are affected now
    I think it maybe too simplistic to suggest that 80% of the people will be upset if property price crashes. This is just an assumption that about 80% of the households are owner occupiers and with probably quite a number of people having second properties for investments. We are assuming that any crash in prices will upset these people. However, looking at the issue harder, those with one property will not be affected by price crashing as long as they are not holding negative assets and having trouble with their banks. These people may be looking forward to buy their second property if price falls. The only people likely to be upset are those holding second or more properties and wanting to sell. They either miss the boat to sell earlier or holding on hoping for price to rise quickly again.

    With property prices at its 20-year peak now, I believe majority of the people be it one-property owners or investors should welcome a crash in property prices.

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    That is just wishful thinking. Pty prices will crash when euro tanks and recession comes. When that happens the marginal upgraders or 2nd pty investor want-to-bes will worry about the jobs, instead of pty buying. Without a crisis, existing owners have no reason to sell at loss. Remember this group are better off in the 1st place, as they had the capacity to take one more pties with even 70 or 60 % LTV. Ppl dun want to openly say so, but fact is, these group are the better off ones both in terms of career or investment.

    So for the existing group who aspire to upgrade, nothing changes really. Except that the gov is now taking on the role as developers for pte pty and is doing massive amount of ECs. This group can "upgrade" to EC. Although I'm sure after a few yrs ppl will realize EC becomes just another class below PC. So prime will remain as prime. Mass market better PCs will remain as "real" condos. And EC, are still semi public. Nothing changes. The "classes" of the society remain the same.

    What gov achieved with this CM is the perceived justice-done message. The majority of the 80%, who really have no intention to buy a condo anyway, are happy to see that foreigners and PRs and "the rich" are "being punished".

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    I'm most curious to know the impact of CM 5 on the rental market.

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    All these empty talk and wild assumptions of govt's intent on this and that about CM1-5 after GE and the fear of backlash in GE16, etc, etc... are just that, talk... come on, GE16 is 4 years to come, lets first worry for 2012.


    Do you think CM5 would have come if not because of what is happening outside of Singapore?

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    Ha ha ha! Another justification for why is good for property market to crash?
    Well, even assuming all buyers are owners-occupiers and they have 1 property only, they will not want to see increase in property prices and not crash for following reasons:
    1) When property prices crash, it means economy bad, many people probably also end up with no jobs and small business owners and self-employed's incomes may dropped to close to zero, and might not even have cash flow to pay instalments.
    2) When 1 happens, they may default on loan payments, and end up having their properties forced sold, worse at the bottom of the crash, bearing all loses for being sold at lowest price and no roof over head
    3) When property prices crash, people default, properties get forced sold, banks will have to take real loses to their balance sheet, bank stocks crash, employers want cash and not stock options! Banks in deep shit as well.
    4) Banks in deep shit, don't want to lend to small companies and businesses, many of these companies will go bankcrupt, accelerating (2) & (3).
    5) When (1)-(4) accelerates, Singapore economy will end up in very deep shit as well.

    So how can property prices crash be good for Singapore!!!


    Quote Originally Posted by Leeds
    I think it maybe too simplistic to suggest that 80% of the people will be upset if property price crashes. This is just an assumption that about 80% of the households are owner occupiers and with probably quite a number of people having second properties for investments. We are assuming that any crash in prices will upset these people. However, looking at the issue harder, those with one property will not be affected by price crashing as long as they are not holding negative assets and having trouble with their banks. These people may be looking forward to buy their second property if price falls. The only people likely to be upset are those holding second or more properties and wanting to sell. They either miss the boat to sell earlier or holding on hoping for price to rise quickly again.

    With property prices at its 20-year peak now, I believe majority of the people be it one-property owners or investors should welcome a crash in property prices.

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    Quote Originally Posted by teddybear
    Ha ha ha! Another justification for why is good for property market to crash?
    Well, even assuming all buyers are owners-occupiers and they have 1 property only, they will not want to see increase in property prices and not crash for following reasons:
    1) When property prices crash, it means economy bad, many people probably also end up with no jobs and small business owners and self-employed's incomes may dropped to close to zero, and might not even have cash flow to pay instalments.
    2) When 1 happens, they may default on loan payments, and end up having their properties forced sold, worse at the bottom of the crash, bearing all loses for being sold at lowest price and no roof over head
    3) When property prices crash, people default, properties get forced sold, banks will have to take real loses to their balance sheet, bank stocks crash, employers want cash and not stock options! Banks in deep shit as well.
    4) Banks in deep shit, don't want to lend to small companies and businesses, many of these companies will go bankcrupt, accelerating (2) & (3).
    5) When (1)-(4) accelerates, Singapore economy will end up in very deep shit as well.

