5-10% borrowers over-leveraged on property purchases: MAS

[chestnut]

My friend bot his terrace house 20 + years ago at 200k+.
Fast forward a few years later from the time he bought...
Let me ask each of u a few question:
1. Should he sell @ 400k - he may be thinking - double liao leh, how to continue to go up
2. Should he sell at 600k? Wa, make 400 k already leh, where got upside? More downside than upside.
3. Should he sell @ 800k. Definitely no more upside...

Now let me bring you back to the 70s... Do u think those people then would have thot their 20k houses will be worth 200k + in the 90s.

Hahahahahaha

[eng81157]

Guess the probability of a interest rate hike is how high in order to cause our 2 Ministers to step out and warn us about it publicly?


Think About IT.

please don't read too much about 2 ministers stepping out.

THE WHOLE CABINET is up at arms over a bloody hawker center roof and PMO office is shooting out warning letters.

YOG budget overblown by $200m? Mas Selamat escape? NS recruit died from too much smoke grenade thrown (and the ever changing testimonies of witnesses in court)?

do you see the cabinet kicking up a ruckus? It's an honest mistake, let's move on

[Secretariat]

Brudder, if a person hold 2 units, u think he should sell?

If he sells, he is no longer vested. House to stay in, to me is not counted as investment hor.

Exactly, this approach means that only half his money get invested all the times.

Cheers!

[Secretariat]

My friend bot his terrace house 20 + years ago at 200k+.
Fast forward a few years later from the time he bought...
Let me ask each of u a few question:
1. Should he sell @ 400k - he may be thinking - double liao leh, how to continue to go up
2. Should he sell at 600k? Wa, make 400 k already leh, where got upside? More downside than upside.
3. Should he sell @ 800k. Definitely no more upside...

Now let me bring you back to the 70s... Do u think those people then would have thot their 20k houses will be worth 200k + in the 90s.

Hahahahahaha

Did the prices of terraced go up in a straight line?

Ringo, we need your chart...

Cheers!

[mcmlxxvi]

for some perspective, lets look at whats happening in the worlds leading economy,

http://money.cnn.com/2013/07/18/real...ney_realestate

[chestnut]

Did the prices of terraced go up in a straight line?

Ringo, we need your chart...

Cheers!

The answer NO. But exit and entrance time important. If misstep how? Hahaha
Aftermath, everything also look simple. Look at Citibank, LVS stocks.

Hahaha

[kane]

here is a hypothetical question before one considers liquidating. if the market pulls back 20%, but the measures aren't lifted, can you afford to re enter the market.

[eng81157]

My friend bot his terrace house 20 + years ago at 200k+.
Fast forward a few years later from the time he bought...
Let me ask each of u a few question:
1. Should he sell @ 400k - he may be thinking - double liao leh, how to continue to go up
2. Should he sell at 600k? Wa, make 400 k already leh, where got upside? More downside than upside.
3. Should he sell @ 800k. Definitely no more upside...

Now let me bring you back to the 70s... Do u think those people then would have thot their 20k houses will be worth 200k + in the 90s.

Hahahahahaha

well, this is hindsight............ain't the same as having foresight

similarly, we can go around spain/greece and ask the folks on the ground - did you ever think that your country would be on the brink of bankrupt while it was boom time?

[mcmlxxvi]

sorry but i don't buy this TDSR bs.

if my household earns $20000/mth, why can't i plough 60% of my household income into properties? $8000 is a pretty comfortable sum to live by (assuming that we aren't living the high life)

if my household earns $5000/mth, ploughing 50% of my income into properties is taxing. it's trying to live with $2.5k per month.

This is an interesting perspective, i been living on 300pm allowance almost all my life so high TDSR is really like telling me the sun is going to rise from the east.

Im really a very tiny ikan bilis (oh ya btw where r u?) small cap ppty player. If i have the means i would have bought up hamilton n gcb n rosalie dr than to bother abt mm's seriously.

[mcmlxxvi]

I oso dun buy tis rule. I am abt 80% TDSR but Im still eyeing for another ppty!

Aiyo bank balance gaogao collecting algae. Faster deploy lah or the bank notes corroded by sea water liao... lol.

[Secretariat]

The answer NO. But exit and entrance time important. If misstep how? Hahaha
Aftermath, everything also look simple. Look at Citibank, LVS stocks.

Hahaha

Misstep?

You should be more wary of buying at the highest price than selling at the highest price, especially the highest price doubled within 3 years.

Cheers!

[eng81157]

This is an interesting perspective, i been living on 300pm allowance almost all my life so high TDSR is really like telling me the sun is going to rise from the east.

Im really a very tiny ikan bilis (oh ya btw where r u?) small cap ppty player. If i have the means i would have bought up hamilton n gcb n rosalie dr than to bother abt mm's seriously.

