Saturday, May 21, 2011

Why property prices will fall ......soon(?)



I was watching at Robert Shiller's video on housing bubbles around the world. What strike me is the similarities in price rise and the subsequent bust among western countries. There were a few countries such as France where the govt intervened early to prevent a housing bubble that avoided much of the pain later. However, many other govts did not have the foresight and allowed the banks, developers and speculators to party on until the bubble burst and took the banking system down with it.

The charts above shows the 2nd bubble that occurred among countries with banking system intact after the financial crisis after the western housing bubble became deflated. If you compare the gradient of the price increase, the price increase in Singapore and Hong Kong  is sharper that the price rise in all of the western countries on the left.

Late last year I met a housing agent who was promoting a new condo at the bus interchange. I was quite shock at the $1200 psf price for a condo quite far from the city. The agent said that housing prices will not drop in Singapore because more foreigners are coming. While it is true that the population expansion has lead to higher demand for housing, if you look at the chart on the right, housing prices also rose sharply in Australia and Hong Kong where there is no significant increase in population size and the govt there did not open the immigration floodgates. A second reason could be figured out from ex-Minister Mah's last set of cooling measures that include restriction on how much corporations can borrow to invest in property. Foreign speculators, both individuals and corporations looking for assets to buy in a low interest rate environment, added to the demand. There is a belief that cash rich Chinese restricted by China's property curbs, went to Hong Kong to buy causing prices there to shoot to the moon and some of the buying spilled into the Singapore housing market.

While there may be many factors associated with the current rise in property prices, there is only one factor that can hold up prices in the long term - rise in median income. Tharman has said that his goal is to increase median income by 30% in 10 years. Even if he miraculously achieve this goal in 5 years, the median income rise cannot support the current housing prices. The recent cooling measures have slowed the price increase and flatten prices in certain categories of housing. While it is hard to pin-point the peak of the market, there are downside risks that one should worry about. The high housing price has caused Singapore's competitiveness to fall as cost of living rose. The global economy does look too healthy with sovereign debt problems threatening to erupt into a new crisis ...and even if there is no severe economic crisis, inflation worries have led to govts tightening up and slowing growth.

Under the PAP govt, housing has become interlinked to retirement and a fall in housing prices will have an impact on Singaporena's ability to retire. Once prices rise too quickly, history shows there are few elegant painless solutions. We can learn fromn an earlier property bubble in 1996. The govt/MAS intervened too late and when the Asian crisis came along, the prices had a long way down to fall and that led widespread problems in the economy - at that time, Alan Greenspan still had many tricks in his bag to get the global economy out of the woods...3 rapid interest rate cuts and the global economy was back on its feet in 1999.  However, we may not be so lucky the next time housing prices come down. As the cooling measures contain further gains in housing prices, this could be a market just waiting for something to happen. ....according some experts the debt levels due to property has already risen to dangerous levels:


Remember a while ago, Tharman went on CNA in a political forum with Gerald Giam and Vincent Wijeysingha plus other opposition members. When asked about the high housing cost, he said it still looked okay because the average debt servicing ratio of 28% of income is sustainable. However, if you watch the above video clip, this 28% is due purely to the articifially low interest rates we are seeing today and when interest rate rise this ratio will shoot up quickly. ...and problems can get very big very quickly.

80 comments:

Anonymous said...

No lah, we are riding the "tiger" of high property prices.

How can the government allow property prices to fall? This is like allowing people to get down the "tiger" and to be "eaten".

The only choice is to continue riding the "tiger" more slowly or just make it "stay still" lah.

Meaning just moderate or stop the rise in property prices lah.

Really no better choice lah, just as no better choice than the PAP government.

Like the saying, "The rice has already been cooked." How to reverse?

Anonymous said...

"The agent said that housing prices will not drop in Singapore because more foreigners are coming.."

Not again those unmeaningful quotes.
Since when it is relevant what the snakeoil salesman said duh?

Anonymous said...

I certainly don't mind it falling..$50K - $100k - $200k no problem.It has gotten to ridiculously high and inflated. Now the correction will restore the sanity and make it more palatable to the normal man-on-the street. This is not about status-quo for the rich landlords...time to think about the little people or you'll get not the 'arab spring', but 'singapore summer' post-LKY!

