Why Property market moving up?

[Chickensoup]

The local economy is not doing good with record contraction of GDP. Govt have to offer rescue packages to citizens.

 

Why then the property market is so hot? Every new launches are snapped up within days.

 

Any Reason?

[Chickensoup]

Given good HDB resale prices the dwellers upgrade to pte property but then who will in turn buy those expensive HDB resale units?

[Snowbell]

This is my take: Valuation for property have decreased.As there r not enough new HDB flats to cater for many new couples increasingly on the rise (look at the no. of new flats for sale vs the no. of applicants in HDB website & u'll knw),they're turning to resale flats.Bcoz of the decreased valuation,most buyers need not pay COV & so need not fork out extra cash & this has enticed more people to get resale flats.As there is demand,prices naturally starts to escalates.

 

In turn,as prices for HDB resale flats have gone up,people are taking the opportunity to sell their flats to use the money to upgrade to private property.As the developers have taken loan from the banks,they're worried abt the sales of the development & paying off bank loans,hence selling off the units at a lesser profit.Because of the reduction in prices,HDB upgraders r able to afford private properties,for eg selling off their 4-room HDB flat to get a 3-room private property.Because of this growing trend,there is demand once again as people tend to have the mentality that "wah now economy bad so prices of property are at its low now,good time to invest" & prices for private properties naturally shoot up.

 

And the cycle begins...

 

 

[Blackyv]

Given good HDB resale prices the dwellers upgrade to pte property but then who will in turn buy those expensive HDB resale units?

 

 

PR..........

 

[Throttle2]

The local economy is not doing good with record contraction of GDP. Govt have to offer rescue packages to citizens.

 

Why then the property market is so hot? Every new launches are snapped up within days.

 

Any Reason?

 

upgrading aside, ultimately it's becos singaporeans are very rat race type.

 

friend have i must have. he upgrade i also must upgrade otherwise no face, lose out.

 

as long as it has a fence around it, plus a pool and a gym or playground, it will be coveted. Singaporeans like to say that they live in a condo, if not, scared people look down.

 

so as long as borderline case, can pay for monthly instalment, can already.

 

in the end, they will live their whole lives, full of huge debt. anything screw, they shake.

the agents at the showroom will butter them and make them feel rich by telling them they can afford.

no problem, monthly only $xxxx.

 

but hey , nevermind cos they can say they live in a condo. that's all that matters isnt it?

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Rexxxer]

in fact,market wasn't that bad.....look at the industries now.....all are actually blooming.

But jus that analyst do not wan to say recession is over...all are jus being very conserative...

 

Further to it, shares and stocks are rising like no other business....all the investors are earning big bucks..

look at shopping malls...packed with shoppers...

 

I can say....property do dip last 2 quarters..that is the best time to buy...i did bought one private......

now price is rising....going to be like 2007...look at few projects launched....it were all grap so fast...

 

Let keep our fingers across and hope our enconoics will be positive....

[Tigershark1976]

go n check on the past hdb resale price record.... since when the hdb price drop a lot?? other than the few area where the pricing were adjusted due to the crazy hike during 07/08- eg bkt merah, tiong bahru, clementi area... other hdb pricing simply maintain or drop slightly only during the worst period (Jan 09 to May 09)

 

singapore, unlike many other countries, the buble in the residential property is almost zero... 90% of the residential property belongs to hdb... hdb have thousand and one regulations in buying the hdb. Only Singaporean and PR is allow to owned a hdb flat. and only allow to own 1 unit. This also means that foreign investor will not able to make money thru investment from hdb flat...

 

the gov require min 20% downpayment in terms to buy the hdb unit. They also require the owner to own the flat for min 5 yrs b4 they can sell the unit.... that is another control to prevent the bubbling of the property market.

 

most Singaporean are cpf rich, even durinig crisis, the cpf in the odinary acc is enof to last few a few months (or even few yrs) before the owner loss their job. just look around you and you will undestand what I meant... a few of my friends who loss their jobs have no problem with their outstanding hdb loan at all. their main worries is their daily expenses and other liability such as car & etc.

 

There are also laws where if the person gone bankrupt, his hdb flat cannot be force sale. This reduce the chances of sudden drop in the hdb pricing. Even if you owe the hdb loan, the force sale will only come in place if you fail to pay for more than 1 yr. That is why force sales of hdb flat is not commonly seen compare to other countries.

