The real FACTS about Landed property

[proper-t]

There have been a lot of noise and pollution in this forum recently started by charlatans and people with ulterior motives so I thought now would be a good time to lay out all the facts for forumers here to digest and draw their own conclusion.

1. CRASH of 1997
Some folks keep harping about the big crash of 1997 and keep repeating charts about how drastic the fall was for the landed segment but what actually happened? Were landed owners really affected when the price crashed. Just showing the price effect is only revealing one side of the story and in fact demonstrates how shallow and inept some people are as far as research goes.

Facts:
Total no. of landed transactions in 1997 = 2,315
Total stock of landed properties as at 1997 = 63,231
% of owners who actually had to sell off during the crash = 3.7%

This demonstrates the holding power of landed owners during the crash of 1997. SLIGHTLY MORE THAN 96% of landed owners did not need to sell off their landed properties at distress prices during the crash of 1997. Some people like to use the phrase that you cannot never enjoy your paper profit unless you sell. Conversely, you will never suffer a loss unless you are forced to dispose of your property.

Some folks will then try to come up with a silly postulation that the holding power was much greater in 1997 than now. Back then, the LTV was capped at 80% in 1996. Right now, the measures can cap you from 50% to as low as 20% if you buy > 1 property. Plus interest rates are at a low and expected to stay that way. Are the banks less or more like to call on your loans now than in 1997?

2. INVESTMENT RETURNS ARE LOUSY FOR LANDED
Another baseless point that some people make is that the returns from landed are lousy and that the returns are inflated only because of rebuild or AA or that its only good for the luxury landed segment. Obviously some people have been hiding pertinent info from the readers here.

These are properties WITHOUT any A&A or rebuilt done.

District 4
8 Bukit Teresa Close (terrace), bought Aug 06 for 475psf, sold in Jul 07 for 757psf. Anualised returns - 66.2%

District 5
39 Faber Crescent (semi-D) - bought Jan 10 for 471psf, sold in Dec 10 for 765psf, annualised returns - 64%

331N Pasir Panjang Road (terrace) - bought May 07 for 509psf, sold in Aug 07 for 574psf, annualised returns - 58%

District 13
16M Lor Selangat(terrace) - bought May 07 for 459psf, sold in Aug 07 for 608psf, annualised returns - 213%

District 14
115B Jln Kembangan (terrace) - bought Jun 09 for 474psf, sold in Mar 10 for 601psf, annualised returns - 34%

District 16
7C bedok rise (semi-d) - bought in Nov 06 for 210psf, sold in Oct 10 for 285psf, annualised returns - 41.7%

This is enough to digest for now and shall be continued in another post.

[proper-t]

3. Maintenance cost for landed vs condo/apts.

This has been discussed to no end and there has yet to be any empirical evidence or study to support either side so I will not comment further on which is more costly.

However, what has not been highlighted is the following:

Maintenance expenditure for landed is DISCRETIONARY whilst maintenance payments for condos and apts are MANDATORY.

What this means is that for landed, you can choose not to pay for repairs etc if you cannot afford it and put it off for later when cashflow permits however for condos and apts, you are subject to statutory law. The most pertinent being S.40(10)/(11) of Building Maintenance & Strata Mgt Act as reproduced below:

(10) Without prejudice to subsection (8), a subsidiary proprietor who fails to pay any contribution or interest due and owing to a management corporation within 14 days from the date of service of any written demand referred to insubsection (9) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $10,000 and, in the case of a continuing offence, to a further fine not exceeding $100 for every day or part thereof during which the contribution or interest or both remain unpaid after conviction.
(11) The court before which a conviction for an offence under subsection (10) is had may, in addition to such fine, order the subsidiary proprietor to pay to the management corporation the amount of any contribution together with any interest thereon or any interest certified by the management corporation to be due from such person at the date of his conviction, and such amount shall be recovered according to any written law for the time being in force for the recovery of fines.

Note that the fine everyday is on top of any LATE PAYMENT interest that the MC may levy.

If you are desparate for cash, you wll also not be able to realise your proceeds form the sale of your condo/apt until you settle your mgt fees + interest. If you are really strapped for cash, you will have to beg, borrow or steal to cough up the cash for the fees + interest before you can even hope to get any money back from the sale of your condo/apt.