Anonymous said...

Well, all eyes are now on Khaw to see how he's going to be a game-changer or game-hanger! I hope he goes boldly and not just think of the rich foreigners..screw them! Is because of them this generation of young suffer. Bring it on Khaw, show us what we've always known about Mah & his devious reserves boosting schemes.

Anonymous said...

Too bad we can't cook the cook who cooked the rice

Anonymous said...

"The agent said that housing prices will not drop in Singapore because more foreigners are coming.."

There may be some truth in it because this is the most effective method to keep property prices high and not fall.

Because if property prices fall, many will be "eaten" by the "tiger" as what the 1st Anon said.

hayek said...

I have created a chart on M1 money supply recently. In a short span of 20 years, M1 increases 8x. Money printing accelerated since 2008.

Definitely MAS is not going to print money and distribute to poor singaporean.

The elites and banks are at the very upstream of money supply. This will explain why property price rises while the majority of Singaporean are getting poorer each day.

The problem is how the music is going to stop.

PAP seems to be complacent that with their money printing, they can sustain high property price indefinitely.

I foresee a very terrible disaster ahead of us.

hayek said...

Currently, the debasement of currency accelerated all over the world. These currency are being directed by government with the help of bankster into non-productive asset like property. But seems that hot money inevitably flows into precious metal in chagrin of elites.

We are now at a beginning of serious inflation. If business as usual, I think a tipping point will be reached, and hyperinflation will take place.

At that time, the country who revert to gold standard will be the first to achieve stability.

Under, the gold standard, there will be price stability and those incredulous housing price will be thing of a past.

Anonymous said...

I am residing in Vancouver(Canada)
and is a ex-Singaporean.As you may have heard, housing prices in Vancouver has surpassed New York and London, and is the most expensive place to live in any english speaking part of the world.
Lately we too have had a huge influx of relatively wealthy Chinese immigrants.Our immigration policies have been somewhat lax due to the low birthrate of Canadians.
The average servicing portion of
loan to income is 50% nationally.
In Vancouver,it is 75%.
Foreign firms cannot afford to locate in Vancouver and fresh
graduates are finding it hard to
land meaningful jobs.
If there is a world-wide debacle
like in 2008 again, I think Vancouver like Singapore will not be spared of the bubble bursting.
This similar fate underscores our
reliant on world trade.Sudden
massive loss of jobs will be
a blow to the housing market.

Anonymous said...

Dear Lucky
Your logic cannot be faulted.

Difficulty is to discern the trend.

Interest rates (as forecasted by 20 year USA Treasury Bond prices are going up .... meaning interest yields are coming down).

Using a global inflation proxy - Commodity prices (using the Reuters/Jefferies CRB Index) are starting to come down.

Bottom-line.
Let's live within our means.
Or in Johor.

Next chance for change is GE 2016.

Anonymous said...

Shiok man, looking forward to 10% interest rates and home prices dropping by 50%. Then plenty of people flying off from the top of their condos and HDB. Then time to buy when there are plenty of blood in the streets. Then can buy 2 or 3 condos liao.

Anonymous said...

Told you lucky can't think out of the box.

Anonymous said...

Because of limited housing in SIN and the growing wealth in this region, i believe many will be restricted to buying not more than two homes( this is already happening in some part of china). In any case, most can only afford one home so those aspire to profit hugely from boom and burst of the property market could be a thing of the past.

Anonymous said...

Property prices in Asian cities (exclude Japan) especially Singapore are probably in the last phase of mother of all bull, bubble. But this phase might last longer than expected because:
1. US Fed & China central bank still printing money like mad.
2. Too many high net worth individuals from China & India parking more money in private banking centres like Singapore partly into properties.

PAP policies of past 5 years, made the domestic asset bubble situation even more terrifying.

When population is near peak of 6.5mln. Singapore will likely go into a very prolong bear market like what Japan faced in the past 20 years.

Be prepared for some very serious super boom and bust. Recent past cycles experience likely will not be applicable. I pity young couples who bought high priced flats, they will likely suffer in future for many, many years. In 10 to 20 years many Singaporean will need to sell their flats all at the same time.

