1994: The one and only time COEs hit S$100,000

[awhtc]

1994: The one and only time COEs hit S$100,000

FRI, APR 08, 2022 - 1:07 PM

MATTHEUS WEE

THE angry Facebook reacts are out in full force. The fear is starting to creep in. On the lips of observers all around, the same question is starting to form: Will COE premiums hit S$100,000?

To be more accurate, that question was already floating around on Wednesday (Apr 6), as it also was 2 Wednesdays ago. We know how both eventually panned out, though. Cat B and Cat E ultimately didn't cross the dreaded 6-figure line, although as some sort of perverse inside joke, the latter levelled out at S$99,999 yesterday (What is this? A twisted version of the Great Singapore Sale?). The former, on the other hand, dropped slightly - by S$500.

It's to be expected that many of us will gawk at the numbers now, but some (probably) older folk will remember: They don't actually represent the highest peaks premiums have ever scaled.

The events of 1994: Lead-up to 100k

The lead-up to S$100,000 back then wasn't so much a sudden twist as it was a slow build, begrudgingly recognised in the papers as an inevitable culmination of prices inflating across 2 years.

It's difficult to pin the phenomenon down to any single event or reason, but we can broadly focus on 2 forces acting in relation to one another.

The first: Singapore's economy was booming. Without diving into an exhaustive list of what was happening, the general sensing one may get from the period is that folks were doing well financially.

For example, CPF funds were liberalised for investment in 1993 (Ctrl + F "Basic Investment Scheme" here). The stock market was on a good run. And bank interest rates were low. In essence, people had the cash to spare, and more importantly, they were willing to part with it. (On a side note, there's also the fact that a spanking new initiative - called the "Goods and Services Tax" - had been recently announced for impending implementation... And at an exorbitant rate of 3 per cent too. We know what occurs when people fear an incoming price hike.)

But there was another issue that cannot be ignored.

Introduced as part of the Vehicle Quota System (VQS), the COE system was only 4 years old back in 1994. We grumble about it now, but there was objectively more that was wrong with it back then.

Car loans at that point had yet to be restricted, meaning that one could effectively borrow close to the full amount for a car, then spread payments out over the entire 10-year period. More importantly, speculation and market manipulation was rife among distributors and dealers with deep enough pockets. For a while, this was even fine by the authorities, who were sold on the principles of free market economics.

Flipping through the archives will reveal, in particular, that many believed regulations for the transference of vehicle ownership were too loose at that point. This enabled bigger market players to hoard COEs, and then bid aggressively to drive premiums skywards so that they could constantly offload their supply on hand at a profit.

And so, skywards they went. In December 1994, premiums in Category 4 (for luxury cars, 2,001cc and above) reached an eventual high of S$110,500. Category 3 (for big cars, between 1,601 and 2000cc) also managed to exceed S$95,000.

https://m.sgcarmart.com/articles/articleinfo.php?AID=4102&CT=e

 

[Kopites]

Was that also the time where cycle and carriage gotten into deep shit by collecting down payment with delay in car delivery? 

Let me go goggle. 😁

[Ct3833]

30 years ago.....

- our father then  were not as rich as our children's father now.

- the youngsters then are not as rich as the youngsters now 

- HDB were 200k, now no 500k no talk. $1m Resale HDB  was unheard of last time, now $1m in popular area  is cheap.

- there were not many millionaires but now there are more than 0.5m of the population are millionaire

- last but not least, SGP GDP per capita....

There are many more other there and then comparison, end of the day, COE more than 100k is expected, 150k is reasonable.

 

 

Edited April 9, 2022 by Ct3833

[yishunite]

Aiyah this current round of COE is basically $100k in all but name lah. Anyway give it 1-2 rounds sure bust, question of when not if. COE quota still dropping

[Sdf4786k]

28 minutes ago, Kopites said:

Was that also the time where cycle and carriage gotten into deep shit by collecting down payment with delay in car delivery? 

Let me go goggle. 😁

If a company that took deposits but din bid will be cbt case Liao 

[ER-3682]

41 minutes ago, Kopites said:

Was that also the time where cycle and carriage gotten into deep shit by collecting down payment with delay in car delivery? 

