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

[Mercs]

Depends on whether their only property or second/third property kena enbloc.

 

If the second situation, the hurdle to get back in is 11 percent buyer stamp duties paid to ah Kong up front which will deter many from buying back a second (investment) property.

Maybe so, but i humbly beg to differ.

 

Many of these enbloc projects are done at a premium, with enbloc owners paid well above current market rates if sold individually. The premium over sale price more than sufficient to cover any stamp duties with more to spare.

 

These enbloc millionaires can buy full cash without leveraging. If they do, buying power could double, triple or even quadruple.

 

That said, while i do agree stamp duties may be a hurdle to some, for others who still believe in SG property investment as good capital appreciation will continue to do so.

 

[F10_Blackhawk]

Maybe so, but i humbly beg to differ.

 

Many of these enbloc projects are done at a premium, with enbloc owners paid well above current market rates if sold individually. The premium over sale price more than sufficient to cover any stamp duties with more to spare.

 

These enbloc millionaires can buy full cash without leveraging. If they do, buying power could double, triple or even quadruple.

 

That said, while i do agree stamp duties may be a hurdle to some, for others who still believe in SG property investment as good capital appreciation will continue to do so.

 

 

A lot of people dismiss the enbloc effect on property market.  In a normal year, ie without cooling measures (or additional cooling measures), unusual foreign participation, enbloc displaced buyers, we know there is already a steady demand for properties.  Right now, we are already seeing enbloc deals after enbloc deals.  These displaced owners will need to buy to stay somewhere.  Those who kept it for investment will probably also buy because they have tasted the rewards of property investment.  I have not seen 1 successful enblocker who did not re-invest.  I'm sure there are but most would either buy to stay (even buying a HDB has a knock on effect as it lend support to the HDB market) or re-invest.

 

And I have not even considered the return of foreign participation.  As long as they return, not necessarily to be in a big wave, our prices will be supported.  As a long term investor, i appreciate gradual increase rather than boom/ bust scenario.  And if they do return in a big way or garment open the floodgates, then i'm also quite happy to enjoy the ride. And once they have entered the market, usually they are here to park their money or make Singapore their 2nd home / new home.

 

So I really find it hard to understand why people think property prices will drop in a significant way.

[Sdf4786k]

A lot of people dismiss the enbloc effect on property market.  In a normal year, ie without cooling measures (or additional cooling measures), unusual foreign participation, enbloc displaced buyers, we know there is already a steady demand for properties.  Right now, we are already seeing enbloc deals after enbloc deals.  These displaced owners will need to buy to stay somewhere.  Those who kept it for investment will probably also buy because they have tasted the rewards of property investment.  I have not seen 1 successful enblocker who did not re-invest.  I'm sure there are but most would either buy to stay (even buying a HDB has a knock on effect as it lend support to the HDB market) or re-invest.

 

And I have not even considered the return of foreign participation.  As long as they return, not necessarily to be in a big wave, our prices will be supported.  As a long term investor, i appreciate gradual increase rather than boom/ bust scenario.  And if they do return in a big way or garment open the floodgates, then i'm also quite happy to enjoy the ride. And once they have entered the market, usually they are here to park their money or make Singapore their 2nd home / new home.

 

So I really find it hard to understand why people think property prices will drop in a significant way.

 

I would imagine, if I have heard of it being enbloc, I would also have started looking out for bargains or made arrangement.

 

This would not be a 24 hrs notification, get the owners to sign and out you go kind of situation, A small % of the owners may be hard press for cash so lets put an arbitrary number to it. Worst case 50%. But base on MCF full cash situation, probably 30% of the total owners would be hard press to cough out for a 2nd property and some may even be kiasu that the prices plunge and some owners may also be those procrastinators. 

 

I have left out those that are too old to buy another property without loan ability, so those would be the 30 to 50% group.

 

In any case, there will be some % that would only start to look at a move after the enbloc, but not so large %. But that's just me thinking out loud.

[Kusje]

I would imagine, if I have heard of it being enbloc, I would also have started looking out for bargains or made arrangement.

 

This would not be a 24 hrs notification, get the owners to sign and out you go kind of situation, A small % of the owners may be hard press for cash so lets put an arbitrary number to it. Worst case 50%. But base on MCF full cash situation, probably 30% of the total owners would be hard press to cough out for a 2nd property and some may even be kiasu that the prices plunge and some owners may also be those procrastinators. 

 

I have left out those that are too old to buy another property without loan ability, so those would be the 30 to 50% group.

 

In any case, there will be some % that would only start to look at a move after the enbloc, but not so large %. But that's just me thinking out loud.

 

You might not want to make any commitments unless its a done deal la. All you can do is go out and scout for suitable replacements.

 

80% signed doesn't mean enbloc already - all it means is that the owners agree to put the property on the market.

Bids received doesn't mean enbloc already until something is signed

5% deposit received doesn't mean confirmed enbloc already also since developer still can back out.

 

When the owner should go out and sign to buy a new property depends on individual risk appetite.

[Mercs]

A lot of people dismiss the enbloc effect on property market. In a normal year, ie without cooling measures (or additional cooling measures), unusual foreign participation, enbloc displaced buyers, we know there is already a steady demand for properties. Right now, we are already seeing enbloc deals after enbloc deals. These displaced owners will need to buy to stay somewhere. Those who kept it for investment will probably also buy because they have tasted the rewards of property investment. I have not seen 1 successful enblocker who did not re-invest. I'm sure there are but most would either buy to stay (even buying a HDB has a knock on effect as it lend support to the HDB market) or re-invest.

 

And I have not even considered the return of foreign participation. As long as they return, not necessarily to be in a big wave, our prices will be supported. As a long term investor, i appreciate gradual increase rather than boom/ bust scenario. And if they do return in a big way or garment open the floodgates, then i'm also quite happy to enjoy the ride. And once they have entered the market, usually they are here to park their money or make Singapore their 2nd home / new home.

 

So I really find it hard to understand why people think property prices will drop in a significant way.

Haha bro, bears will be bears. Remember just not too long ago, some were shouting crash/recession/retrenchment blah blah. Developers all shaking in their knees, worried cannot sell, QC charges. Then what happen ... unsold inventory all time low. Hidden agenda? Hahaha

 

So kindly allow me to debunk some of those bear theories

As mention prior, this cycle unlike previous cycles, property prices artificially suppressed with CMs. Many can buy and want to buy, just hurdled with CMs absd tdsr etc. After so many years of CMs, the demand is only getting stronger, and now with enbloc fever, even more so.

Some mention about rising interest rates, i was like ... what? Current rate 1.65% tdsr 3.5%, long way off before to have any concern.

Then we have concerns with low rental yield, yes this is valid. But then owners also pay lower bank interest which mitigate some yield losses. As and when rental goes back rosy, so will interest rates. Rental yield interim, capital appreciation ultimate.

Many of the points i've mention previously, ageing population so FTs coming is a given, not a matter of 'if' they are coming, just 'when'.

Foreign investors also sure coming, look at high end property prices around asia region, our prices looks "cheap" , due to price drop last few years/CMs.

Look at data, real stuff cannot bluff. Not just URA ... SG economy, unemployment figures, FT numbers etc, to have a more informed choice on what/where/when to invest.

Analysts talk, articles, news, you say, he say, i say ... take in the good points , filter out the undesirables.

 

More can say, cut it short, end of it all, outside noise can be of consideration but ultimately, your money, your investment, your pocket win loss, your decision ... it's all you/me.

HUAT ah!

[Roh96]

I know there are several brudders in this forum who have vested interest in property (no need to say who).

Why not share some real "huat/non huat" stories from the brudders here. I think we have read enough 'huat' articles from media. For sensitivity reason, you don't have to tell us exact $$ you have made/loss, just give in percent, the year you bought it, location, the year you sold it. 

I don't have any story to share and I am still learning from the experts here. But I hope to hear some real examples instead of reading the same usual stuff from media. Perhaps I'll start with 2 real cases from my surrounding close friends. 

 

1) Bought in 2011; Sold in 2014; Location - West Coast; Loss ~5% mainly on SSD

2) Bought in 2012; Sold in 2017; Location - Simei; Loss ~8%(didn't ask him exact amount)

 

Anyone?

[Windchoco]

I know there are several brudders in this forum who have vested interest in property (no need to say who).

Why not share some real "huat/non huat" stories from the brudders here. I think we have read enough 'huat' articles from media. For sensitivity reason, you don't have to tell us exact $$ you have made/loss, just give in percent, the year you bought it, location, the year you sold it. 

I don't have any story to share and I am still learning from the experts here. But I hope to hear some real examples instead of reading the same usual stuff from media. Perhaps I'll start with 2 real cases from my surrounding close friends. 

 

1) Bought in 2011; Sold in 2014; Location - West Coast; Loss ~5% mainly on SSD

2) Bought in 2012; Sold in 2017; Location - Simei; Loss ~8%(didn't ask him exact amount)

 

Anyone?