Major policies mistakes effects will only show up in the next generation.

Anonymous said...

Lucky,

I beg to differ from you.
With floodgate of foreigners opening even wider after election, tsunami of foreigners going to drown this land. Common sense tells you that property prices will rise even higher, beyond anyone imagination.

You will be caught off-guard, will regret and repent for not buying more properties in the past or now.

Instead, you should be more worry whether your job will be taken over by foreigners.

Awaken said...

IMHO, it will be a matter of risk management for PayAPrice.

We really do not know how the interest rate will fare in the next future years.

If they let the price stabilise and grow from now to 2016, the housing might be another BOO-boo by GE2016. Maybe it will be once in 20 years affair (1996 and 2016).. Hahaha..

Worse scenario will be a housing bubble in 2016 due to the interest rate hike !!!!

The safe bet is to engineer a 10 to 15 drop for now. Make the youngs happy and prevent another housing debate in GE2016. Or risk another watershed election in GE2016..

Anonymous said...

"There is a belief that cash rich Chinese restricted by China's property curbs, went to Hong Kong to buy causing prices there to shoot to the moon and some of the buying spilled into the Singapore housing market. "

A property agent in Melbourne told me the Chinese are buying up entire suburban streets of properties and paying with CASH. There is too much dirty money from China looking to be invested. Its probably the same here in Singapore, some PRs who are acting as agents for their wealthy relatives or friends in China (or India) and snapping up properties too. Whats surprising is many are earning only $2-3k a month but can afford to pay the hefty COVs or even cash up front...

Anonymous said...

In a small city like Sg without hinterland, prices oh homes are easily regulated or controlled.

Heck, if economy is bad, ride it out. Pass the word around - easy to do now a days. There is no need of panic selling. When all of us hold out, with graces from respective authorities, what can greedy pigs hope to profit from the market bursting do?

It is all good man.

Anonymous said...

People hoping that our HDB 3 rms punching beyond a million dollar can wait long long lah. and I mean not in your life time at least.

aiyah, controlling prices is a piece of cake lah in such a small country. it is ai cho or Mai cho only

Anonymous said...

only stupid ppl attack the property market.ppl like goh meng seng muahahaha

Anonymous said...

Whats surprising is many are earning only $2-3k a month but can afford to pay the hefty COVs or even cash up front..."
Anon 21/5/11 11:57

If that's the case, there is something more than meets the eye.

And this is a very serious problem if prices are kept high or higher in this way.

Lye Khuen Way said...

Some may wish that prices keep rising or at most stablise.

I have no issue wth it dropping like a rock!

1)I have only one HDB, no private or 2nd HDB unit.

2) call me selfish, but I worry for my children & their children,

3) Dr Khaw can go ahead with all the measures he thinks fit to let us have a chance to soft land.

4) better still, if he can convince Parliament to compensate those "first-timers" , be they Direct HDB buyers or 1st time Re-sale HDB buyers! Yes, from the "reserves".....

Anonymous said...

"Heck, if economy is bad, ride it out. Pass the word around - easy to do now a days. There is no need of panic selling. When all of us hold out, with graces from respective authorities, what can greedy pigs hope to profit from the market bursting do?"

Learn from developers like Far East?

They held back(from sale) many units in The Bayshore during the financial crisis period and now that the market is sweet, they are selling these units again.

You don't need to be rich to hang on to your home. You need grace to do it?

Anonymous said...

"2) call me selfish, but I worry for my children & their children,"

You are not only selfish. You are stupid.

Anonymous said...

Keep property prices at optimum level. Let's take from the rich and spread the loot.

Anonymous said...

aiyah, cheaper housing will only benefit rich ppl. better keep prices high and provide more grants at the bottom.

for the middle-class who KBKB, remember you are better off than most other countries. furthermore, not as if the money you pumped into your precious and valuable HDB will go up in smoke, aiyah why you so like that?

think long term lah

Anonymous said...

I am very skeptical When things are too good to be true.I believe we are in the last leg of asset inflation, including commodites etc. All yr money printing has to stop and reined in. This reversal will be very sharp and fast and lots of people will get hurt. S'pore is usually the first to feel effects because of our open economy. It is always good to save for a rainy day.

