MAS makes commentators look foolish again

[vip]

https://www.propertysoul.com/2017/07...ators-foolish/

MAS makes commentators look foolish again

July 6, 2017



Last Thursday, Managing Director of Monetary Authority of Singapore (MAS) Ravi Menon mentioned at the annual report media conference that it is “not time yet to ease the cooling measures”, “they remain necessary” and “easing the measures now would send a wrong signal”.


Sorry, cooling measures are to stay

Menon cited two reasons for the decision: 1) Good pick-up of recent project launches under low interest rate environment; and 2) Increased tightening of property buying restrictions in other countries.

Menon emphasized that “property prices should be aligned with broader income trends in the economy and the government will not let “property prices increase faster than nominal GDP growth”.

Private residential property prices have climbed 60 percent over 17 quarters, but only declined less than 12 percent in the last 14 quarters.

Menon restated that MOF, MND, and MAS were all very clear in the March announcement that the adjustments “were made for very specific reasons and purposes” and the government has never changed its position on the TDSR structure, Additional Buyer’s Stamp Duty and Loan-to-Value limits.

“The calibrated adjustments by the government earlier this year do not signal the start of an unwinding of the property cooling measures, as some commentators have suggested.”

Oops, MAS just gave industry stakeholders who speculated further relaxation of cooling measures a real slap on the face!

The market tends to make us look foolish most of the time, isn’t it?

Those who recently bought on deferred payment scheme or stay-then-pay programme should now realize that the wait may not be just one to two years’ time.

Edmund Tie & Co told the media last month that one investor takes ABSD in buying properties as the COE in buying cars, if the government is not lifting ABSD.

What the investor fails to see is: All car owners have to pay COE to drive a car. But not all property owners have to pay ABSD to buy a home. It depends on when they buy it and whether they are buying their first property.

Next time when he is competing with other owners of similar units in the same project for tenants or buyers, he will realize that they are not competing on equal footings because of the ABSD he has paid.


Why some commentators still don’t get it?

In fact, the commentators are not being slapped once but again and again by the government.

Every time when there was market speculation on relaxation of the cooling measures, the government would not hesitate to come upfront and put it straight.



A contrarian’s view? Who bothers?

You can’t blame industry stakeholders who assured you that the government will lift ABSD soon; or Morgan Stanley who predicted that Singapore property prices to double by 2030; or JLL who claimed that residential market will likely to recover by early 2018 – when home buyers are taking the plunge fearlessly; when new launch projects are selling like hot cakes; when developers are bidding hungrily for new sites like there’s no tomorrow.

All these analysts are predicting that the property market will recover any time soon. We haven’t seen such positive market sentiments for a long time.

Who bother to be a contrarian here?

I did have a few blog posts with a different view:

1) It’s not bottoming-out. It’s dead cat bounce.

2) 3 reasons why adjustments to property measures is not a good sign

3) Who said property cooling measures may never be lifted?

I am not saying that the property market will crash soon. I just believe that the market is going to be different from what the local media and industry stakeholders are predicting.

Ken Fisher said in his book Beat the Crowd that a contrarian doesn’t have to hold an “opposite view” from the majority. A contrarian just holds a “different view”. If most people believe that this is what‘s going to happen in the market, the contrarian simply believes that something else will.

History tells us that the market likes to make most of us look foolish most of the time. It always gives us an anti-climax at the maximum point of optimism.

“The contrarian looks for things the herd and curmudgeons ignore – they branch out. Or they look at the same things but see them differently. Both actions let them find the risks and opportunities most others miss.”

“A 60% or 70% success rate keeps you well ahead of most … if you’re right 70% of the time in this realm, you become an absolute living legend.”

You see, I am only targeting 60 percent or at most 70 percent of the time to be right. I said it about Iskandar and Malaysia properties 3 years ago in 2014. I said it about market slowdown and some other things as well. It’s not too difficult to be 60 to 70 percent of the time correct, isn’t it?