[Ringo33]

The facts never lies, only those who wrongly or anyhow interpret them often does.

Singapore GDP
1996 - 7.6%
1997 - 8.5%
1998 - (-2.1)%
1999 - 6.2%

If you want to prove landed property has got holding power, then perhaps you should look into 1998 and 1999 instead of 1997.

I am also surprise that after posting this chart for so many time, you didnt even realize that the bottoming was in 1999, not 1997.

Perhaps statistic is just not your cup of tea

[Ringo33]

2. INVESTMENT RETURNS ARE LOUSY FOR LANDED
Another baseless point that some people make is that the returns from landed are lousy and that the returns are inflated only because of rebuild or AA or that its only good for the luxury landed segment. Obviously some people have been hiding pertinent info from the readers here.

These are properties WITHOUT any A&A or rebuilt done.

District 4
8 Bukit Teresa Close (terrace), bought Aug 06 for 475psf, sold in Jul 07 for 757psf. Anualised returns - 66.2%

District 5
39 Faber Crescent (semi-D) - bought Jan 10 for 471psf, sold in Dec 10 for 765psf, annualised returns - 64%

331N Pasir Panjang Road (terrace) - bought May 07 for 509psf, sold in Aug 07 for 574psf, annualised returns - 58%

District 13
16M Lor Selangat(terrace) - bought May 07 for 459psf, sold in Aug 07 for 608psf, annualised returns - 213%

District 14
115B Jln Kembangan (terrace) - bought Jun 09 for 474psf, sold in Mar 10 for 601psf, annualised returns - 34%

District 16
7C bedok rise (semi-d) - bought in Nov 06 for 210psf, sold in Oct 10 for 285psf, annualised returns - 41.7%

This is enough to digest for now and shall be continued in another post.

I am not sure what is the point here actually, if you want to compare annualized profit during the peak of flipping era, try compare it with condo lah.


Anyway, a picture tells a better story, dont need to cherry pick information.

[proper-t]

The facts never lies, only those who wrongly or anyhow interpret them often does.

Singapore GDP
1996 - 7.6%
1997 - 8.5%
1998 - (-2.1)%
1999 - 6.2%

If you want to prove landed property has got holding power, then perhaps you should look into 1998 and 1999 instead of 1997.

I am also surprise that after posting this chart for so many time, you didnt even realize that the bottoming was in 1999, not 1997.

Perhaps statistic is just not your cup of tea

way ahead of you lah...


1998

Total no. of transactions for landed = 3,481
Total stock of landed = 63,920
% of owners who actually had to sell off during 1998 = 5.4%

Even if you add up both 1997 and 1998 numbers, more than 90% of landed owners did not have to sell during the crisis.

Looks like research and in-depth analysis is definitely not your cup of tea.

[Ringo33]

way ahead of you lah...


1998

Total no. of transactions for landed = 3,481
Total stock of landed = 63,920
% of owners who actually had to sell off during 1998 = 5.4%

Even if you add up both 1997 and 1998 numbers, more than 90% of landed owners did not have to sell during the crisis.

Looks like research and in-depth analysis is definitely not your cup of tea.

I am sure you do have all those information after spending so much time working on it. But you intentionally hide it because the number doesnt look very promising.


So between 1997 + 1998 there was a 37% spike in transaction. What about 1999?

Also what are you trying to prove exactly? During a crisis, isnt that obvious that transaction volume will go down because there arent many buyers around? typical supply and demand principle. Perhaps you might want to look at the number of property advertisement during the crisis to measure how many owners are looking for buyers

And what about condo and HDB. how did they perform in terms of % of course. (Just in case you are too tempted to blow up a huge number for comparison)

[proper-t]

I am not sure what is the point here actually, if you want to compare annualized profit during the peak of flipping era, try compare it with condo lah.


Anyway, a picture tells a better story, dont need to cherry pick information.

Looks like someone is always running to the refuge of one chart whenever his earlier statements has been successfully refuted.

I am still waiting for someone here to show how much their terrace house or semi-D has appreciated without any A&A and rebuilding over the years.