Anonymous said...

In 1975, a 4-room costs $18,500 while salary of new grad was $1100-1200. In 1997, the same 4-room cost $100,000 while new grad salary was $1800-2000. Now, a new 4-room is like $300,000 and new grads make $3000. Take the flat cost and divided by salary, it has gone from 16 times to 100 times base salary. This increase is not due to building material costs going up but due to a wrong land pricing policy by the Government and HDB. In 1975, most people take 5-8 years to pay off their loan with CPF. Now it will take 30 years. Mah Boh Tan had the gall to tell everyone the price of flats is still affordable based on his median salary theory. Now, after quitting, he agrees the cost has escalated. Indeed non-trustworthy. The right thing for Government to do is to refund back to those who had bought their flats the last five years.there is more much diff btw resale which a 3 room flat cost "HALF A MILLION" AT marine parade and about $400k plus in bishan toapayoh.

PS:500k for a 3room hbd flat in singapore

http://services2.hdb.gov.sg/webapp/BB33RTIS/BB33PReslTrans.

PLS REFUND BACK OUR HARD EARM MONEY.

Anonymous said...

the day when ALL 3 rms flat cost 1/2 million than say lah. Otherwise you pick and choose exceptionally cases don't count. Furthermore, no responsible gahmen shld formulate policies because of the paranoid of a few ppl with colored vision

Anonymous said...

I wonder who 13:54 arguing for? as if he or she cares for the poor. pls. dun eat bah bah liao lye pungsai

Anonymous said...

The trouble with the property boom in Spore is driven by the mass market that is the HDB and mass market condominiums. The top tier private property market are more affected by external factors and have still not recovered since the 2008 bust.

a cowboy estate agent

Anonymous said...

This is a worldwide phenomenon. The rich chinese are using ill-gotten monies to buy up properties everywhere in Australia/nz, canada, london, new york to hkg & sg. Every housing agents in those countries have talked about it widely. You want to pay particular attention to those who can pay CASH upfront. Those are typically the money-laundering ways given the casinos and rich investment firms trying to move money for their clients. Of course, what the govt is doing about it who knows...in the end, it's the ordinary man on the street that pays the price. And when pain comes to shove, that's where the revolution starts..

http://www.bbc.co.uk/news/world-europe-13481592

And they want to complain about the young being "ungrateful" & "noisy"..the SG govt should be thankful for such a compliant electorate that is giving them a 60% majority back again. If they don't put their house in order, they will boot the house out..

Anonymous said...

I hope the property would fall sharply because I am planing to buy a flat in 2 years time.

Anonymous said...

I hope the property market collapses because I want to buy several units.

Anonymous said...

Property market goes down; PAP govt goes down and GMS becomes the new PM and we shall all happily eat bananas for the rest of our lives.

Anonymous said...

Tsk Tsk Tsk.....it is not...why property prices will fall......it should be....why should property prices fall?!

Anonymous said...

America is in deep shit with ever increasing debts. They are unable to contain this massive debts. You cannot simply sweep away the problem.Let just sit and wait for the fireworks.

Anonymous said...

"Because if property prices fall, many will be "eaten" by the "tiger" as what the 1st Anon said."

Just hope that other industries including salaries can sustain the disproportionate high land / property costs (either rented or owned) to maintain competitiveness vis-a-vis other competitors.

... unless our country is actually geared to be one big property entity meant for "sales / rental" and the other industries having to play second fiddle - and so plenty of good luck to those in the latter.

Anonymous said...

we r not stupid americans. we iron money they eat money.furthermore, their leaders are better at talking than leading.

Anonymous said...

"Tsk Tsk Tsk.....it is not...why property prices will fall......it should be....why should property prices fall?!"

Tsk, tsk, tsk. It is like asking why your salaries should fall if you need to service your own property which should not fall.

So depending where you stand, one (e.g who is treating property as a revenue stream / investment) may want property to go up and another (whose primary business is treating property mostly as a cost of operation / abode).

Anonymous said...

Tsk Tsk Tsk... why should commercial properties be aligned to residential? each can operate separately in its own interests and the latter value is tied to the wealth of the populace. different types of housing for different wage brackets and all shall be inclusive, what's the prob?