$300pm (and i assume m = month, not minutes)

me also ikan bilis lah. i'm just trying to point out about the bad use of statistics - 60% TDSR don't mean a shit, even looking at the bigger picture.

for example, malay ministers make a $1000 contribution to charity = big hoohaa with loads of fanfare on prime time news. but if we look at the % of their monthly salary, it's more peanutty than peanuts (probably the skin flakes of peanuts)......

[mcmlxxvi]

While it is always right to promote prudence, and promote keeping enough cash buffer, and to calculate different interest rate scenarios (as all banks have always been supposed to advise customers in such a way for years), Lion King has gone further by repeating similar messages/videos in various ways, exaggerating 50% haircut, and to quote irrelevant cases like China's recent spike of 30%, which is actually overnight or 7-day repo rate, while Singapore's mortgage loans are based on 1-month or 3-month SIBOR/SOR, which does not usually have such spikes (just check the historical chart).

By doing so would raise suspicion that Lion King is doing this for selfish reasons, e.g. to justify his recent sell, or to buy his next target at lower prices. Well, actually this is what most people are here for, but I'm just quite free now, and would like to point this out. I'm not saying Lion King should not do this, everyone has his own reasons, and forum is an open space for all to find info, discuss, and try to achieve his hidden agenda.

http://forums.condosingapore.com/showthread.php?t=18336

Hidden agenda? I think he is providing kind advice OPENLY leh! Lol

I actually support his sale to cash in on profit. 见好就收。

It is not like he sold all his ppties! If so what will he still be doing here in a property forum....

At least its better than many who count their eggs before hatching.... dreaming wet dreams about profits - on paper! And hao lianing away....

[mcmlxxvi]

$300pm (and i assume m = month, not minutes)

me also ikan bilis lah. i'm just trying to point out about the bad use of statistics - 60% TDSR don't mean a shit, even looking at the bigger picture.

for example, malay ministers make a $1000 contribution to charity = big hoohaa with loads of fanfare on prime time news. but if we look at the % of their monthly salary, it's more peanutty than peanuts (probably the skin flakes of peanuts)......

Thats why, everything has to be placed in the right context. Context is the keyword.

[mcmlxxvi]

Haha, for a reader wearing a rose-tinted glasses, he wouldn't bother to read my post anyway. When I first posted in this forum, obviously fully vested, people mocked my postings anyway and called me a bear?

What is a bull, what is a bear?

In any other more liquid markets, such as stock, bond, currency etc, short-only traders (people who only short an instrument) comprised only a fraction of the all traders. Less than 5%; whether in a rising or falling market.

Which means that, the bull and the bear is practically the same person. When he buys, he is a bull; he sells when he turn bearish.

In a property market, there is no direct way of shorting a property.

For a rational investor, before investing in a property (or any instrument), he would make sure that he measured and understood the downside risk 100%. When vested, he would track his investment and make sure that he measures and understands the downside risk even more, 200%.

I give you an example. Some one calculated that his incremental rental income from a unit he bought at $500,000 as $9910 per year. Now this unit could now be $900,000 for example, when mark to market.

Is not the $400,000 increase in price equaled to 40 years of his current net rental income? Should he sell or hold? My quests is 90% of the readers would advocate hold.

But has anyone considered the downside risk?


Cheers!

I am holding it still obviously coz it hasnt reached 900k.... far from it in fact, lol.

If 900k confirm i sell immediately le. I can buy up another unit in FULL CASH. Fxxk the cm or tdsr ok!

Thats why i feel nobody should advocate only one way or the other. Hold or sell. Large unit or mm. Ocr or ccr. Circumstances change and market forces play at everybody which is why investing is never a simple game.

[chestnut]

well, this is hindsight............ain't the same as having foresight

similarly, we can go around spain/greece and ask the folks on the ground - did you ever think that your country would be on the brink of bankrupt while it was boom time?

Hahaha... I bot many leh... So I got foresight? Hahahahaha
I say waterview wat???? Hahaha. I say pasir panjang... I say us rocks wat. Hahahaha

Now I not buying props wat. I dare to commit. Hahahaha

[chestnut]

Misstep?

You should be more wary of buying at the highest price than selling at the highest price, especially the highest price doubled within 3 years.

Cheers!

Aiyo brudder, I already said I not buying wat. I downsized my Botannia to waterview in terms of quantum but I made more from waterview on paper today compared with if I had kept waterview leh.
Both % wise and also $ wise. Somemore I managed to keep money into my bank after sales of Botannia and putting in 40% down payment for waterview leh? Hahahaha

Please read my post properly leh....

