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Whats your net worth

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  #501 (permalink)  
Old 25-12-2011, 10:28 PM
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50 years old.
Earns a lowly $90k a year.
Owns a fully paid $900k condo.
Savings and investments of $500k.
Thinking of retiring in a 3rd world country.
What do you think?
Which 3rd world country are you thinking of?

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  #502 (permalink)  
Old 26-12-2011, 10:26 PM
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I know of stupid people who sold their property in 2007 and started renting. When prices fell in early 2009, they did not buy because they said prices will fall further. I told them that prices will recover fast but they didn't believe me. Now they are all worried as prices continue to rise. Now they are buying before their cash got burnt out.
When they start buying, then prices will come down.

Not so soon. We are now at 1990, when prices just exceeded the previous peak in 1984 after many years. A lot of people are still hesitating on the sidelines thinking that prices had peaked because it exceeded the previous peak.

Still 6 more years for property to triple in price.



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  #503 (permalink)  
Old 26-12-2011, 11:47 PM
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When they start buying, then prices will come down.

Not so soon. We are now at 1990, when prices just exceeded the previous peak in 1984 after many years. A lot of people are still hesitating on the sidelines thinking that prices had peaked because it exceeded the previous peak.

Still 6 more years for property to triple in price.

Simple question ... Where's the stimuli for this ?

-Interest rate ? No already all time low.
-govt policy? No, govt is doing all it can to bring down prices with repeated cooling measures
-lack of supply? No, huge supply coming on stream both from existing developments and new land sites releases
-affordable property prices? No, Singapore property is way way overpriced by every fundamental measure, both in absolute terms and compared to historical ratios in 1990

It's easy to make pie in the sky assertions but a bit harder to quantify and explain those assertions with facts.

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  #504 (permalink)  
Old 27-12-2011, 12:49 AM
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Simple question ... Where's the stimuli for this ?

-Interest rate ? No already all time low.
-govt policy? No, govt is doing all it can to bring down prices with repeated cooling measures
-lack of supply? No, huge supply coming on stream both from existing developments and new land sites releases
-affordable property prices? No, Singapore property is way way overpriced by every fundamental measure, both in absolute terms and compared to historical ratios in 1990

It's easy to make pie in the sky assertions but a bit harder to quantify and explain those assertions with facts.
Biased analysis. What about:

- hot money. US on recovery, while europe and china will soon embark on QE => hot money will flow in again.

- immigration policy. if you read carefully our ministers' comments before, during, after elections and their current messages, the trend is toward "easing" of immigration. unsurprisingly it's always "talent is important".

- developers faking it. they will do more stunts to boost demand.

- wannabes. lots of young people overstretching themselves. they will rope in their parents and grandparents.

- affordability. just ask MBT. it's always affordable. average graduate couple now earns $6k or more. 50% DSR is $3k. borrowing for 40years at 1% will allow them to take a $1.2m loan. prices now are extremely affordable.

i bet my last dollar that prices will go up another 50%.
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  #505 (permalink)  
Old 27-12-2011, 12:56 AM
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Simple question ... