Singapore Private Property prices still up or down? Part III

[Rskc]

12 hours ago, Mm63 said:

 

Hi,

You mentioned that looking at the table from Dp26's post, it seems like investment properties of over 10 years or more have better returns.

When I look at the table, I see a pattern where the sellers in almost all of the profitable transactions (except 2) bought before 2010 and all of the sellers in all of the unprofitable transactions bought in 2010 or afterwards. Just to be clear, the table is only a small sample of overall transactions but does it represent the general trend in the market?

Some will argue that this is due to the numerous cooling measures in place that is "artificially" keeping the market relatively flat. Others will argue that the high property appreciation rates from yesteryears are over.

Open for discussion........

Yup. The sample size is small. Agree with you that the CMs are distorting the market and we nvr guess what govt is going to do next. It reduced SSD period in 2017 and market shot up in next 2~3 qtrs and then the sledgehammer came and prices stayed there since.

This is the reason I feel that if IRR base case is indeed 3% (based on mm63) and best case is 8% and one's horizon is long enough, he might be able to see the light. The debate is if 3% is base case. It could get lower. Next year is key.

Of course, being all others equal, location is impt. 

Edited October 20, 2020 by Rskc

[Throttle2]

Lets face it, the reality is that properties no longer provide the kind of yield which makes a fair investment for what it is.

so gone are the days

secondly, the capital appreciation is also sporadic and unlinear and a best unknown in todays world.

in terms of liquidity, property sucks

in terms of commitment, property is a killer long term burden on the shoulders.

 

but why why why do people still scream shout Properties!!!

because as rightly pointed out, it is the one asset class that allows high leverage over long periods

For such “schemes” to work, must ensure the waves keep coming , like ponzi . Otherwise, house or cards will crumble.

properties huat ah! Wan sui

[Icedbs]

1 hour ago, Mm63 said:

 

Based on your exercise in determining the top 5 best value launches, would you agree that 10+% capital appreciation over 3 years is more of an exception than the norm?

Like all things in life, there is no sure thing, not to mention an investment instrument.

All we can do is do our own homework and stack the odds in our favour.

 

[Throttle2]

6 minutes ago, Icedbs said:

Like all things in life, there is no sure thing, not to mention an investment instrument.

All we can do is do our own homework and stack the odds in our favour.

 

Fair enough, so to each his own still at the end of the day

[Kaka23]

16 hours ago, Arcachon said:

 

Which is better for your money in CPF earn 2.5% or reduce your Principal by $60,751.16.

Add Property Tax, Agent Fee, Maintainance Fee, renovation, fire insurance, etc.

After 3 years you sell at 1 million.

 

I took the purchase figures off your table. Since you are a registered salesperson, care to comment on my calculation?

There is a cash outlay of $1208 per month for mortgage and the final balance is base on an assumption of property growth of 3% per annum, which I think is the tricky part.

[kobayashiGT]

6 hours ago, Wt_know said:

for a straightforward discussion ... let's ignore CPF

$300K full cash ... what to invest?

buy $1M investment property or put $300K into Reits (real estate investment trust)

One earns rental, one earn dividends.

Give me I take dividends, free myself from all the legwork and concnetrate on earning my next $300k.

[ToyotaShuttle]

12 minutes ago, kobayashiGT said:

One earns rental, one earn dividends.

Give me I take dividends, free myself from all the legwork and concnetrate on earning my next $300k.

Depends how you see property prices moving as well. Reits is more liquid but physical property, you can leverage your 300k by taking loan.

Not that you can't get leverage to invest your 300k.

[Dp26]

I can see why there are so many ppl interested in the thread or property investment yet haven’t act on their purchase.

they calculate the numbers and are not convinced themselves. They are others here that try to show the way, but unfortunately talk half here half there. (See the numbers, feel the magic, 😏.)

I’m interested cos I’m not convinced also and am hoping to see the “enlightenment” 

I’m convinced that borrowing or leveraging is a useful tool but once the LTV drops(2nd/3rd property) it becomes less attractive.

i also always wonder why ppl can do so many assumptions on property investment; rental @ 3%pa, growth @ 5%pa blah blah blah and is totally fine with it. (The numbers that dont lie and will be there are the taxes)

History also told me if i put my money in stock X or stock Y or index X or index Y, i will be many dollars better than today. Should i go around telling ppl that they are doing right/wrong and so forth? Everyone is different so I cant assume they can or want to do the same. And i cant guarantee that the dividend will be there nor the growth will be like what it is for the last 20-30 years. Nobody can guarantee the future right?

 

I have a good friend that is super into property investment and we always have interesting conversations everytime we catch up. He’s one of those that also attends property seminars and talks. He is adamant that he will be a multiple landlord in the near future and that’s the ‘end game’ for his investment/retirement portfolio. In the last 10 years, he has bought/sold/upgraded 2 properties and made some money in the pocket. Recent years he also starts to get a bit interested in the stock market and follows the same characteristics or acumen of his property investment. (This one good, dividends strong, up 10% sell blah blah blah) 

told him to replace the property with this particular stock that he’s pretty convinced and use the same leveraging spreadsheet he has and make a calculation base on his own projection on dividends and growth. Suddenly his eyes light up. He was ever so convinced that property is the only way to go.