Anonymous said...

"Tsk Tsk Tsk... why should commercial properties be aligned to residential?"

Tsk, tsk tsk. You should ask the ex-minister on the lesson of raiding the reserves. They don't call Singapore Inc. for nothing.

Builders London said...

It seems that there are many reasons which shows that how and why these property prices will soon.

Anonymous said...

Concur with you on this. The sub-prime crisis in the US got its dwellers for home loans in hellish chaos when the banks suddenly send a letter to inform its home loan debtors that it is increasing its interest rates on the home loans that it gave them. This went to double, triple and quadruple to the point they have to default on their homes and camp out on their trailers to survive as they could not pay for it.

Because of the sub-prime, my friends have been buying 3 room hdb flats now and want to quickly pay them off before any potential shit hits the fan and they end up servicing more interests. A cheaper house allows you to quickly finish paying it.

That is more secure than buying a 5 room and I've seen families going berserk because they could not finance it when a member of the household was retrenched.

About 30% of hdb flats have arrears of up to 4 months in bad debt to HDB.

We're in for bad times. My friend ended paying $34 000 COV on his 3 room flat in West Coast area. It's ridiculous for a 3 room. But Mah Bow Tan has fucked it up big time and guess what Mr Tan, he is no longer around to do the damage control and he is still allowed to draw a pension.

PAP is evil.

Anonymous said...

Even if you give away homes for free, people will still get into debts. When that happens, what are you gonna accuse the gahmen of? That they should print money and hand every citizen free cash but didn't ? LOL

Anonymous said...

Even if you give away homes for free, people will still get into debts. When that happens, what are you gonna accuse the gahmen of? That they should print money and hand every citizen free cash but didn't ? LOL

SIMPLE LOGIC TELL U THAT IS THIER OWN PROBLEM,THIS DEBT IS CAUSE BY GOV,AND THEY HV TO DO SOMETHING ABOUT IT.WE PAY THEM MILLION TO MAKE US IN DEBT??WHAT A WONDERFUL JOKE.

Private property vs HDB prices said...

Reading the comments, I see that there are many people who want to buy properties on the cheap. I believe this is what economist call DEMAND. This is even before accounting for the "managed influx of 900,000 immigrants".
Knowing that people are very pissed off about PRs buying HDBs, the government might limit the ability of PRs to buy HDB flats. This will create further demand in the private property sector while ensuring affordability of HDB flats.
When we tie these ideas together with cash-rich individuals having huge holding power (ie paid in cash, no need to sell), we find that property prices will be relatively well-supported.
I think the PAP's policies will now aim to make HDB flats more affordable while allowing the private property market to be subjected to "Market forces". It is not in their interest to soften the private property market because they will risk more votes with the middle-upper class, who have more than 1 property (think: Aljunied GRC).

What do you guys think?

Anonymous said...

All buyers must be credit worthy before they buy a home. There after if you get into financial problems, don't blame others, especially HDB or the govt.

Truth is, unserviceable debts are not only the plight of the poorer citizen but also the rich.

Whether 3 rms HDB or a penthouse owner, we all can get into debt.

If I am a penthouse owner and got myself into debts, should I take it out on the govt or developer?

Conversely, there are many poorer citizens who have not gotten themselves into debts over HBD purchases.

Anonymous said...

"Even if you give away homes for free, people will still get into debts. When that happens, what are you gonna accuse the gahmen of?"

True. But that is totally another separate issue and this does not negate or invalidate the current problem of high HDB prices - that even with hard work, a lot of young people will find it very difficult to afford and will take a long long in servicing their first homes, if they even qualify.

Anonymous said...

"All buyers must be credit worthy before they buy a home."

This is like reading balance sheet. Information is only good at one point of time. Do you think your own credit worthiness is cast in stone in perpetuity.

"If I am a penthouse owner and got myself into debts, should I take it out on the govt or developer?"

Who is going to kpkb for penthouse owners who got themselves into debts. Most are kpkb about the high price of hdb 'subsidised' housing - supposedly the lowest denominator.

"Conversely, there are many poorer citizens who have not gotten themselves into debts over HBD purchases."