[tonymontana]

More fanciful stories and conjecture from propsoul.
Everyone knows ABSD is here to stay, no surprises there.
There is no slapping going on, either by MAS or any other govt body.
They are saying it because market is picking up: they definitely cannot say or hint ABSD may be removed (it won't).
Getting it right, Iskandar - anybody could 've guessed it in 2014.

[teddybear]

Why should they remove ABSD when it is big fat cash cow that people willing pay???????

They already have to have thick skin to increase prices/tariffs of car park, conservatory charges, rubbish charges, property taxes, water, soon electricity (due to carbon tariffs), soon possibly transport too? What else can they raise to increase their revenue?????????

Oh yah, heard they are going to cut Universities and ASTAR budget by 30% next year too?
Any other statutory boards also facing budget cut?

Heard coffeeshop talk asking why Government seems to be so short of money?????

More fanciful stories and conjecture from propsoul.
Everyone knows ABSD is here to stay, no surprises there.
There is no slapping going on, either by MAS or any other govt body.
They are saying it because market is picking up: they definitely cannot say or hint ABSD may be removed (it won't).
Getting it right, Iskandar - anybody could 've guessed it in 2014.

[Arcachon]

Why should they remove ABSD when it is big fat cash cow that people willing pay???????

They already have to have thick skin to increase prices/tariffs of car park, conservatory charges, rubbish charges, property taxes, water, soon electricity (due to carbon tariffs), soon possibly transport too? What else can they raise to increase their revenue?????????

Oh yah, heard they are going to cut Universities and ASTAR budget by 30% next year too?
Any other statutory boards also facing budget cut?

Heard coffeeshop talk asking why Government seems to be so short of money?????

If they know how HDB get their money to build HDB, they will not say Government seems to be short of money.

[tonymontana]

Why should they remove ABSD when it is big fat cash cow that people willing pay???????

They already have to have thick skin to increase prices/tariffs of car park, conservatory charges, rubbish charges, property taxes, water, soon electricity (due to carbon tariffs), soon possibly transport too? What else can they raise to increase their revenue?????????

Oh yah, heard they are going to cut Universities and ASTAR budget by 30% next year too?
Any other statutory boards also facing budget cut?

Heard coffeeshop talk asking why Government seems to be so short of money?????

Yes, I'm saying they won't remove ABSD anytime soon. TDSR is here to stay. ASTAR budget should be cut, less wastage of taxpayers' monies.

[Kelonguni]

ABSD almost = COE. It only applies to spare properties or investment property purchases.

If one wants to rent out or invest in a property, ABSD becomes inevitable unless it's first property. If want to avoid ABSD must sell previous property so that group is buying for own stay and can't easily profit from it. Not so easy to sell.

Yes, MAS does make those who sold out at little or negative profits look foolish.

The demand can only grow. When will there ever be the excuse to remove ABSD?

[teddybear]

And universities' budget are also cut 30% because they are wasting tax-payers monies?

Yes, I'm saying they won't remove ABSD anytime soon. TDSR is here to stay. ASTAR budget should be cut, less wastage of taxpayers' monies.

Why should they remove ABSD when it is big fat cash cow that people willing pay???????

They already have to have thick skin to increase prices/tariffs of car park, conservatory charges, rubbish charges, property taxes, water, soon electricity (due to carbon tariffs), soon possibly transport too? What else can they raise to increase their revenue?????????

Oh yah, heard they are going to cut Universities and ASTAR budget by 30% next year too?
Any other statutory boards also facing budget cut?

Heard coffeeshop talk asking why Government seems to be so short of money?????

[anythingwhatever]

ABSD almost = COE. It only applies to spare properties or investment property purchases.

If one wants to rent out or invest in a property, ABSD becomes inevitable unless it's first property. If want to avoid ABSD must sell previous property so that group is buying for own stay and can't easily profit from it. Not so easy to sell.