 

in countries like US, even a jobless man can buy a several property to make quick money. The bank simply approve the loan and re-package the risk and sell it to the investor..When economy crisis happen, those people who try to make quick bucks will burn their hand... their property will be sold at very low price and cause the property market to crash... with the control and prevention that the garment have, do u think this could happen?? in the 1st place, if the person have no stable job and bullet in their cpf acc, do u think hdb/ bank will approve the loan?

 

 

with all the reason above, stop hoping hdb pricing will drop more than 30% like those private property in the city area.

[Lex250]

I offer a differing view.

 

Me thinks the current property mkt rush is an excuse. Hype by developers stuck at high prices so to force the hand of buyers to pay premium. The economic fundamentals for such a fast hike is not justified. I do not belong the the gloom doom gang but I feel it is a distorted reality for now.

 

Couple this with the very local penchant for real esate speculation, I think the results are clear. I suspect when more proprties come online end of this yr and next....you won't to be the last one to find a seat when the music stops.

 

Of course my grasp of general market sentiment maybe wrong. But ask youself this. Do you really think there is a housing shortage in Singapore? What is the likely rental yield for investment property now? Also property is most likely the least liquid asset class. If you need cash fast, you're in trouble.

[Dh15]

Hmm...I am working for a big developer in SG, Fxx Exxx Org.

I would say about half of the buyers are actually foreigners, mainly from China and Indonesia. There are also those from Myanmar and India. These foreigners mostly buy the projects in the upper market and luxury sector.

Mass market projects have alot of HDB upgraders.

On top of all these, the current market sees the 1 and 2 bedroom units flying off the counter the fastest. Some of the buyers are those who made big bucks in the share market.

[Throttle2]

moving up?

 

I dont think so.

 

there are just many loud hailers.

 

and some people do get influenced by loud sounds.

 

 

dont believe, go visit fish market and watch the sellers shout.

 

hoho

[Darth_mel]

upgrading aside, ultimately it's becos singaporeans are very rat race type.

 

friend have i must have. he upgrade i also must upgrade otherwise no face, lose out.

 

as long as it has a fence around it, plus a pool and a gym or playground, it will be coveted. Singaporeans like to say that they live in a condo, if not, scared people look down.

 

so as long as borderline case, can pay for monthly instalment, can already.

 

in the end, they will live their whole lives, full of huge debt. anything screw, they shake.

the agents at the showroom will butter them and make them feel rich by telling them they can afford.

no problem, monthly only $xxxx.

 

but hey , nevermind cos they can say they live in a condo. that's all that matters isnt it?

 

 

Bro, don't rock the boat here OK ?

 

Most people would prefer to live in self-denial and self-delusion and have the gahmen screwing their lives happily.

 

 

 

[Throttle2]

Bro, don't rock the boat here OK ?

 

Most people would prefer to live in self-denial and self-delusion and have the gahmen screwing their lives happily.

 

you know i only speak the truth....

 

[Darth_mel]

The truth can hurt many people here....

 

Wait you kenna one bar like me then you know.

[Galantspeedz]

go n check on the past hdb resale price record.... since when the hdb price drop a lot?? other than the few area where the pricing were adjusted due to the crazy hike during 07/08- eg bkt merah, tiong bahru, clementi area... other hdb pricing simply maintain or drop slightly only during the worst period (Jan 09 to May 09)

 

singapore, unlike many other countries, the buble in the residential property is almost zero... 90% of the residential property belongs to hdb... hdb have thousand and one regulations in buying the hdb. Only Singaporean and PR is allow to owned a hdb flat. and only allow to own 1 unit. This also means that foreign investor will not able to make money thru investment from hdb flat...

 

the gov require min 20% downpayment in terms to buy the hdb unit. They also require the owner to own the flat for min 5 yrs b4 they can sell the unit.... that is another control to prevent the bubbling of the property market.

 

most Singaporean are cpf rich, even durinig crisis, the cpf in the odinary acc is enof to last few a few months (or even few yrs) before the owner loss their job. just look around you and you will undestand what I meant... a few of my friends who loss their jobs have no problem with their outstanding hdb loan at all. their main worries is their daily expenses and other liability such as car & etc.

 

There are also laws where if the person gone bankrupt, his hdb flat cannot be force sale. This reduce the chances of sudden drop in the hdb pricing. Even if you owe the hdb loan, the force sale will only come in place if you fail to pay for more than 1 yr. That is why force sales of hdb flat is not commonly seen compare to other countries.