Care to provide any official outstanding debts by HDB owners and their pay scale - this is assuming that the poor are qualified to purchase in the first place. Do you think that this is so ?

Anonymous said...

Can we create a Sg full of opportunities for our people without a critical population to sustain as many industries and businesses as possible?
I don't think so.
If we are going to inject foreigners to make up the critical number, where are the homes to accommodate this number? Private homes, which are proportionally fewer, and the price range beyond the reach of many. So these have no choice but to turn to HDB. Though there are many HDB owners who rent out rooms and entire unit, but is that enough to meet demand?
I don't think we should restrict PRs from buying resale HDB but we should tighten rules on their ownership criteria so they can't profit as much as the locals - for instance, they can't rent out their homes, etc.

This is because we need the critical number. Giving these PR a stake in our land may not be a bad idea.

Anonymous said...

"Can we create a Sg full of opportunities for our people without a critical population to sustain as many industries and businesses as possible?
I don't think so."

Let just say if there are only five or even ten farmers occupying the whole of singapore, very sustainable in their own right if there are no other people with some wise idea about 'improving their lives".

Do you think they (the farmers) need this 'critical' population to create full of opportunities which will forever changing and becoming more complex the moment you have more and more people vying for scarer and scarer piece of living and working space which will reach a point where it commands a high disproportionate of your expenditure or operational costs.

Ask yourself, do you think it is more sustainable to have 2, 4, 6, 8 or 10million people or ad infinitum in singapore. It is not just digit. The higher the number, the higher the people who may not make it. Pareto rules.

Anonymous said...

"Care to provide any official outstanding debts by HDB owners and their pay scale - this is assuming that the poor are qualified to purchase in the first place. Do you think that this is so ?"

I am sure you are able to extract the information you wanted on your own. But the situation on the ground does feel like many are managing alright.

Singapura Pundit said...

A blog dedicated to Mr Lee Kuan Yew, the Mentor of Singapore:

http://thementorofsingapore.blogspot.com/

Anonymous said...

"I am sure you are able to extract the information you wanted on your own. But the situation on the ground does feel like many are managing alright."

Managing alright ? haha !!! Then the housing minister must have 'left' on the wrong reason and all reasons for the apologies must have been 'unfounded'. you must be joking, my friend.

Anonymous said...

"Ask yourself, do you think it is more sustainable to have 2, 4, 6, 8 or 10million people or ad infinitum in singapore. It is not just digit. The higher the number, the higher the people who may not make it. Pareto rules."

If we want our children to be only farmers, yes, you are right, we may not need to drive up the population with foreign import. So why don't you ask every kid in Sg whether they want to be farmer only?

If not, what choice do we have?

Higher number does post some problems. But lower number( 3 to 4 million, assuming that is the number you are looking at, is not a small number) is not problem free either

Anonymous said...

"Managing alright ? haha !!! Then the housing minister must have 'left' on the wrong reason and all reasons for the apologies must have been 'unfounded'. you must be joking, my friend."

It's a pity he failed to defend his policies. Nevertheless, maybe it is good thst he moved on for someone else to reframe HDB.

Anonymous said...

"If we want our children to be only farmers, yes, you are right, we may not need to drive up the population with foreign import. So why don't you ask every kid in Sg whether they want to be farmer only?"

Farmer is just an analogy. By the way, you need farmers for food but farmers do not need you for food but may be trapped in a system where their labour may be underpriced but the end price of their fruits inflated by layers of privileged classes who may not need it for consumption but purely as a form of speculative / investing game.

Anonymous said...

"Higher number does post some problems. But lower number( 3 to 4 million, assuming that is the number you are looking at, is not a small number) is not problem free either"

More number, more problems and more friction as more are fighting for the same limited resource. Nothing is free of problem, it is a matter of degree / gravity.

Just use yourself for example, how many people can you manage assuming you are CEO - 1, 2, 3, 5, 10 or 15. Even one employee will sometimes give you problems.

Anonymous said...

Just hope that Minister Khaw Boon Wan will make the cost of housing as cheap and as affordable like the medicares during his reign at the Ministry Of Health.

Anonymous said...

There are some fuckers among these motherfucking working PRs who the government has allowed to take over our hdb heartlands and they are selling their flats asking for 40k for a fucking 3 room hdb at marsiling lane. Some of them have the nerve to quote these fucking COV figures of over 20k like they're selling a condo or something.

