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Guest
on 29 Apr 08 2:27 am
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| Anonymous wrote: | Well...I would wait at least another 6 months to a year.
We told clients and investors to sell all Singapore holdings (property, stocks and everything else) in June 2007. We determined that prices would never, ever be higher and were predicting a 15% drop in pricing by March 2008 and 25% drop by June 2008.
Rationale was simple and not rocket science.
#1. There was no demand for housing when the boom started.
The vacancy rates on existing housing were above New York, London, Hong Kong, Tokyo and other major urban market levels. A Singapore property boom made no sense at all.
#2. Singapore GDP...nice impressive numbers. But the growth was 99% construction related. There is no economic growth when the construction boom ends and those numbers are subtracted from the total.
#3. The existing luxury housing vacancy levels in Singapore were adequate to fill the needs of Singaporeans and any possible influx of new senior executives for the next 5 years. Thus, there was no demand for executive luxury housing in the market.
#4. Value for money on Singapore property for foreign investors is not good when compared to other projected growth economies. (several factors are weighed including psf, quality of workmanship, size of economy, projected growth of economy, lifestyle and culture of the market.)
#4. The targeted future population numbers of Singapore are pie in the sky and completely without substance. Singaporeans are not having kids and the demand for jobs in Singapore will be service led lower paying jobs to supply the planned tourism developments. Non of these new inhabitants will be buying or renting condo's, especially in the high-end. And tourists visit, they don't buy or rent.
#5. Singapore is not a supply/demand driven economy. It is a small, managed economy. Thus, the property development plans were lofty, risky, and not based on future real supply/demand realities.
#6. There is a lack of real, transparent, objective information available in the Singapore market about the Singapore market. This leads to investors belief in hype and speculation rather than economic principles.
#7. Global money supplies and markets are taking a beating and will continue to take a beating. The second call on the sub prime products happens this June so more big losses are expected. This will stall or even damage the Singapore economy.
We expect distress sales in the property market to start soon. The high-end rental market is non-existent and the higher % of all unit sales were high-end investment property, speculator driven.
These buyers need "wealthy" renters to subsidize the million dollar mortgages. Most locals cannot afford the rents the market is demanding.
Surveys of multinational companies and banks have indicated that there is no boat-load of expats with a big housing allowance arriving at the Singapore port anytime soon. The new owner is now stuck with 100% of a very expensive monthly mortgage.
Here is an example of one major high-end development I'm following to prove the point. These are some very telling numbers.
600+ units launched
20+ remaining at $2,000 per square foot via the developer.
100+ units previously sold are now for sale privately less than 7 months after launch for $1,300 to $1,600 per square foot.
The reason...no rental income.
That tells me that property owners are willing to admit that market prices are down 25%+ already. Unfortunately, even at a 25% discount, there are no buyers.
Existing Singapore residents are keeping the rental market buoyant due to the fact they sold their old places and are waiting for the prices to drop...OR...waiting for their new unit to be completed. These people are relatively small in overall numbers and definitely not going to rent high end luxury units. They are driving HDB, middle priced housing rents up right now. They are also demanding 12 month leases or even less if they can get it proving that they are waiting to move or sitting on the sidelines waiting for prices to drop.
The Singapore property market is massively oversupplied today and more units are on the way. This is not good. This is should be extremely troublesome to anyone who owns property anywhere in that market. The potential valuation losses in the property market could be enormous, especially at the high-end. Overall prices could sink well below SARS levels and this could happen within 6 months to a year.
The short lived property boom was very much like a pyramid scheme.
It was all hype and no substance.
The first guys in are now smoking big cigars.
The last guys in are now left holding the ashtray. |
Let me say something , I really do not know who is Diva in this forum but I must admit I am very impressed with your analysis on the Singapore property activities. In fact you should have give yourself a nick so that we can identify it is you posting on the forum as I regard your posting to be very very useful in determining for any property purchases in Singapore. This is Phd level ... ha ha good job my fren.  |
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Guest
on 29 Apr 08 9:29 am
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| Anonymous wrote: | | Anonymous wrote: | Well...I would wait at least another 6 months to a year.
We told clients and investors to sell all Singapore holdings (property, stocks and everything else) in June 2007. We determined that prices would never, ever be higher and were predicting a 15% drop in pricing by March 2008 and 25% drop by June 2008.
Rationale was simple and not rocket science.
#1. There was no demand for housing when the boom started.
The vacancy rates on existing housing were above New York, London, Hong Kong, Tokyo and other major urban market levels. A Singapore property boom made no sense at all.
#2. Singapore GDP...nice impressive numbers. But the growth was 99% construction related. There is no economic growth when the construction boom ends and those numbers are subtracted from the total.
#3. The existing luxury housing vacancy levels in Singapore were adequate to fill the needs of Singaporeans and any possible influx of new senior executives for the next 5 years. Thus, there was no demand for executive luxury housing in the market.
#4. Value for money on Singapore property for foreign investors is not good when compared to other projected growth economies. (several factors are weighed including psf, quality of workmanship, size of economy, projected growth of economy, lifestyle and culture of the market.)