[Ringo33]

I am just using this chart to dispel all that myth and rubbish that are floating around here.

Time and time again you keep coming out misleading and pointless information to corrupt this forum However I am very glad that there arent many here who believe you actually.

[proper-t]

I am sure you do have all those information after spending so much time working on it. But you intentionally hide it because the number doesnt look very promising.


So between 1997 + 1998 there was a 37% spike in transaction. What about 1999?

Also what are you trying to prove exactly? During a crisis, isnt that obvious that transaction volume will go down because there arent many buyers around? typical supply and demand principle. Perhaps you might want to look at the number of property advertisement during the crisis to measure how many owners are looking for buyers

And what about condo and HDB. how did they perform in terms of % of course. (Just in case you are too tempted to blow up a huge number for comparison)

And what are you trying to prove by posting a price index chart without any meaningful analysis of the underlying transactions?

Cycles come and go. In a crisis, its who is left standing that is important.

Since you want the ugly truth , here it comes :

For condos/apt:

1997 + 1998

No. of transactions = 19,922
Total stock of condos/apt = 98,042

% of condo/apt owners = 20% - easily double that of landed owners.

[Ringo33]

And what are you trying to prove by posting a price index chart without any meaningful analysis of the underlying transactions?

Cycles come and go. In a crisis, its who is left standing that is important.

Since you want the ugly truth , here it comes :

For condos/apt:

1997 + 1998

No. of transactions = 19,922
Total stock of condos/apt = 98,042

% of condo/apt owners = 20% - easily double that of landed owners.

Why did you not response to my other question about what meaningful things are you trying to prove with these numbers?

Is sales transaction volume up or down a good thing in property?

Go figure and tell me what you learn ok??

[MLP]

Haha, Ringo.....Ringo.....You are the real troublemaker who likes to post misleading and false information in this forum. Nobody is going to believe in you anymore. You are too defensive and too stubborn like a tough nut to crack!

I am just using this chart to dispel all that myth and rubbish that are floating around here.

Time and time again you keep coming out misleading and pointless information to corrupt this forum However I am very glad that there arent many here who believe you actually.

[Ringo33]

Haha, Ringo.....Ringo.....You are the real troublemaker who likes to post misleading and false information in this forum. Nobody is going to believe in you anymore. You are too defensive and too stubborn like a tough nut to crack!

please focus your attention on what proper-T has written, not RINGO.

He has put in substantial effort, so please show appreciation.

[MLP]

Haha, Ringo.....Ringo.....I am critisizing you. Why are you so thick skin? Why do you keep posting the same chart and talk all kind of non-sense?

please focus your attention on what proper-T has written, not RINGO.

He has put in substantial effort, so please show appreciation.

[bargain hunter]

landed property prices are at an all time high. will a higher cash deposit and ABSD sap the no. of transactions for landed like it has for CCR condos?

[proper-t]

I am just using this chart to dispel all that myth and rubbish that are floating around here.

Time and time again you keep coming out misleading and pointless information to corrupt this forum However I am very glad that there arent many here who believe you actually.

Talk about being delusional...I really don't care whether people believe me or not. I just state facts.

However, its another thing when someone is in a state of denial about their own postings. Last time I checked, I think you are well ahead of me and right on top in the fairy tale writer ratings. In fact, you have been given the honour of being compared to the infamous Mr B. Should we create an award for you?

Below are your 'fan' reviews from OTHER forumers :

It has reached beyond the point of using common sense to rationalise with TS (Ringo33). I really question his/her motive of even starting the thread. Not to discuss the movement of landed in 2013, but to "complain".

As many kind souls have pointed out, landed is really free market play. If a new SC has enough moolah to plonk for a few GCBs, then so be it. There is no need to link that with one's daughter/son etc, that is so low IMHO.