Yes, MAS does make those who sold out at little or negative profits look foolish.

The demand can only grow. When will there ever be the excuse to remove ABSD?

Buy more before Gahmen "increase" ABSD.

When ABSD first came out, was only 3%, those who KPKB and waited for it to be removed may have regretted now.

[teddybear]

I think you miss the point totally.

If Government does not seem to be short of money, why need to increase the prices of so many things that they control to raise the irk of their voting citizens?

As to " HDB get their money to build HDB" etc, looks like all those profit still not enough and hence have to raise more money???????????

If they know how HDB get their money to build HDB, they will not say Government seems to be short of money.

Why should they remove ABSD when it is big fat cash cow that people willing pay???????

They already have to have thick skin to increase prices/tariffs of car park, conservatory charges, rubbish charges, property taxes, water, soon electricity (due to carbon tariffs), soon possibly transport too? What else can they raise to increase their revenue?????????

Oh yah, heard they are going to cut Universities and ASTAR budget by 30% next year too?
Any other statutory boards also facing budget cut?

Heard coffeeshop talk asking why Government seems to be so short of money?????

[tonymontana]

And universities' budget are also cut 30% because they are wasting tax-payers monies?

Universities do have income, and are somewhat autonomous.

[teddybear]

No, they still get lots of tax-payers money (which will be cut by 30%)!
Why they are getting so much government's subsidy is anybody's guess....... may be to subsidize foreigners and PRs to study in these university?

Universities do have income, and are somewhat autonomous.

[Arcachon]

I think you miss the point totally.

If Government does not seem to be short of money, why need to increase the prices of so many things that they control to raise the irk of their voting citizens?

As to " HDB get their money to build HDB" etc, looks like all those profit still not enough and hence have to raise more money???????????

How much you need, I get HDB to print for you.

All Digit, no need paper, and ink.

The Housing & Development Board ("HDB") has issued S$600 million, 10-year Fixed Rate Notes (the “Notes”) under its S$32 billion Multicurrency Medium Term Note ("MTN") Programme.

http://www.hdb.gov.sg/cs/infoweb/pre...xed-rate-notes

If Government does not seem to be short of money, why need to increase the prices of so many things that they control to raise the irk of their voting citizens?

If you know what is Inflation, you will know they did not increase.

[teddybear]

I can only say stupidity by people who act smart has no bound..............

How much you need, I get HDB to print for you.

All Digit, no need paper, and ink.

The Housing & Development Board ("HDB") has issued S$600 million, 10-year Fixed Rate Notes (the “Notes”) under its S$32 billion Multicurrency Medium Term Note ("MTN") Programme.

http://www.hdb.gov.sg/cs/infoweb/pre...xed-rate-notes

If Government does not seem to be short of money, why need to increase the prices of so many things that they control to raise the irk of their voting citizens?

If you know what is Inflation, you will know they did not increase.

[Arcachon]

I can only say stupidity by people who act smart has no bound..............

Your words can tinker my ass, so pain.

HDB created 32 Billion guess who created the interest for the 32 Billion.

[Arcachon]

[tonymontana]

No, they still get lots of tax-payers money (which will be cut by 30%)!
Why they are getting so much government's subsidy is anybody's guess....... may be to subsidize foreigners and PRs to study in these university?

Foreigners and PRs pay more in fees if they join the varsities.

[Arcachon]

[Arcachon]

[Hakuho]

I can only say stupidity by people who act smart has no bound..............

LOL.

Don't really understand the obsession with property, and treating it as active investment. Property is but the most passive type of investment.

For active investment, if you trade forex for example, with a position size of only $10 k per trade per day it is not difficult to make $10 k per month. When there is volatility, getting $2 k from a trade within 2-3 hours is not uncommon.

100% return of the position size in a month. To make $10 k per month, it requires to make only an average of $500 per day nia. The key is how to place the call or put position defensively, non aggressively.

