Ready for high COE?

[Sdexxxxd]

Guess we have different expectations what a tsunami means

Although there is a tsunami supply, but there is also a tsunami of demand coming up. People need to ask what will happen to the 100,000 owners whose COE expires? They won't be giving up driving right?

 

In the current system whereby the quota is based on previous quarter lagging data. With the increasing number of COE expiry, the current owners will be back to the market to replace their cars. Maybe not 100% but we just need 70% assumption that will change new car. That will keep the COE price from sliding like Tsunami.

[Hosaybo]

Guess the upcoming demand will kind of show existing drivers financial strength. If a lot of these people are on credit people due to the previous 100% loan thingy (not saying all 100% loan people have no cash but there is a reason why during that period, cara like QQ fluorish), then the pent up demand may not be as strong as expected.IMO, price will soften but not crash.

[Caravan]

From what it seems in this thread, many people who cannot or is unwilling to cough up the cash for a new car will choose the renewal option (5 year).

Now if this number is significant, there is no need for any clawback at all, since the renewed COE are not recycled back into the system and there will be lesser than expected new COEs for bidding.

Those who renew 5 years will be forced to scrap after 5 years since it is no longer renewable. These people will contribute to a new 'wave' of fresh COEs into the system 5 years or more from now.

So in short, garment don't have to do anything. Just sit back and watch the show.

[Quantum]

Although there is a tsunami supply, but there is also a tsunami of demand coming up. People need to ask what will happen to the 100,000 owners whose COE expires? They won't be giving up driving right?

 

In the current system whereby the quota is based on previous quarter lagging data. With the increasing number of COE expiry, the current owners will be back to the market to replace their cars. Maybe not 100% but we just need 70% assumption that will change new car. That will keep the COE price from sliding like Tsunami.

if public transport become good enough, part of 100k COE expired owners may give up driving,

I knew a retired couple 60s, COE expiry next year, decided to give up driving, because too stressful driving in Singapore, and public transport convenient in their estate

[Sdexxxxd]

From what it seems in this thread, many people who cannot or is unwilling to cough up the cash for a new car will choose the renewal option (5 year).

Now if this number is significant, there is no need for any clawback at all, since the renewed COE are not recycled back into the system and there will be lesser than expected new COEs for bidding.

Those who renew 5 years will be forced to scrap after 5 years since it is no longer renewable. These people will contribute to a new 'wave' of fresh COEs into the system 5 years or more from now.

So in short, garment don't have to do anything. Just sit back and watch the show.

 

Hopefully this new phenomena will not trigger another round of panic bidding as there are many people who have been waiting patiently at the sidelines. Since government said that there are going to be more COE to be released next year, but it might not come true so soon as many people intend to extend their COE thru PQP....

[Voodooman]

Guess we have different expectations what a tsunami means

My point is COE quota has doubled and COE premium has dropped from 90k to 70k, this means some have given up driving. For those insisting that COE will not dropped, they are in denial. I am not saying COE will crash but with more supply, not discounting the considerable replacement demand, COE prices should continue to weaken. I don't think it will drop below 50k as that will encourage more (including those who bought in recent years to swap to a new car) to enter the market but from now till 2015/ 2016, we should see further downward trend.

[Roh96]

The views in this thread don't generally represent the true situation of car population.

The option of renewing COE is not a popular choice to general public. You can tell from the number of vehicles that are beyond 10 yrs on the road. Even popular models like Camry, Corolla, Civic are slowly getting lesser after they hit 10 yrs, most won't renew them.

 

[Enye]

My point is COE quota has doubled and COE premium has dropped from 90k to 70k, this means some have given up driving. For those insisting that COE will not dropped, they are in denial. I am not saying COE will crash but with more supply, not discounting the considerable replacement demand, COE prices should continue to weaken. I don't think it will drop below 50k as that will encourage more (including those who bought in recent years to swap to a new car) to enter the market but from now till 2015/ 2016, we should see further downward trend.

 

agree with downward trend

 

but i don't consider this as a supply tsunami up till now