Aiyo, Ringo... why are you so against landed property?

we all know that bro ringo is just talking down the landed market because he is looking to buy land...

airspace is overpriced while landspace has yet to fully catch up

seems like I'm not alone, the more we talk the more we vomit blood as the ears are shut. now he say we cannot assume that landed has run up steeply but keep telling ppl dont buy landed as it has risen more than anything else and it will crash hard.
what kind of contridiction is this...but he can go on and on and on....
anyway not going into this anymore...

he makes as much sense as his arguments that the 3rd IR will be in jurong

Haha, Ringo.....Ringo..... No point for you to post the chart and talk about 1997 rubbish again and again. Nobody here will want to read your rubbish anymore.

If I were you, I would disappear with your infamous user ID and start afresh with a new ID. Hopefully you will talk more sense with a new ID.

Reminds me of TWIST & TURN cum DIVERT ATTENTION EXPERT MR B..

[Ringo33]

Why did you not response to my other question about what meaningful things are you trying to prove with this thread?

Is sales high or low transaction volume good thing in property?

[proper-t]

Why did you not response to my other question about what meaningful things are you trying to prove with this thread?

Is sales high or low transaction volume good thing in property?

Because by asking that question, I don't even have to lift a finger to prove your ineptitude. You just did it on your own! Only someone who has not been through a property cycle and is ignorant will ask such a question.

In a down cycle, it is always better to have low transaction volume because there will be less comparables for people to whack down your price.

In an up cycle, you will want to have more to support your price.

[Ringo33]

Becasue by asking that question, I don't even have to lift a finger to prove your ineptitude. You just did it on your own! Only someone who has not been through a property cycle and is ignorant will ask such a question.

In a down cycle, it is always better to have low transaction volume because there will be less comparables for people to whack down your price.

In an up cycle, you will want to have more to support your price.

obviously you didnt pay attention in class, thats why you need to make up your own economic theory, which obviously is wrong.

The reason why there is a down cycle is because there is more sellers chasing after small pool of buyers, which explain lower transaction and sharp correction in price. This is not a good thing because no seller wants to sell as lower price.

During the up cycle, there are buyers and sellers, thats why transaction is high and price goes up.

told you statistic is not your forte liao

Again, please refer to this chart, see how detached housing fall from almost 200 to 100 points between 1997 and 1999, while condo fall from 155 to 100 points over the same period.

So by looking at the chart, you tell me which one is better?

[proper-t]

obviously you didnt pay attention in class, thats why you need to make up your own economic theory, which obviously is wrong.

The reason why there is a down cycle is because there is more sellers chasing after small pool of buyers, which explain lower transaction and sharp correction in price. This is not a good thing because no seller wants to sell as lower price.

During the up cycle, there are buyers and sellers, thats why transaction is high and price goes up.

told you statistic is not your forte liao

Again, please refer to this chart, see how detached housing fall from almost 200 to 100 points between 1997 and 1999, while condo fall from 155 to 100 points over the same period.

So by looking at the chart, you tell me which one is better?

Haha, run back to your silly chart when you have nothing to answer. You have just shown that you don't even understand your own question. Therein lies the difference between a pratictioner and someone who just bangs on keyboard all day.

You question to me, I quote is :


Is sales high or low transaction volume good thing in property?

and not what is the cause of a down or upward swing in the cycle.

Its not my fault if you cannot articulate your questions properly.


If you are holding onto a property in a down cycle, would it be better if someone came to you with a list of comparables done in your area indicating super low prices and persuading you to sell at that price OR have someone with no comparables at all come knocking at your door.

[Ringo33]

Haha, run back to your silly chart when you have nothing to answer. You have just shown that you don't even understand your own question. Therein lies the difference between a pratictioner and someone who just bangs on keyboard all day.

You question to me, I quote is :


Is sales high or low transaction volume good thing in property?

and not what is the cause of a down or upward swing in the cycle.

Its not my fault if you cannot articulate your questions properly.


If you are holding onto a property in a down cycle, would it be better if someone came to you with a list of comparables done in your area indicating super low prices and persuading you to sell at that price OR have someone with no comparables at all come knocking at your door.

I am done with this thread. Good luck to your economic fairytale

[proper-t]

I am done with this thread. Good luck to your economic fairytale

Wait... you forgot your Mr B honorary award.....

[mantrix]

I just believe that for landed, buy it if you want to experience landed living but as an investment, the rental yield is not high enough to justify such a purchase. Any investment banking on capital appreciation is higher risk than norm

[teddybear]

Rental yield super low lah!
Good only for own stay......