 

in countries like US, even a jobless man can buy a several property to make quick money. The bank simply approve the loan and re-package the risk and sell it to the investor..When economy crisis happen, those people who try to make quick bucks will burn their hand... their property will be sold at very low price and cause the property market to crash... with the control and prevention that the garment have, do u think this could happen?? in the 1st place, if the person have no stable job and bullet in their cpf acc, do u think hdb/ bank will approve the loan?

 

 

with all the reason above, stop hoping hdb pricing will drop more than 30% like those private property in the city area.

 

I help you summarise...hopefully i am correct. The difference between private and HDB is 1 has a free hand, the other has govt intervention.

 

[Perrier]

All thanks to the DBSS, many younger couples are used to associating 500k to a new HDB. As such, private properties nowadays actually feels affordable.

 

Plus if you add the slightly higher earning power, credit cards, zero interest, people nowadays are more accustomed to debts.

[Will_I_Am]

Yeah .. a "normal" 110 sqft 5 RM HDB nowadays should cost around 300K to 350K vs 650K for a 2BR 75sqft CON-do.

You probably need to fork out 800K for one with similar size.

 

 

 

 

All thanks to the DBSS, many younger couples are used to associating 500k to a new HDB. As such, private properties nowadays actually feels affordable.

 

Plus if you add the slightly higher earning power, credit cards, zero interest, people nowadays are more accustomed to debts.

 

[Saag]

This is just a technical rebound in a downtrend, we have not seen the bottom yet.

Like crash in 1997, rebound in 1999 then found bottom in 2003.

Unemployment rate still on the way up, supply of completed units is super high in next 1-2 years.

Financial crisis has not seen the worst yet, low of stock market has not seen yet.

[Stary]

in fact,market wasn't that bad.....look at the industries now.....all are actually blooming.

But jus that analyst do not wan to say recession is over...all are jus being very conserative...

 

Further to it, shares and stocks are rising like no other business....all the investors are earning big bucks..

look at shopping malls...packed with shoppers...

 

I can say....property do dip last 2 quarters..that is the best time to buy...i did bought one private......

now price is rising....going to be like 2007...look at few projects launched....it were all grap so fast...

 

Let keep our fingers across and hope our enconoics will be positive....

 

I hate to burst your bubble dude, because the real "recession" haven't even STARTED. What we are going through now is just a whip of wind before the storm.

 

I have been saying it so often in my forum. Infact if you search around even in MCF, I have already stated since Feb that the market will rebound and oil price will climb from the then $45 a barrel to at least 3 digits by early next year.

 

It is easy to understand why the market will rebound. Where do you think the $700 billion of stimulus package will seep too? It will go into 3 areas : 1) Stock market, 2) Oil 3) Property. Oil price will lead in 2009, just like Technology leaded in 1999.

 

Local property will start moving up for the next 2-3 quarters. That's for sure. But I am afraid that's all it will last. If you look at the Property price index, the current level basically is a support level that was last hit in 2000. When an index hit a support level, it will normally rebound a bit because people think that it is cheap. But people forgotten one thing : There are far more new units and development now compared to 2000.

 

During the 2007-2008 property craze, many developers jumped into the local property market. Many new launches were made. All these units will TOP in 2010, most in 2011 and some 2012. Now the problem is this. When these units TOP, buyers will have to start paying their loan, many may have to top up their loan because the equity of their home now is far lesser than back in 2007/2008. So most will sell or some may already started selling now. The worst hit will be the 3-4 bedrooms units because it also take impact from the change in our demographic profile........the big bulk of the baby boomers are retiring/retired and they would shift to smaller units if possible.

 

When oil reaches 3 digits in 2010, it will finally burst, that will start the depression that people has been talking about. The current "recession" is nothing. Oil, property and even gold (which I advocated buying in 2004) will all crumble. Property will go back to 1998 levels of even worse. This dust won't settle until at least 2012.

 

The government has been saying that the recovery will be slow and may be really bad over the next few years. I think they got it right even though everyone seems to think the market is recovering. Recovering?? Not by a long shot.

 

To know what is going to happen to US, Europe, Singapore for the next 10 years after it started in 2010, just look at Japan back in 1990. For the next 10 years, their economy never really recovered, and even till today, their bank interest is only at 0.5% (they are still trying to stimulate the economy!!) after six years at 0%! Can you imagine getting loans at 0% interest? That's how bad it was.

 

So guys, brace yourself...if oil prices goes into the 3 digits range.....watch and prepare to run.