All singaporeans should not buy from fucking filipina, indo, chinaman and indiaman PRs in our country. What kind of government leadership do we have? Minster Khaw better do some damage control now that Mah has runs away...without accountability...as always, pap way.

When Mas Selamat escape, the minister also escape...not only did the minister escape, he retired without accountability and he got STATE pension out of our income tax.

Well done, you daft Singaporeans. *Claps.

When HDB flat prices were screwed to the point that young singaporean couples have to wait 4-5 years for a BTO new flat, the minister also escape....not only did the minister escape, he retired without accountability and he got STATE pension out of our income tax.

Well done, you daft Singaporeans. *Claps.

Now, let's open our arms wide wide and welcome the new foreigners who are making our mrts smell like shit and overcrowded as hell....bring on GE 2016. Or some fucking by-election lah!

If we don't give feedbacks, they will think that the ground is still sweet. That era is over...any further oppresion by this government will cost it greatly in GE 2016. And they will have to repent...at least that's what MM lee says...

Anonymous said...

Some of them have the nerve to quote these fucking COV figures of over 20k like they're selling a condo or something.
Anon 22/5/11 01:24

This is all due to market forces lah, just like high minister pay.

The top private sector pay for top talents is very high, in the millions. So we need to pay our ministers equally high lah, in order to be competitive for talents.

Anonymous said...

To solve the problem of high prices of new HDB flats

The government should:

1) With immediate effect, cut the prices for all new HDB flats by 5% and:

rebate 4% to buyers who had purchased the flats within 1 year
rebate 3% to buyers who had purchased the flats within 2 years
rebate 2% to buyers who had purchased the flats within 3 years
rebate 1% to buyers who had purchased the flats within 4 years

2)for the next 5 years (2011 to 2016)
peg the increase of prices for new HDB flats at 3% lower than the increase of average worker wage.

For example : if the increase of average worker wage is 5% for that year then the increase of prices for new HDB flats should be 2% for that year. If the increase of average worker wage is 2% for that year then the prices for new HDB flats should be decreased by 1% for that year.

With 1) & 2), we can achieve a “relative increase” of 20% between the average worker wage and the prices for new HDB flats by 2016(within 5 years).

Anonymous said...

"The top private sector pay for top talents is very high, in the millions. So we need to pay our ministers equally high lah, in order to be competitive for talents."

The private sector does not come back every five years to get elected. They provide services / products within rules / regulation (as in policies by politicians) in a competitive market (as in market forces) and the demand of their services / products is indicative of how much they should be rewarded.

Politicians seek mandate (in election) and they make rules / regulation which should be subordinate to the will of the people and not the other way and they are in a monopoly (not free market) in certain revenue collection (e.g gst, corporate and personal taxes, duties, levies, penalties, etc, etc).

Anonymous said...

Money has a cost attached to it. With the cost of money (borrowing) much cheaper than inflation rate, what does this tell us of the future? Cheaper to consume and borrow today than tomorrow. This will lead to over consumption and unproductive and risky over investment which will have medium to long term economic distortions. This will correct painfully and eventually.

The bubble does not just lie in property, it is everywhere in commodities as well.

Whilst it is cheaper to borrow today, the increase in asset price is extremely phenomenal which has already more than compensated for the low borrowing cost. When interest rate rises, what will happen then?

The fact that deposit insurance has been raised to S$50,000, where we did not have such a scheme in the past, tells us a signal. Financial institutions are taking much more risk as compared to the past. In the 1990, the cap was 35% of credit lending in the real estate sector. Now, I believe the % is much larger.

Anonymous said...

"Financial institutions are taking much more risk as compared to the past. In the 1990, the cap was 35% of credit lending in the real estate sector. Now, I believe the % is much larger."

The world is flooded with real raw talent while the real economy (not speculative & artificial) is not big enough to accommodate them & their deployment. Hence creative ideas (sometimes hollow dangerous ones) are being invented to fill the gap.

Investor said...

Its not the population
Its not the Chinese
Its not banks
Its not you
Its not me

Let me tell you the real reason why property prices keep rising and will continue to rise::::


Interest rates


Dont believe me?