 

Hi bro

 

But this info doesnt really help anyone without knowing whether 

 

- The seller is the first owner of the property

- Which development

- other details like room type

 

Whereas, if you really had to zoom in on something, stuff like the transacted price lodged with URA for a specific development specific unit size, transac date etc all freely available online. (Well some is not free but data is available without "hearsay")

 

I did have a colleague who buy at the "peak" (few years ago), a new development in bedok reservoir, typical 3 rm unit, approx. 1m at purchase and now looking to sell, based on current transacted prices he said will make more than 200k if he decide to sell. Probably a benefit of the tampines ave 10 first movers.

[Invigorated]

Hi bro

 

But this info doesnt really help anyone without knowing whether

 

- The seller is the first owner of the property

- Which development

- other details like room type

 

Whereas, if you really had to zoom in on something, stuff like the transacted price lodged with URA for a specific development specific unit size, transac date etc all freely available online. (Well some is not free but data is available without "hearsay")

 

I did have a colleague who buy at the "peak" (few years ago), a new development in bedok reservoir, typical 3 rm unit, approx. 1m at purchase and now looking to sell, based on current transacted prices he said will make more than 200k if he decide to sell. Probably a benefit of the tampines ave 10 first movers.

I think it may be due to the recent DTL nearby too and I can prob guess which development you are referring to.

 

Congrats to your friend!

 

It's actually a better time to buy last year when SSD was reduced to 3 years. This is especially so for new properties. By the time it's completed, only have to wait for a while to sell off without getting penalised. Next peak is predicted by most around 2019. We'll see if this is true.

[Roh96]

Hi bro

 

But this info doesnt really help anyone without knowing whether 

 

- The seller is the first owner of the property

- Which development

- other details like room type

 

Whereas, if you really had to zoom in on something, stuff like the transacted price lodged with URA for a specific development specific unit size, transac date etc all freely available online. (Well some is not free but data is available without "hearsay")

 

I did have a colleague who buy at the "peak" (few years ago), a new development in bedok reservoir, typical 3 rm unit, approx. 1m at purchase and now looking to sell, based on current transacted prices he said will make more than 200k if he decide to sell. Probably a benefit of the tampines ave 10 first movers.

 

Not intend to dwell into the specific such as development, size etc..

Just to have a feel of the real situation around us. Are we see more gain or loss, especially those who bot after 2010.

 

Congratulations to your colleague. Making 20% gain within a few years sounds impressive. Even after deducting interest and renov, still a good gain of over 10 percent. 

[Windchoco]

Not intend to dwell into the specific such as development, size etc..

Just to have a feel of the real situation around us. Are we see more gain or loss, especially those who bot after 2010.

 

Congratulations to your colleague. Making 20% gain within a few years sounds impressive. Even after deducting interest and renov, still a good gain of over 10 percent. 

 

Ya I am happy for him also if the potential gain he said is true. But I have no doubt it is the truth that he at least will not make a loss because of the launch prices of grandeur park and the upcoming tapestry.

 

For sure there will be wins and losses in investments and hope everyone is on the winning side here.

 

Cheers.

[Theoldjaffa]

Ya I am happy for him also if the potential gain he said is true. But I have no doubt it is the truth that he at least will not make a loss because of the launch prices of grandeur park and the upcoming tapestry.

 

For sure there will be wins and losses in investments and hope everyone is on the winning side here.

 

Cheers.

 

if it's his 2nd property, then the profit is real.

 

if it's his primary residence, LPPL as he will have to pay for his next unit, where prices will have moved up in tandem with current market conditions.

 

unless he's looking to downgrade to a smaller unit, to a less desirable location or to a resale HDB and keep the profits, then congrats to him again.

[Acemundo]

Ya I am happy for him also if the potential gain he said is true. But I have no doubt it is the truth that he at least will not make a loss because of the launch prices of grandeur park and the upcoming tapestry.

 

For sure there will be wins and losses in investments and hope everyone is on the winning side here.

 

Cheers.

which devt is his?

 

to be frank i think some of the development in the east can't make so much in profit from the purchase during peak in 2013, especially those in tampines area (since you mention tapestry).  just hope it is not a case of him being overly optimistic

[Windchoco]

if it's his 2nd property, then the profit is real.

 

if it's his primary residence, LPPL as he will have to pay for his next unit, where prices will have moved up in tandem with current market conditions.

 

unless he's looking to downgrade to a smaller unit, to a less desirable location or to a resale HDB and keep the profits, then congrats to him again.

 

Yes its unfortunately his sole residential property and the next story will be more difficult. You have already mentioned the options he is considering.

 

Maybe ppl here can advise?

 

 

@Ace: If I unknowingly bought at the peak I would be relieved to get out of jail. More or less explains why I am happy for him. Far East Bedok revervoir. Dunno which 1.

