Private Property prices......still up or down? Part II

[Mcscot]

This is what driving the mass condo sale and I sincerely hope it will not crash. If we build enough HDB to house our citizens and economy does not attract FT to rent, then we will see the real property market. The high end property will never have such issues. 

 

I totally agree with you that the high-end property may not have these issues but usually these are people who have 2-3 properties so I think a potential domino effect.

 

I am very very concerned that this market is set up for an EPIC "dive" but I hope not cos it affects everyone ... noone will be spared.

 

I hope some Bros in here can provide some stats to tell us otherwise.

[Wt_know]

property is unlikely to crash with “invisible hand” else popular votes will be affected

 

hdb price must go up ... all the rest will follow ... huat ah!

Edited March 18, 2019 by Wt_know

[Enye]

You never read the Property Agent story meh?

 

Targeting rental yield of only 2%.... crazy...

 

I really don’t understand all those people who bought new. There are some in this forum... the rental yield must be peanuts plus the initial years of depreciation because of new leasehold...

 

wah..i thought you just bought a resale unit?

 

what yields are you targeting?

 

   

I totally agree with you that the high-end property may not have these issues but usually these are people who have 2-3 properties so I think a potential domino effect.

 

I am very very concerned that this market is set up for an EPIC "dive" but I hope not cos it affects everyone ... noone will be spared.

 

I hope some Bros in here can provide some stats to tell us otherwise.

 

don't worry ...ah gong is omnipotent

 

gurus here say just remove all cms and import more to hit 10 million people on this little island

 

property will chiong 5-10% pa to infinity and beyond

 

 

[Invigorated]

I have MAJOR concerns ... in that article ... most if not ALL buyers were purchasing for "investment purposes" which means that they will be looking for tenants in the future.

 

When the market is flushed with condos for lease with few or worse no takers (looking at the current climate!) ... there is only 1 way the property market will go.

 

Sorry ... I don't have stats to back this up (ie supply vs demand) but this is based on a lay person's view of what is the situation.

I can't really get why one would take a reporter's view as an assumption that most if not all buyers were purchasing for investment purposes.

 

You seem to already have your own perception that this is true, even though data isn't present yet or is holding up at all.

 

first, this report is only based on a few interviewees and there may be many owner buyers that he has not included. The reporter has his own agenda on what to present and it's definitely not going to represent the market. The sample size is too small.

 

Next, some of those who say they may buy for investment may not even follow through with it.

 

 

MAJOR concerns? You bought one? What's major about your concern if you're not going to be affected?

 

Most if not ALL are buying for investment? This is Tamp and it's not very near even the mrt, I wouldn't say rental demand is even strong and it would be more convincing that there will more owner buyers. But this is also only just my take. Time will tell as usual.

[Icemaiden]

High End property has been in the doldrums with even worse yields and insipid capital gains. I have seen so many high-end freehold properties and the rental that they can command is pathetic. Nowadays many tenants prefer having a gated community with large open spaces and many facilities and lifestyle is more important. The single or double block min facility small pool type of high-end condos are losing its charm from a lifestyle perspective. 

 

 

I totally agree with you that the high-end property may not have these issues but usually these are people who have 2-3 properties so I think a potential domino effect.

 

I am very very concerned that this market is set up for an EPIC "dive" but I hope not cos it affects everyone ... noone will be spared.

 

I hope some Bros in here can provide some stats to tell us otherwise.

 

Edited March 18, 2019 by Icemaiden

[Acemundo]

First weekend preview ... 7,000 strong chiong ah!

 

https://www.todayonline.com/singapore/packed-showroom-treasure-tampines-opening-weekend

Thousands pack showroom at Treasure at Tampines’ opening weekend

 

 

i wonder which investment school taught these people that paying 12% upfront absd is worth it or for that matter, the long period to break even from the absd paid.

You never read the Property Agent story meh?

 

Targeting rental yield of only 2%.... crazy...

 

I really don’t understand all those people who bought new. There are some in this forum... the rental yield must be peanuts plus the initial years of depreciation because of new leasehold...

exactly my thoughts when i read that article.  i was thinking 2% yield only and they think it is glamourous enough to be featured on the st investment page. and he said he targeted 10-20% capital appreciation for his sengkang condo......not easy, may take a long time.

 

overall i don't find this case worthy enough to be mentioned as case study for property investment.  the only special thing about this case is that he is relatively young, that's all.