#4. The targeted future population numbers of Singapore are pie in the sky and completely without substance. Singaporeans are not having kids and the demand for jobs in Singapore will be service led lower paying jobs to supply the planned tourism developments. Non of these new inhabitants will be buying or renting condo's, especially in the high-end. And tourists visit, they don't buy or rent.
#5. Singapore is not a supply/demand driven economy. It is a small, managed economy. Thus, the property development plans were lofty, risky, and not based on future real supply/demand realities.
#6. There is a lack of real, transparent, objective information available in the Singapore market about the Singapore market. This leads to investors belief in hype and speculation rather than economic principles.
#7. Global money supplies and markets are taking a beating and will continue to take a beating. The second call on the sub prime products happens this June so more big losses are expected. This will stall or even damage the Singapore economy.
We expect distress sales in the property market to start soon. The high-end rental market is non-existent and the higher % of all unit sales were high-end investment property, speculator driven.
These buyers need "wealthy" renters to subsidize the million dollar mortgages. Most locals cannot afford the rents the market is demanding.
Surveys of multinational companies and banks have indicated that there is no boat-load of expats with a big housing allowance arriving at the Singapore port anytime soon. The new owner is now stuck with 100% of a very expensive monthly mortgage.
Here is an example of one major high-end development I'm following to prove the point. These are some very telling numbers.
600+ units launched
20+ remaining at $2,000 per square foot via the developer.
100+ units previously sold are now for sale privately less than 7 months after launch for $1,300 to $1,600 per square foot.
The reason...no rental income.
That tells me that property owners are willing to admit that market prices are down 25%+ already. Unfortunately, even at a 25% discount, there are no buyers.
Existing Singapore residents are keeping the rental market buoyant due to the fact they sold their old places and are waiting for the prices to drop...OR...waiting for their new unit to be completed. These people are relatively small in overall numbers and definitely not going to rent high end luxury units. They are driving HDB, middle priced housing rents up right now. They are also demanding 12 month leases or even less if they can get it proving that they are waiting to move or sitting on the sidelines waiting for prices to drop.
The Singapore property market is massively oversupplied today and more units are on the way. This is not good. This is should be extremely troublesome to anyone who owns property anywhere in that market. The potential valuation losses in the property market could be enormous, especially at the high-end. Overall prices could sink well below SARS levels and this could happen within 6 months to a year.
The short lived property boom was very much like a pyramid scheme.
It was all hype and no substance.
The first guys in are now smoking big cigars.
The last guys in are now left holding the ashtray. |
Let me say something , I really do not know who is Diva in this forum but I must admit I am very impressed with your analysis on the Singapore property activities. In fact you should have give yourself a nick so that we can identify it is you posting on the forum as I regard your posting to be very very useful in determining for any property purchases in Singapore. This is Phd level ... ha ha good job my fren. |
replying to own post ar
? 
no wonder got PHD (permanent head damage) |
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Guest
on 29 Apr 08 10:35 am
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| Anonymous wrote: | | Anonymous wrote: | Well...I would wait at least another 6 months to a year.
We told clients and investors to sell all Singapore holdings (property, stocks and everything else) in June 2007. We determined that prices would never, ever be higher and were predicting a 15% drop in pricing by March 2008 and 25% drop by June 2008.
Rationale was simple and not rocket science.
#1. There was no demand for housing when the boom started.
The vacancy rates on existing housing were above New York, London, Hong Kong, Tokyo and other major urban market levels. A Singapore property boom made no sense at all.
#2. Singapore GDP...nice impressive numbers. But the growth was 99% construction related. There is no economic growth when the construction boom ends and those numbers are subtracted from the total.
#3. The existing luxury housing vacancy levels in Singapore were adequate to fill the needs of Singaporeans and any possible influx of new senior executives for the next 5 years. Thus, there was no demand for executive luxury housing in the market.
#4. Value for money on Singapore property for foreign investors is not good when compared to other projected growth economies. (several factors are weighed including psf, quality of workmanship, size of economy, projected growth of economy, lifestyle and culture of the market.)
#4. The targeted future population numbers of Singapore are pie in the sky and completely without substance. Singaporeans are not having kids and the demand for jobs in Singapore will be service led lower paying jobs to supply the planned tourism developments. Non of these new inhabitants will be buying or renting condo's, especially in the high-end. And tourists visit, they don't buy or rent.
#5. Singapore is not a supply/demand driven economy. It is a small, managed economy. Thus, the property development plans were lofty, risky, and not based on future real supply/demand realities.
#6. There is a lack of real, transparent, objective information available in the Singapore market about the Singapore market. This leads to investors belief in hype and speculation rather than economic principles.
#7. Global money supplies and markets are taking a beating and will continue to take a beating. The second call on the sub prime products happens this June so more big losses are expected. This will stall or even damage the Singapore economy.
We expect distress sales in the property market to start soon. The high-end rental market is non-existent and the higher % of all unit sales were high-end investment property, speculator driven.
These buyers need "wealthy" renters to subsidize the million dollar mortgages. Most locals cannot afford the rents the market is demanding.