I always advocate for a young person to start learning how to trade derivatives from early. Then when he reaches the age of 55, from then until maybe 85, he can still make good money if he keeps his mind healthy.

And sane, ahaha.

[Arcachon]

LOL.

Don't really understand the obsession with property, and treating it as active investment. Property is but the most passive type of investment.

For active investment, if you trade forex for example, with a position size of only $10 k per trade per day it is not difficult to make $10 k per month. When there is volatility, getting $2 k from a trade within 2-3 hours is not uncommon.

100% return of the position size in a month. To make $10 k per month, it requires to make only an average of $500 per day nia. The key is how to place the call or put position defensively, non aggressively.

I always advocate for a young person to start learning how to trade derivatives from early. Then when he reaches the age of 55, from then until maybe 85, he can still make good money if he keeps his mind healthy.

And sane, ahaha.

[teddybear]

More by how much?
As far as I know, the "more" is barely 30% more, which is still much below the costs that Government CLAIMED they need to spend to nurture 1 Uni student.........
If so, why should Singaporean tax payers subsidize these foreigners and PRs?

Foreigners and PRs pay more in fees if they join the varsities.

[Kelonguni]

When an investment gets overly active, the accompanying risks also go up.

One can earn a lot using a specific investment tool means one can also lose a lot, especially in some types of trade that do not generate utility value.

For properties, the minimum to fall back to is the utility value that can be derived by an owner or tenant. This value can rise or fall but there is a guaranteed value that is not that speculative if you know what to buy.

Derivatives can be picked up anytime even after retirement using spare funds. Can you buy properties without loan after you retire?

[teddybear]

Why you can't loan after you retire????????

When an investment gets overly active, the accompanying risks also go up.

One can earn a lot using a specific investment tool means one can also lose a lot, especially in some types of trade that do not generate utility value.

For properties, the minimum to fall back to is the utility value that can be derived by an owner or tenant. This value can rise or fall but there is a guaranteed value that is not that speculative if you know what to buy.

Derivatives can be picked up anytime even after retirement using spare funds. Can you buy properties without loan after you retire?

[Kelonguni]

Why you can't loan after you retire????????

Someone earning personal wages that peaked 25 years ago will never be able to obtain loan today.

But those who took the loan and paid up over 25 years will be able to take equity loan today for derivatives and other instruments.

Prioritise!

[Arcachon]

Why you can't loan after you retire????????

Can Loan if still got income subject to TDSR.


MAS Restricts Loan Tenure for Residential Properties

Singapore, 5 October 2012...The Monetary Authority of Singapore (MAS) will restrict the tenure of loans granted by financial institutions for the purchase of residential properties. MAS’ move is part of the Government’s broader aim of avoiding a price bubble and fostering long term stability in the property market.

2 The maximum tenure of all new residential property loans will be capped at 35 years. In addition, loans exceeding 30 years tenure will face significantly tighter loan-to-value (LTV) limits. This will apply to both private properties and HDB flats. The new rules will take effect from 6 October 2012.

Long tenure loans fuel property prices

3 The new rules aim to curb continued upward pressure on residential property prices, driven by low interest rates and rapid credit growth.

4 Previous rounds of Government measures have had a moderating effect on residential property prices. There is also significant supply of housing that will come onto the market over the next two years. However, prices in both the HDB resale market and private residential property have continued to rise in Q2 and Q3 of 2012.

5 The current climate of low interest rates, globally and in Singapore, is likely to persist for some time. It will continue to spur demand in the residential property market, pushing up prices beyond sustainable levels. The eventual correction could be painful to borrowers and destabilise the economy.

6 At the same time, financial institutions have been lengthening the tenures of residential property loans. Over the last three years, the average tenure for new residential property loans has increased from 25 to 29 years. More than 45% of new residential property loans granted by financial institutions have tenures exceeding 30 years.