[Wind30]

wah..i thought you just bought a resale unit?

 

what yields are you targeting?

 

 

 

don't worry ...ah gong is omnipotent

 

gurus here say just remove all cms and import more to hit 10 million people on this little island

 

property will chiong 5-10% pa to infinity and beyond

 

Assuming 0.5 months agent fee, 0.5 months vacancy a year, minus off maintenance, tax, air con servicing, the yield is 2.5%. But i got a high rental for the next 18 months. If I take current pricing, yield is closer to 2.2%.

 

Freehold resale so hopefully the depreciation is less.

 

I would expect yield for new leasehold to be better than this else how u handle the high initial depreciation?

[Icemaiden]

With grab and other private hire apps, the value of MRT is declining. Similarly the need to be near to makan places with deliveroo and grabfood etc. is declining. With online shopping, the need to be near Orchard Road is also losing its favor.

 

Nowadays I believe the most important is

 

(i) close to city center and work places (reduce travel time and more time for family etc.)

(ii) beautiful surroundings for lifestyle, near sea or near nature parks etc.

(ii) large gated open space with fields, entertainment space etc.

(iii) Adequate facilities

 

 

 

 

<400m isn’t so common, so I guess that figure means something that can be translated into a true commercial value.

 

[Showster]

Assuming 0.5 months agent fee, 0.5 months vacancy a year, minus off maintenance, tax, air con servicing, the yield is 2.5%. But i got a high rental for the next 18 months. If I take current pricing, yield is closer to 2.2%.

 

Freehold resale so hopefully the depreciation is less.

 

I would expect yield for new leasehold to be better than this else how u handle the high initial depreciation?

First 10 years immediately available new facilities with warranty appreciation will easily overcome and exceed very marginal lease depreciation. Edited March 18, 2019 by Showster

[RogerNg_185295]

Which  area in Singapore has it?

With grab and other private hire apps, the value of MRT is declining. Similarly the need to be near to makan places with deliveroo and grabfood etc. is declining. With online shopping, the need to be near Orchard Road is also losing its favor.

 

Nowadays I believe the most important is

 

(i) close to city center and work places (reduce travel time and more time for family etc.)

(ii) beautiful surroundings for lifestyle, near sea or near nature parks etc.

(ii) large gated open space with fields, entertainment space etc.

(iii) Adequate facilities

 

[Spring]

First weekend preview ... 7,000 strong chiong ah!

 

https://www.todayonline.com/singapore/packed-showroom-treasure-tampines-opening-weekend

Thousands pack showroom at Treasure at Tampines’ opening weekend

 

 

Last time, I was shocked when condos had more than 1000 units eg Sims Urban Oasis. Now it becomes 2000+! Facilities will get congested n the privilege of staying in a private condominium gets thrown out of the window as it’s not exclusive any more. Pool might become a public pool in next to no time!

[Wind30]

First 10 years immediately available new facilities with warranty appreciation will easily overcome and exceed very marginal lease depreciation.

?? I totally have no idea what you are talking about.

 

Nus has published a previous study on the depreciation based on age. Common sense will also tell u a new car depreciate the most in the first few years.

 

You have to pay something to use the shiny new facilities which will become old and used in 10 years.

 

That is why there is a premium placed on new launches vs resale. And rest assured you will lose that premium once it becomes resale.

[Wind30]

I am curious what are the rental yields you guys are getting with your recent property buys in the last 8 years?

 

I removed 1 month of rent in total for agent fee and vacancy annually.

 

Also deducted tax, maintenance, and air con servicing.

 

My gross yield without deducting all the above is 3.3%. After deduction is just 2.5%. And the rental prices have is on the high side.

Edited March 18, 2019 by Wind30

[Icemaiden]

Actually I think one cannot just judge by number of units without looking at the land size. If a condo has a land area of 1 million sqft and has 1000 units, it means each unit actually owns 1000sqft of land. As compared to another condo with land area of 100,000 sqft but has 200 units, each unit effectively only owns 500sqft of land only. So which one is more over crowded?

 

Also recent trends seem to indicate that some tenants / owners prefer larger condos sitting on a large plot where r enough open space for children to run around, playgrounds, dog runs, large pools, minimart etc, and everything within a large gated secure community. Certain expats also prefer condo with a friendly community for children playgroups etc. There are some "exclusive" condos where the pool is so small and can't even accommodate 2 swimmers comfortably. There are also some condos with not enough land area within the condo grounds, such that one has to run or walk the dogs on the main road and breathe in fumes.