Property is good, but not the only way to go.

 

 

TLDR: many road leads to rome. 

Views are personal only, sorry for the lengthy post. 

[Rskc]

2 hours ago, Arcachon said:

Will you buy knowing the CMs are distorting the market or will you wait when the CMs are removed and the market return to normal.

The Half-empty will see the distortion as bad.

The Half Full will see an opportunity.

Back to Basic, simple mind thinking. Can buy don't buy wait for what?

 

CMs created a good buffer for the current crisis. Without them and govt's loan measures, property would been collapsed like previous crisis.

Whether it is a good time to buy, it depends on one's risk appetite. 🙂

[Kaka23]

3 hours ago, awhtc said:

The only way to make serious money from property now is to buy new launch and flip or be the property agent. 

https://www.edgeprop.sg/property-news/buying-new-condo-units-isnt-profit-guarantee

I dragged my parents down to Highpark during launch and persuaded them to get a unit at $8xxpsf. My heart sank a little when next door Parc Botannia was launched at $11xxpsf.

 

[Showster]

5 hours ago, Arcachon said:

Agree, which is riskier, during property Boom time or during the crisis. 

 

There are some truths in this as well. 

With the equity loan funds and personal savings, I switched some stocks held and bought some more, doubling the value of my cash holdings today.

But still not enough to qualify to buy one more property, unless cheap industrial / commercial for now...

Some people will wait for 2021 (both housing and equity). Then they will wait for 2022...

The weirdest truth is, it will never make full sense at the point that you buy. It didn't make sense in 2006 when I bought my first, 2012 when I bought my second, and 2015 when I got the third. For each property, it only STARTS to make sense minimum 3-5 years later. By the way, all three are bought as new property (firsthand). 

Edited October 21, 2020 by Showster

[kobayashiGT]

53 minutes ago, Kaka23 said:

https://www.edgeprop.sg/property-news/buying-new-condo-units-isnt-profit-guarantee

I dragged my parents down to Highpark during launch and persuaded them to get a unit at $8xxpsf. My heart sank a little when next door Parc Botannia was launched at $11xxpsf.

 

The only time I drag my parents to is to wet market. 🤣

[Dafansu]

1 hour ago, Kaka23 said:

https://www.edgeprop.sg/property-news/buying-new-condo-units-isnt-profit-guarantee

I dragged my parents down to Highpark during launch and persuaded them to get a unit at $8xxpsf. My heart sank a little when next door Parc Botannia was launched at $11xxpsf.

 

High Park is one of the top earning projects. It was launched when everyone fear buying and when everyone was expecting pricing to drop further. 

[Rskc]

2 hours ago, Showster said:

There are some truths in this as well. 

With the equity loan funds and personal savings, I switched some stocks held and bought some more, doubling the value of my cash holdings today.

But still not enough to qualify to buy one more property, unless cheap industrial / commercial for now...

Some people will wait for 2021 (both housing and equity). Then they will wait for 2022...

The weirdest truth is, it will never make full sense at the point that you buy. It didn't make sense in 2006 when I bought my first, 2012 when I bought my second, and 2015 when I got the third. For each property, it only STARTS to make sense minimum 3-5 years later. By the way, all three are bought as new property (firsthand). 

Wow, you seemed like talking abt me. Hahaha.👍I belonged to the "wait" group previously. Then when I decided to start buying, no matter it is my hdb or condo, they never make sense at point of purchase. I was in fact laughed at. 🤣🤣

I may sound like pro property (long horizon) but I am also very pro dividend stocks. 😉

[Invigorated]

23 minutes ago, Rskc said:

Wow, you seemed like talking abt me. Hahaha.👍I belonged to the "wait" group previously. Then when I decided to start buying, no matter it is my hdb or condo, they never make sense at point of purchase. I was in fact laughed at. 🤣🤣

I may sound like pro property (long horizon) but I am also very pro dividend stocks. 😉

Not referring to you but many would use 'but' and 'or' when referring to both property and stocks.. personally I think the two asset classes are not mutually exclusive as diversifying is key.

Sure, if one has to pay 12% absd, property doesn't make sense as an investment I feel as upside wouldn't be worth it. I would go for reits instead then.

The million dollar question is, if you have one transferred to a wife's name, would it be beneficial to get another then? I would personally go for it then as the long term horizon is still positive with undervalued properties here. Interest rates also remain attractive. There's nothing stopping one from getting stocks for a good balance of their own portfolio.

[Wt_know]

[Throttle2]

People who blindly buy when it didnt make sense are stupid and pure lucky if they dont get into trouble. we have seen and known many of such people, relatives, friends. But one day their luck will run out.

I bought 4 properties in the last 20yrs and everytime, i was very clear why it made sense.  I was just as clear why it made sense when i sold them too.    And everything turned out pretty much as planned and precisely executed.

When the Govt came in with the CMs, i increased my stake in financial investments and reaped the rewards as well.

money is never ending to make.  Its what you do to make it and how that translates to a good night’s sleep.

i know what i need to do for my good night’s sleep and i wont exchange it for other things.  

How about you? 

😄😎

[Rskc]

When it does not make sense to most, it does not mean it did not make sense the few others. 😄