7 Long tenure loans pose risks to both lenders and borrowers. The lower initial monthly repayments, made possible by long loan tenures and the current low interest rates, may lead borrowers to over-estimate their ability to service the loans, and take a bigger loan than they can really afford. A rising property market may give false confidence to both borrowers and lenders that should there be difficulty in servicing the loan they can always sell the property at a higher price. In reality, long tenure loans impose a larger debt repayment burden on borrowers as interest accumulates over a longer period. When interest rates eventually rise, borrowers who have overextended themselves will have difficulties repaying their loans. If property prices fall, financial institutions may be caught holding the bad loans.

8 Mr Tharman Shanmugaratnam, Chairman of MAS, said, “Monetary conditions worldwide are far from normal. QE3 and low interest rates have made credit easy, but this will eventually change. We are taking this step now to require more prudent lending, and will continue to watch the property market carefully. We will do what it takes to cool the market, and avoid a bubble that will eventually hurt borrowers and destabilise our financial system.”

New rules on loan tenure

9 The new MAS rules impose an absolute limit of 35 years on the tenure of all loans for residential property. This will apply to loans to both individual and non-individual borrowers, as well as refinancing loans1, from 6 October 2012.2

10 In addition, MAS will lower the LTV ratio for new residential property loans to borrowers who are individuals, if:

the tenure exceeds 30 years; or
the loan period extends beyond the retirement age of 65 years.
For these loans, the LTV limit will be:

40% for a borrower with one or more outstanding residential property loans3; and
60% for a borrower with no outstanding residential property loan.
11 MAS will also lower the LTV ratio for residential property loans to non-individual borrowers from 50% to 40%.

[Arcachon]

[teddybear]

Still don't understand why you can't get any loan when you have no wages.
A person can still get loan with no wages and no property..........

Someone earning personal wages that peaked 25 years ago will never be able to obtain loan today.

But those who took the loan and paid up over 25 years will be able to take equity loan today for derivatives and other instruments.

Prioritise!

[Arcachon]

Still don't understand why you can't get any loan when you have no wages.
A person can still get loan with no wages and no property..........

Where are you when they announce all the Control Measure.

My friend father 75 years old with no job was given a 25 years loan before the Control Measure.

[teddybear]

Property control measure or not is not material because people can still get loan with no wages and no property..............

Hack, you don't even need loan to get leverage to earn more money (if you know how). Think Hakuho already leaked something on that (but there are more ways)................
Just that you need an open mind and learn how to go about doing it.........
Property is not my whole world and not my 1 and only investment (and never be)..................

Where are you when they announce all the Control Measure.

My friend father 75 years old with no job was given a 25 years loan before the Control Measure.

Someone earning personal wages that peaked 25 years ago will never be able to obtain loan today.

But those who took the loan and paid up over 25 years will be able to take equity loan today for derivatives and other instruments.

Prioritise!

LOL.

Don't really understand the obsession with property, and treating it as active investment. Property is but the most passive type of investment.

For active investment, if you trade forex for example, with a position size of only $10 k per trade per day it is not difficult to make $10 k per month. When there is volatility, getting $2 k from a trade within 2-3 hours is not uncommon.

100% return of the position size in a month. To make $10 k per month, it requires to make only an average of $500 per day nia. The key is how to place the call or put position defensively, non aggressively.

I always advocate for a young person to start learning how to trade derivatives from early. Then when he reaches the age of 55, from then until maybe 85, he can still make good money if he keeps his mind healthy.

And sane, ahaha.

[Arcachon]

Property control measure or not is not material because people can still get loan with no wages and no property..............

Hack, you don't even need loan to get leverage to earn more money (if you know how). Think Hakuho already leaked something on that (but there are more ways)................
Just that you need an open mind and learn how to go about doing it.........
Property is not my whole world and not my 1 and only investment (and never be)..................

One of the way is the Riway thing. Pay 3,000 get more people to pay 3,000.