[mcmlxxvi]

Aiyo brudder, I already said I not buying wat. I downsized my Botannia to waterview in terms of quantum but I made more from waterview on paper today compared with if I had kept waterview leh.

Please read my post properly leh....

Ooops bro, i indirectly suaned u on the paper profit shouting comment, pai seh

But yours diff. Its hindsight paper, not forward looking paper lol. I.e. eggs already hatched.

[mermaid]

How you do that ? Can share with your humble Office Boy ?

DKSG

I set aside more cash buffer for the next ppty instead of a smaller loan for the existing. I took up 80% loan over a shorter repayment period, as a result I am heavily over the 60% TDSR rule.

nothing fantastic abt my approach, juz tat I am deemed as not prudent according to the TDSR rule.

in fact, tis rule create another set of prob for me. I wun be able to get a loan for my next ppty

but den, I hv tot of a way to go abt it, hehe ...

I will go ahead to buy the next ppty w/o taking a loan. after my existing ppty top, I will reprice by reducing the loan quantum & increase my repayment period. after which I will take up a loan for my new ppty.

[chestnut]

I am holding it still obviously coz it hasnt reached 900k.... far from it in fact, lol.

If 900k confirm i sell immediately le. I can buy up another unit in FULL CASH. Fxxk the cm or tdsr ok!

Thats why i feel nobody should advocate only one way or the other. Hold or sell. Large unit or mm. Ocr or ccr. Circumstances change and market forces play at everybody which is why investing is never a simple game.

Spoken like a true champion. How to pass judgement without knowing someone's objectives and intentions???? Hahahaha

So those who buy Lamborghini seow ah???? Those who don't want to sell the Lamborghini in times of trouble - seow ah? I dare not say hor

[eng81157]

I set aside more cash buffer for the next ppty instead of a smaller loan for the existing. I took up 80% loan over a shorter repayment period, as a result I am heavily over the 60% TDSR rule.

nothing fantastic abt my approach, juz tat I am deemed as not prudent according to the TDSR rule.

in fact, tis rule create another set of prob for me. I wun be able to get a loan for my next ppty

but den, I hv tot of a way to go abt it, hehe ...

don't tell me you're going the way of YOWETAN.........

[mcmlxxvi]

Spoken like a true champion. How to pass judgement without knowing someone's objectives and intentions???? Hahahaha

So those who buy Lamborghini seow ah???? Those who don't want to sell the Lamborghini in times of trouble - seow ah? I dare not say hor

Pai seh la.......cheeeeerrrs. all actually no need get worked up in discussions de, plenty of learning opps here. this forum is not toastmaster forum leh.

[chestnut]

Ooops bro, i indirectly suaned u on the paper profit shouting comment, pai seh

But yours diff. Its hindsight paper, not forward looking paper lol. I.e. eggs already hatched.

Bro, no offence. I share for people to have case study. Not to howlian. Why need to howlian???? Aiyo, those howlian here poor thing leh...

[mermaid]

don't tell me you're going the way of YOWETAN.........

yowe de which way?

[DC33_2008]

That terrace will be $2 - 3 million now. My view remains the same : Properties are bought to be kept, especially FH and in good locations

My friend bot his terrace house 20 + years ago at 200k+.
Fast forward a few years later from the time he bought...
Let me ask each of u a few question:
1. Should he sell @ 400k - he may be thinking - double liao leh, how to continue to go up
2. Should he sell at 600k? Wa, make 400 k already leh, where got upside? More downside than upside.
3. Should he sell @ 800k. Definitely no more upside...

Now let me bring you back to the 70s... Do u think those people then would have thot their 20k houses will be worth 200k + in the 90s.

Hahahahahaha

[mcmlxxvi]

Bro, no offence. I share for people to have case study. Not to howlian. Why need to howlian???? Aiyo, those howlian here poor thing leh...

Actually if wanna haolian this thread not bad spot,,,, lol......almost 3000 views in 2 days nia.

[mcmlxxvi]

That terrace will be $2 - 3 million now. My view remains the same : Properties are bought to be kept, especially FH and in good locations

Jlrx!!!!!! Welcome back!

[chestnut]

That terrace will be $2 - 3 million now. My view remains the same : Properties are bought to be kept, especially FH and in good locations

Bro dc.... Silent thinker.

Clap, clap

[eng81157]

yowe de which way?

make mother, mother-in-law, brother-in-law all rent out their HDBs or sell them, move in with him into a 2BR unit, and plough all their money to help him settle his monthly mortgage.

[mermaid]

make mother, mother-in-law, brother-in-law all rent out their HDBs or sell them, move in with him into a 2BR unit, and plough all their money to help him settle his monthly mortgage.

u really buy his story? I happen to noe a yowe in another forum not sure if they r the same person though