 

So overall, I try not to judge number of units without looking at the land size.

 

 

Last time, I was shocked when condos had more than 1000 units eg Sims Urban Oasis. Now it becomes 2000+! Facilities will get congested n the privilege of staying in a private condominium gets thrown out of the window as it’s not exclusive any more. Pool might become a public pool in next to no time!

 

Edited March 18, 2019 by Icemaiden

[Eric3417]

I am curious what are the rental yields you guys are getting with your recent property buys in the last 8 years?

 

I removed 1 month of rent in total for agent fee and vacancy annually.

 

Also deducted tax, maintenance, and air con servicing.

 

My gross yield without deducting all the above is 3.3%. After deduction is just 2.5%. And the rental prices have is on the high side.

For myself i don’t use my purchase price of the property to calculate my nett returns. I use nett rent / capital invested. Ie: My nett rental returns on capital invested after less bank interest, agent comm, property tax, mgt fees, fire insurance & the odd stuffs varies from a low of 5.5% to 8.5%. I consider this returns satisfactory not taking into potential CA gains.

Actually I think one cannot just judge by number of units without looking at the land size. If a condo has a land area of 1 million sqft and has 1000 units, it means each unit actually owns 1000sqft of land. As compared to another condo with land area of 100,000 sqft but has 200 units, each unit effectively only owns 500sqft of land only. So which one is more over crowded?

 

Also recent trends seem to indicate that some tenants / owners prefer larger condos sitting on a large plot where r enough open space for children to run around, playgrounds, dog runs, large pools, minimart etc, and everything within a large gated secure community. Certain expats also prefer condo with a friendly community for children playgroups etc. There are some "exclusive" condos where the pool is so small and can't even accommodate 2 swimmers comfortably. There are also some condos with not enough land area within the condo grounds, such that one has to run or walk the dogs on the main road and breathe in fumes.

 

So overall, I try not to judge number of units without looking at the land size.

I agree bcoz i have a unit here. The 2 large pools even on weekends are still relatively usable. And a fair amount of common areas & other facilities for ppl to gather, walk their dogs, chill etc.

[Spring]

Actually I think one cannot just judge by number of units without looking at the land size. If a condo has a land area of 1 million sqft and has 1000 units, it means each unit actually owns 1000sqft of land. As compared to another condo with land area of 100,000 sqft but has 200 units, each unit effectively only owns 500sqft of land only. So which one is more over crowded?

 

Also recent trends seem to indicate that some tenants / owners prefer larger condos sitting on a large plot where r enough open space for children to run around, playgrounds, dog runs, large pools, minimart etc, and everything within a large gated secure community. Certain expats also prefer condo with a friendly community for children playgroups etc. There are some "exclusive" condos where the pool is so small and can't even accommodate 2 swimmers comfortably. There are also some condos with not enough land area within the condo grounds, such that one has to run or walk the dogs on the main road and breathe in fumes.

 

So overall, I try not to judge number of units without looking at the land size.

You have a point on looking at overall land area but I believe it would be more or less there ie total land area divided by 2000 units would be about same as 500 units which I think is the optimum size but that’s my opinion cos I prefer facilities to be less congested vs open space.

 

Wanted to play tennis at my friend’s condo at sims urban oasis but he can nvr book (1 court only) unlike sky vue where I currently play which has also 1 court only but cos much less units so can get court almost every time.

[Angcheek]

You have a point on looking at overall land area but I believe it would be more or less there ie total land area divided by 2000 units would be about same as 500 units which I think is the optimum size but that’s my opinion cos I prefer facilities to be less congested vs open space.

 

Wanted to play tennis at my friend’s condo at sims urban oasis but he can nvr book (1 court only) unlike sky vue where I currently play which has also 1 court only but cos much less units so can get court almost every time.

 

Can book the tennise court  .............. all u need is to book it 1 year in advance . 

 

If that day rain then too bad     can always look for @radx drink Teh Su Su ... 

[tomyamho]

Depends on which segment you are looking to invest in. Also, location location location is veh impt

Currently I fetch around 1.6% net Yields after minus-ING loan and other expenses. OK bahs. Some of my other fwens are in -tve cash flow.