    So how can property prices crash be good for Singapore!!!
    Property prices crash may not be good for Singapore and minority of property owners. However, it brings down the cost of living and provides opportunity for many to get the properties they would otherwise unable to do so. Economic growth comes in cycles just like property cycle. In fact, they are highly co-related. Therefore, if it comes, it comes and those who are prepared will be rewarded. As the saying goes, there exist opportunities in every crisis..

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    So the thought that's always in my mind is whether we are in a crisis or out of a crisis...

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    Actually other then developer, there one more group of people affected - Property Agent ...

    Cooling measure sure not welcome by them, as they got less business and earn less.

    Maybe KBW should "consult" Property Agent on the CM, as think Singapore got about 10,000 or 20,000 agent? it do affect a certain % of family.

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    Not true. Property prices crash is bad for:
    1) all property owners (>90% households in Singapore) who have no wish to buy another property.
    2) Property agents, who are mostly Singapore citizens.
    3) Banks.

    Property price crash is good only for a minority who:
    1) A small minority of Citizens who don't have property in Singapore and intending to buy 1.
    2) Especially good for foreigners and PRs who have mostly have not bought any property in Singapore and wanted to buy 1.
    2) Those rich people intending to buy more, especially foreigners (since foreigners are generally much richer!)

    In conclusion, creating property crash will only benefit foreigners, PRs with no properties, and rich people!

    Quote Originally Posted by Leeds
    Property prices crash may not be good for Singapore and minority of property owners. However, it brings down the cost of living and provides opportunity for many to get the properties they would otherwise unable to do so. Economic growth comes in cycles just like property cycle. In fact, they are highly co-related. Therefore, if it comes, it comes and those who are prepared will be rewarded. As the saying goes, there exist opportunities in every crisis..

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    Quote Originally Posted by teddybear
    Not true. Property prices crash is bad for:
    1) all property owners (>90% households in Singapore) who have no wish to buy another property.
    2) Property agents, who are mostly Singapore citizens.
    3) Banks.

    Property price crash is good only for a minority who:
    1) A small minority of Citizens who don't have property in Singapore and intending to buy 1.
    2) Especially good for foreigners and PRs who have mostly have not bought any property in Singapore and wanted to buy 1.
    2) Those rich people intending to buy more, especially foreigners (since foreigners are generally much richer!)

    In conclusion, creating property crash will only benefit foreigners, PRs with no properties, and rich people!
    Agree!!!!!!

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    [quote=samsara]Some of the political risks in Singapore that we had talked before are beginning to materialise. I have rebalanced my portfolio over the last couple of months, reducing exposure in commercial properties (3 down to 1) and residential (5 down to 2, still holding one landed as hedge).

    Freed up 80% cash for re-deployment, doing research for select U.S. and Malaysia properties now. Any insights to share in these two countries?[
    /quote]

    I am a Malaysian born in KL,perhaps we can share ideas related to properties in KL.

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    property crash does not bring the cost of living down. It may not bring fuel price, food price down, transport price, etc.

    It only bring inflation number down as property contributes 20% to inflation number. which is a big number. Don't be fooled again and again...

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    Quote Originally Posted by teddybear
    Not true. Property prices crash is bad for:
    1) all property owners (>90% households in Singapore) who have no wish to buy another property.
    2) Property agents, who are mostly Singapore citizens.
    3) Banks.

    Property price crash is good only for a minority who:
    1) A small minority of Citizens who don't have property in Singapore and intending to buy 1.
    2) Especially good for foreigners and PRs who have mostly have not bought any property in Singapore and wanted to buy 1.
    2) Those rich people intending to buy more, especially foreigners (since foreigners are generally much richer!)

    In conclusion, creating property crash will only benefit foreigners, PRs with no properties, and rich people!
    Have to agree with your analysis. However, we need to understand that it is the average Singaporeans that long to have a second property as investment are finding prices beyond their reach. This is evidence with the successful sale of MM units which despite the high cost (PSF wise). The rich foreigners or PRs (without property) will always be there regardless of the state of property price. It is the average Singaporeans that are upset because property prices have risen beyond their reach. This group may not be buying not because they are not wanting but they could no longer afford it. This is our average Singaporeans who can influence the fate of the next government.

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