Let me go goggle. 😁

Yes,that time,all the Salesman switch off their Handphones,it is just before the W124 ''Masterpiece'' Time,C&C sold the Cars at $210,000,alot of Owners changed hands earning $60,000 to $70,000 a E200...my Business Friend even bought a E220 at $320,000.

[Tianmo]

Money today is no same as the money value 30 years ago. 

There is a thing call inflation.  

The population today is no same as that of 30 years ago.  

So there is a thing call supply and demand.  

Pls don't live in the present but dream of the past. 

 

[Davidklt]

It was the only time perhaps one can buy a car drive it and sell it away for more money than you bought it for.

I recall Toyota pulled an advertisement for this. 

[Voodooman]

51 minutes ago, Ct3833 said:

30 years ago.....

- our father then  were not as rich as our children's father now.

- the youngsters then are not as rich as the youngsters now 

- HDB were 200k, now no 500k no talk. $1m Resale HDB  was unheard of last time, now $1m in popular area  is cheap.

- there were not many millionaires but now there are more than 0.5m of the population are millionaire

- last but not least, SGP GDP per capita....

There are many more other there and then comparison, end of the day, COE more than 100k is expected, 150k is reasonable.

 

 

Would already be at $150k if 100% financing is allowed. 

[camrysfe]

@Davidklt 

2 minutes ago, Davidklt said:

It was the only time perhaps one can buy a car drive it and sell it away for more money than you bought it for.

I recall Toyota pulled an advertisement for this. 

I belive those who bought cars in year 2021 can sell at a profit too.

[Davidklt]

56 minutes ago, Ct3833 said:

30 years ago.....

- our father then  were not as rich as our children's father now.

- the youngsters then are not as rich as the youngsters now 

- HDB were 200k, now no 500k no talk. $1m Resale HDB  was unheard of last time, now $1m in popular area  is cheap.

- there were not many millionaires but now there are more than 0.5m of the population are millionaire

- last but not least, SGP GDP per capita....

There are many more other there and then comparison, end of the day, COE more than 100k is expected, 150k is reasonable.

 

 

 But if you look at it from another angle, people in that generation paid for cars which are almost the price of a HDB flat. 
 

3room flat : 130k

Toyota Corolla : 120k

So which generation is richer ?

[Inlinefour]

vios 100k ex lah 

 

ghost 100k sup sup water lor 🤑🤑🤑

 

compare with omv not individual wealth 

 

my 2ml worth of ron92 from peasant 🥺🥺🥺

[Enye]

nothing had changed…show off culture is still evidently present since the 1990s

😬😅

[Volvobrick]

24 minutes ago, Davidklt said:

It was the only time perhaps one can buy a car drive it and sell it away for more money than you bought it for.

I recall Toyota pulled an advertisement for this. 

I didn't make money! Used 5 years lost 5k. Very angry! 

[Sosaria]

30 minutes ago, Davidklt said:

 But if you look at it from another angle, people in that generation paid for cars which are almost the price of a HDB flat. 
 

3room flat : 130k

Toyota Corolla : 120k

So which generation is richer ?

In the early 90s, I remember my school teachers driving cars to/from work, is a quite a common thing. Salary vs living standard must be quite tok kong. 

Just goes to show that fast-forward to now, our salaries have not increased as much as inflation. So we earn more in $ figure but what we can buy has deteriorated.

[camrysfe]

33 minutes ago, Davidklt said:

 But if you look at it from another angle, people in that generation paid for cars which are almost the price of a HDB flat. 
 

3room flat : 130k

Toyota Corolla : 120k

So which generation is richer ?

the wise person would have put the money into the 3 room flat!

[yishunite]

3 minutes ago, Sosaria said:

In the early 90s, I remember my school teachers driving cars to/from work, is a quite a common thing. Salary vs living standard must be quite tok kong. 

Just goes to show that fast-forward to now, our salaries have not increased as much as inflation. So we earn more in $ figure but what we can buy has deteriorated.

Actually salary have kept pace with most things. The giant thing that overshadows all other things is property... glhf keeping up with this beast

[Voodooman]

4 minutes ago, Tianmo said:

Money today is no same as the money value 30 years ago. 

There is a thing call inflation.  

The population today is no same as that of 30 years ago.  

So there is a thing call supply and demand.  

Pls don't live in the present but dream of the past. 

 

 

$150k for a $20k Altis is still pretty excessive.