Property Prices Must Plunge (graph included)

Andy,

There will be tremendous gains if there is change
of regulation for 99 year leasehold landed property. The foreigners are used to staying at houses in their hometown and not Condos.

The bank previously only lend money for property
with lease less not less than 60 yrs lease balance. It has changed their regulation and lends money to those with min 35 yrs lease balance
last year (if not in since 2006). Hence, the potential for this type of property is good.

In fact, the price differential between 99 year
old leasehold against freehold is too big a gap now. Thumb of rule for the price difference is between 20-25%. If 99 year leasehold gap is bigger than the indicated percentage, then it is good bargain. It is of two different market segments for 99 years leashold
property as well as for freehold property.

It pays less (factoring in mortage loan interest) and less affordable for 99 year than freehold.

In fact, there are quite good landed property with 99 years leasehold selling cheaper than freehold condos. Good to have 3 storeys terrace with gardens to run about as compared to single apartment Condo.

The bank interest is of all time low now and
it is great time to lock in now. The interest savings easily offset any price reduction if it happens.

Cheers!

Hi, I need some advice here. I just bought a property the vutton for psf 1242. I'm due to exercise the option tmr but i'm wary about how the mkt is going to look going forward. I think if it goes down 20%, I will lose 100k. But if I pull out my option now, I lose 22k...It's very tough decision and any advice would be appreciated.

If you have holding power, you can considering exercising the option, but be prepared to hold long. Take a look at this story: http://www.salary.sg/2008/case-study-3-how-couple-got-stuck-with-property/
Otherwise you can try to very quickly find a buyer (maybe your agent?) willing to pay par value or slightly less, before giving up your 22k tomorrow.

I would suggest waiting another 2-3 years before going into property as an investment. See more details at http://www.waynekoh.com/2008/06/singapore-private-residential-property.html

tO sc. My advise to you is to sell it now.I am expecting the property will be bad in singapore especially 2009. Well you have to remember this rule. You can make 22k, you must also be able to lose 22k. Sell now : )

Dear blog owner.

Can you please update us with the latest graph?

Thank you very much.