Imagine what will happen if the interest rate were to rise to 6%?

Depost rate: 6%
Interest on loans: 10%


Whoah!.. it becomes very different yes?

But will it happen?

Of course not stupid!

No government in their right mind will pay deposit interest rates of 6% when US treasuries pays less than 2%.

Any government that tries it will soon run out of money within minutes!

So, just enjoy the lowest rates that will last forever! really!

I will bet my last dollar that rates will remain for the next 50 years!!

property agents london said...

Property bubble is a quite a phenomena in real estate, but according to me the housing prices will not fall in Singapore. All thanks to its growing economy, foreign investment, and the business opportunities available here. Moreover being a small country it easy to control the fluctuating housing prices and regulate them in nick of the time.

Anonymous said...

I think that home prices will fall, eventually....

Buffett said that "markets can be irrational longer then you can be solvent." He was referring to the folly of using leverage to speculate. However, looking at it from another angle, we can also see why bubbles form, because the markets can be irrational for a long long time.

Anonymous said...

Market forces will always be stronger than what the government can do. Spore is currently riding on forced growth policy. However, the median income has not risen much while property prices are riding the 'tiger'. You will never know when judgement day to cure the greed will come. When it comes, its like the wind! Just like wu song hitting the tiger with bare hands!

Anonymous said...

Responsibility issue. People made mistakes and is Rewarded handsomely while the ground people have to pay the price, in this case. Everything has a price, it just depend who pays it.

Anonymous said...

Money will lure talent. Just like what happen in US where irresponsibility talents who create the monster(sub prime) and the citizens are left to pay the price. This is TALENT. The greedy you are, the more talented you are. Talents get together to create bubbles for them to gain and citizens are left to pay the price.

Anonymous said...

Aiyah, all those people posting negative comments are looking at the glass as "half-empty" when it is really "half-full". I have a feeling these chicken-little people who think the world will end are exactly the "slow-pokes" who had missed the last property boom and are now sucking their thumbs and wishing the market to crash just so they themselves can get onboard! Ha!Ha!Ha!...Too bad for these folks! Sorry man no such luck...you've missed the boat, so you can wish all you want, but the cycle is already up up & away.
The gahmen and the rich people will make sure everything in their power to ensure property prices hold up and keep moving up because obviously they have VESTED interest in it literally. All the top politicians and millionaires are already positioned to benefit from contined property boom, so you think they will let property prices fall meh...just so to let the rest of you plebians and middle-class cattle catch up meh....No Way man! HAHAHA!. Go EAT you sour grapes....when the market is down admit it that you sore losers got NO GUTS and no balls to take action, so now Live your lives as SLAVES to the Rich & Powerful....Continue to Vote the incumbent powers, Yes, so that we can bring in more and more FTs, and push up our property prices and the Rich can make MORE, while the rest can just go sit in the corner and sulk all they want bah! HeHeHe!!!!

Anonymous said...

CEA has done a good job wiping out thousands of houses from the market by making it illegal to advertise a property without the owners' written concents . Formally property agents can advertise as many house as they like called dummy house . Then they get a buyers then they search for the house for them . Now these thousands of dummy house are not around owners starts to dictate prices to make huge profits for themselves .

anil kumar said...

Thanks for sharing points in your blog. I have read your blog. keep my some relevant informations
property in singapore
real estate singapore
bartley ridge
new launch at mount vernon

Jhon Staphen said...

Hello everyone. We provide marketing service in Singapore. We market your business in very efficient ways.
singapore marketing agency

Jhon Staphen said...

Finding the right agency that can help you with your advertising can be tough.
Marketing Agency | Branding Agency

KAREN LISA said...

singapore property are providing all of you with excellent service, whether buying or selling commercial or residential properties.

freehold condo singapore said...

Prices will definitely fall on real estate properties because of the high rates today. With high rates, nobody or few will only buy the property where the developer will suffer badly.

Portugal Property said...

Great info. I will bookmark your blog and follow your future content. So I adhere to this site for collecting some important and useful article for post and sharing with some of my friends.
Real Estate Agency
Houses For Sale In Lisbon
Property For Sale Lisbon