Edited February 23, 2018 by Windchoco

[Agent008]

 

For the full year, resale prices of condos and private apartments climbed 6.3 per cent in January from the year-ago period, and are now off just 1.2 per cent from their last peak in January 2014.

 

All locations saw price appreciation year-on-year, with the CCR, RCR and OCR recording increases of 5.6 per cent, 9.7 per cent, and 4.4 per cent respectively.

 

http://www.businesstimes.com.sg/real-estate/condo-resale-prices-rise-1-in-january-63-y-o-y-srx-property

Edited February 23, 2018 by Agent008

[Acemundo]

Yes its unfortunately his sole residential property and the next story will be more difficult. You have already mentioned the options he is considering.

 

Maybe ppl here can advise?

 

 

@Ace: If I unknowingly bought at the peak I would be relieved to get out of jail. More or less explains why I am happy for him. Far East Bedok revervoir. Dunno which 1.

oh ok waterfront waves i think....

 

that one still got hope.......if tampines or changi area, i very much doubt it.

 

yes, i do agree with you.  if bought in 2013, can get small gain already happy,  if big gain sure quickly sell.

[Invigorated]

Actually some units bought last few years may already see slight capital appreciation.. but factoring in legal fees, finance charges on loan on early redemption, renovation costs and bsd, certainly not worth the effort and risk of having to pay more for another unit too..

 

plus bsd, ssd and reno costs on the next unit too, regardless of an upgrade or downgrade.

 

It will only be worthwhile enough if one is looking at a strong profit margin.

 

Hence one must usually be in for the long haul when it comes to property purchase.

[Mercs]

https://www.propertyguru.com.sg/property-management-news/2018/2/169498/buyer-optimism-returning-to-the-singapore-residential-market

Buyer optimism returning to the Singapore residential market

Feb 22, 2018

 

(More Singaporeans are satisfied with the current real estate climate, even though 67 percent anticipate condo prices to increase in the next five years)

 

The latest PropertyGuru Consumer Sentiment Survey gives one much to cheer about. Buyers’ sentiment is the highest since 2013, indicating that the Singapore residential market may be finally out of the woods. In the latest survey conducted in H2 2017, 37 percent of respondents indicated that they are satisfied with the real estate climate in Singapore, up from 34 percent in the previous survey done in H1 2017.

 

The higher satisfaction level is largely due to anticipation of long-term capital appreciation (45 percent) and the prevailing low mortgage rates (30 percent). Additionally, 28 percent of respondents indicated that Singapore has a stable and resilient real estate market.

 

 

Prices still perceived to be high and expected to climb higher

 

The dissatisfaction of respondents’ stem from the perception that residential property prices is still high, with 37 percent citing high prices as the top deterrent for not purchasing a property. In addition, a record-high 46 percent of respondents think that prices will increase further.

 

Among the different residential types, condominiums have the most respondents (67 percent) expecting a price increase in the next six months, up from 57 percent in the previous survey.

 

More respondents expect condominium prices to increase in the next five years. 72 percent of them indicated that condominium prices will increase and 26 percent of respondents expect prices to increase by more than 10 percent.

 

 

Mixed view for rents

 

While price increases are on the cards, the picture for the rental market is less clear. Across the different residential types, equal percentages of respondents expect rents to increase and decrease in the next six months. The still high vacancy rate coupled with the rise of disruptors such as Airbnb could have contributed to the uncertainty in the short-term rental market.

 

However, the picture is more optimistic for the long-term rental market with more than half (51 percent) of respondents indicating that rentals will increase in the next five years, much higher than those expecting rentals to decline (21 percent).

 

 

Strong intention to buy

 

About half of the respondents intend to buy a residential property in the next six months. The purchase intent for condominiums has increased most strongly compared to other property types. This could be driven by replacement demand from homeowners who successfully sold their homes via en bloc sales. In addition, the returning optimism in the residential market may have convinced some buyers to take the plunge before prices rise further.

 

Districts 15 (East Cost and Marine Parade) and 11 (Newton and Novena) proved to be the most popular, with 44 percent of respondents planning to purchase a property in these two districts. In addition, 71 percent of them have at a budget of at least $750,000.

 

Among those who intend to buy a property, proximity to their workplace and amenities such as malls, parks and schools are key deciding factors. Home buyers also cited size of bedrooms as well as orientation and age of the unit as their main considerations when choosing a unit.

Edited February 23, 2018 by Mercs

[Mercs]

http://www.straitstimes.com/business/property/buyers-stamp-duty-hike-may-translate-to-higher-prices-for-new-projects-redas

Buyer's stamp duty hike may translate to higher prices for new projects: Redas

Feb 23, 2018