There have been a lot of noise and pollution in this forum recently started by charlatans and people with ulterior motives so I thought now would be a good time to lay out all the facts for forumers here to digest and draw their own conclusion.

1. CRASH of 1997
Some folks keep harping about the big crash of 1997 and keep repeating charts about how drastic the fall was for the landed segment but what actually happened? Were landed owners really affected when the price crashed. Just showing the price effect is only revealing one side of the story and in fact demonstrates how shallow and inept some people are as far as research goes.

Facts:
Total no. of landed transactions in 1997 = 2,315
Total stock of landed properties as at 1997 = 63,231
% of owners who actually had to sell off during the crash = 3.7%

This demonstrates the holding power of landed owners during the crash of 1997. SLIGHTLY MORE THAN 96% of landed owners did not need to sell off their landed properties at distress prices during the crash of 1997. Some people like to use the phrase that you cannot never enjoy your paper profit unless you sell. Conversely, you will never suffer a loss unless you are forced to dispose of your property.

Some folks will then try to come up with a silly postulation that the holding power was much greater in 1997 than now. Back then, the LTV was capped at 80% in 1996. Right now, the measures can cap you from 50% to as low as 20% if you buy > 1 property. Plus interest rates are at a low and expected to stay that way. Are the banks less or more like to call on your loans now than in 1997?

2. INVESTMENT RETURNS ARE LOUSY FOR LANDED
Another baseless point that some people make is that the returns from landed are lousy and that the returns are inflated only because of rebuild or AA or that its only good for the luxury landed segment. Obviously some people have been hiding pertinent info from the readers here.

These are properties WITHOUT any A&A or rebuilt done.

District 4
8 Bukit Teresa Close (terrace), bought Aug 06 for 475psf, sold in Jul 07 for 757psf. Anualised returns - 66.2%

District 5
39 Faber Crescent (semi-D) - bought Jan 10 for 471psf, sold in Dec 10 for 765psf, annualised returns - 64%

331N Pasir Panjang Road (terrace) - bought May 07 for 509psf, sold in Aug 07 for 574psf, annualised returns - 58%

District 13
16M Lor Selangat(terrace) - bought May 07 for 459psf, sold in Aug 07 for 608psf, annualised returns - 213%

District 14
115B Jln Kembangan (terrace) - bought Jun 09 for 474psf, sold in Mar 10 for 601psf, annualised returns - 34%

District 16
7C bedok rise (semi-d) - bought in Nov 06 for 210psf, sold in Oct 10 for 285psf, annualised returns - 41.7%

This is enough to digest for now and shall be continued in another post.

[teddybear]

Any landed, because size bigger than what you need it to be, property tax higher, electricity, water, etc usage much higher, maintenance needs over larger area, renovation & repairs over larger area, still have to have individual pest control, after pest control still useless if neighbour never do
Quality also poorer, more repairs needed, roof always leak (very very common cause of headache and super high repair costs for repairing roofs). This repair sure can't wait, otherwise everyday put pair everywhere to collect water.
Maintenance and repairs costs no economy of scale, so always being charged much higher than condos. Over all, if you look at it over a 10 years period, sure maintenance is much higher!

3. Maintenance cost for landed vs condo/apts.

This has been discussed to no end and there has yet to be any empirical evidence or study to support either side so I will not comment further on which is more costly.

However, what has not been highlighted is the following:

Maintenance expenditure for landed is DISCRETIONARY whilst maintenance payments for condos and apts are MANDATORY.

What this means is that for landed, you can choose not to pay for repairs etc if you cannot afford it and put it off for later when cashflow permits however for condos and apts, you are subject to statutory law. The most pertinent being S.40(10)/(11) of Building Maintenance & Strata Mgt Act as reproduced below:




Note that the fine everyday is on top of any LATE PAYMENT interest that the MC may levy.

If you are desparate for cash, you wll also not be able to realise your proceeds form the sale of your condo/apt until you settle your mgt fees + interest. If you are really strapped for cash, you will have to beg, borrow or steal to cough up the cash for the fees + interest before you can even hope to get any money back from the sale of your condo/apt.