Surveys of multinational companies and banks have indicated that there is no boat-load of expats with a big housing allowance arriving at the Singapore port anytime soon. The new owner is now stuck with 100% of a very expensive monthly mortgage.
Here is an example of one major high-end development I'm following to prove the point. These are some very telling numbers.
600+ units launched
20+ remaining at $2,000 per square foot via the developer.
100+ units previously sold are now for sale privately less than 7 months after launch for $1,300 to $1,600 per square foot.
The reason...no rental income.
That tells me that property owners are willing to admit that market prices are down 25%+ already. Unfortunately, even at a 25% discount, there are no buyers.
Existing Singapore residents are keeping the rental market buoyant due to the fact they sold their old places and are waiting for the prices to drop...OR...waiting for their new unit to be completed. These people are relatively small in overall numbers and definitely not going to rent high end luxury units. They are driving HDB, middle priced housing rents up right now. They are also demanding 12 month leases or even less if they can get it proving that they are waiting to move or sitting on the sidelines waiting for prices to drop.
The Singapore property market is massively oversupplied today and more units are on the way. This is not good. This is should be extremely troublesome to anyone who owns property anywhere in that market. The potential valuation losses in the property market could be enormous, especially at the high-end. Overall prices could sink well below SARS levels and this could happen within 6 months to a year.
The short lived property boom was very much like a pyramid scheme.
It was all hype and no substance.
The first guys in are now smoking big cigars.
The last guys in are now left holding the ashtray. |
Let me say something , I really do not know who is Diva in this forum but I must admit I am very impressed with your analysis on the Singapore property activities. In fact you should have give yourself a nick so that we can identify it is you posting on the forum as I regard your posting to be very very useful in determining for any property purchases in Singapore. This is Phd level ... ha ha good job my fren. |
Understandable some choose to ignore got analysis and foresight...This group is call Phd( Permanent Head Damage) .....by the way two thumbs up. It has benefited a lot of people out there....Cheers |
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Guest
on 29 Apr 08 2:46 pm
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| Anonymous wrote: | | i noticed that HDB transacted prices went up in recent months in established towns like Clementi. a 3rm HDB costs around 280K and a 4rm around 400K. |
No wonder my Jurong East 5rm valuation increase from $352k to now $385k after I done my valuaton for the 2nd time after 4mths, just to know how much my unit worth.  |
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Guest
on 29 Apr 08 6:25 pm
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| short high end private properties and long low end. |
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Guest
on 29 Apr 08 6:38 pm
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go and post in HDB forum la,
here is private condo leh |
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Guest
on 29 Apr 08 6:57 pm
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| long low end condo short high end condo |
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Guest
on 29 Apr 08 7:22 pm
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| US consumers cracked. the rest of the world do not hope to de-couple |
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Guest
on 29 Apr 08 7:25 pm
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| if it is about making money, the highest yielding properties are HDB flats. |
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Guest
on 29 Apr 08 7:26 pm
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| mass consumer bankruptcies hit USA first followed by the rest of the world |
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Guest
on 29 Apr 08 7:28 pm
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| high end condos got only 1/3 chance of making money (capital gain ie price go up) and 2/3 chance of losing money (mortgage interest > rental and capital loss ie price drops) |
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Guest
on 29 Apr 08 7:29 pm
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| a HDB flat has 2/3 chance of making money (capital gain ie price go up and rental yield > mortgage interest) and 1/3 chance of losing money (capital loss ie price drops) |
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Guest
on 29 Apr 08 7:33 pm
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| the first pack to go down are the high end condo speculators. |
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Guest
on 29 Apr 08 7:34 pm
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| GREED kills a man's sanity. |
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Guest
on 29 Apr 08 7:43 pm
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| dont forget that US consumers have negative savings. They were able to spend during the last 10 years or so was due to them "consuming" their properties due to refinancing. This worked because property prices were going up in the USA back then. Now they cannot do the same. Since they have no savings, the only way to go for them is to (1) declare bankrupt and stop financing their properties and (2) no spending power. Recession will hit the world. What happened in the USA, eventually happen everywhere. Another thing to note is that we are experiencing a "blue chip" crash. |
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Guest
on 29 Apr 08 7:53 pm
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| how do you feel when you realised that you could have bought your condo $500K cheaper? |
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Guest
on 29 Apr 08 7:56 pm
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| no bank will lend you money if the banker realised that you have $800K debt against an asset of only $700K. Your credit will not be any much better than a bankrupt. |
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Guest
on 29 Apr 08 8:04 pm
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| Anonymous wrote: | | GREED kills a man's sanity. |
Then our garment should be the 1st one... twice land sales called it off... bidder bidded already... garment said is too low... so called it off...
Garment also do wish to see cheap properties selling in S'pore. |
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Guest
on 29 Apr 08 8:06 pm
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| Anonymous wrote: | | GREED kills a man's sanity. |
Then our garment should be the 1st one... twice land sales called it off... bidder already bidded... garment said was too low... so called it off...
Garment also don't wish to see cheap properties selling in S'pore. |
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Guest
on 29 Apr 08 8:09 pm
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| Singapore's government will not wish to see the HDB flat prices go down because the retirees use part of their HDB flats to pay for their Annuity. |
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