[proper-t]

Rental yield super low lah!
Good only for own stay......

Yes, thanks. 25,000 new citizens per year looking for a home to stay may think the same as you.

[proper-t]

Any landed, because size bigger than what you need it to be, property tax higher, electricity, water, etc usage much higher, maintenance needs over larger area, renovation & repairs over larger area, still have to have individual pest control, after pest control still useless if neighbour never do
Quality also poorer, more repairs needed, roof always leak (very very common cause of headache and super high repair costs for repairing roofs). This repair sure can't wait, otherwise everyday put pair everywhere to collect water.
Maintenance and repairs costs no economy of scale, so always being charged much higher than condos. Over all, if you look at it over a 10 years period, sure maintenance is much higher!

Unless you have historical evidence to prove that condo maintenance in general is more or less than landed, the debate will go on & on. Economies of scale argument does not hold true for small developments with a small number of large units and facilities.

The only fact which nobody can dispute is that landed maintenance is DISCRETIONARY and condo/apt maintenance is legally MANDATORY. Go ponder on the implications of this in a down market situation.

[teddybear]

May be you want to provide evidence to prove what you say?

I have no evidence, but experience to say what I say about landed vs condo. What about you?

Unless you have historical evidence to prove that condo maintenance in general is more or less than landed, the debate will go on & on. Economies of scale argument does not hold true for small developments with a small number of large units and facilities.

The only fact which nobody can dispute is that landed maintenance is DISCRETIONARY and condo/apt maintenance is legally MANDATORY. Go ponder on the implications of this in a down market situation.

[proper-t]

May be you want to provide evidence to prove what you say?

I have no evidence, but experience to say what I say about landed vs condo. What about you?

My evidence is in S.40(10)/(11) of Building Maintenance & Strata Mgt Act. It is an offence if you do not pay your maintenance fees for strata units.

(10) Without prejudice to subsection (8), a subsidiary proprietor who fails to pay any contribution or interest due and owing to a management corporation within 14 days from the date of service of any written demand referred to insubsection (9) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $10,000 and, in the case of a continuing offence, to a further fine not exceeding $100 for every day or part thereof during which the contribution or interest or both remain unpaid after conviction.
(11) The court before which a conviction for an offence under subsection (10) is had may, in addition to such fine, order the subsidiary proprietor to pay to the management corporation the amount of any contribution together with any interest thereon or any interest certified by the management corporation to be due from such person at the date of his conviction, and such amount shall be recovered according to any written law for the time being in force for the recovery of fines.

Why are you so argumentative? Did I say condo maintenance is more than landed? All I said is that there is no evidence to prove it one way or the other. Just because you have had a bad experience in your landed doesn't mean it is representative of the entire landed market unless you can tell us all here that you have stayed in over 50% of all the landed properties in Singapore.

Some people might just have bad luck in choosing a bad landed or condo unit which requires more maintenance.

[jklm]

Condo mthly maintenance charge say 300.
For landed, u need only have major repair or painting every 5 years on average, same as condo maintenance cycle.
So, 5x12x300 = 18k. More than sufficient for repainting and repair for landed hse, which cost est 10k.

Conclusion seemed to be maintenance is cheaper for landed, some more is discretionary.

Logical?

[Ringo33]

Condo mthly maintenance charge say 300.
For landed, u need only have major repair or painting every 5 years on average, same as condo maintenance cycle.
So, 5x12x300 = 18k. More than sufficient for repainting and repair for landed hse, which cost est 10k.

Conclusion seemed to be maintenance is cheaper for landed, some more is discretionary.

Logical?

a logical person will never say that living in landed property is cheaper than condo because we all know that what most landed owners are pay in utility bills every month will be more than what most condo owners are paying for maintenance.

while we are at it, please do also remember that what condo dwellers are paying in maintenance is not just four walls and a door, they are paying for tangible benefits like having landscape kids play ground. swimming pool, jacuzzi, function room, gym, tennis court, security, BBQ pit, view etc.

And unless you have concrete statistics and fact to prove, if not please dont say that condo dwellers doesnt use their facilities.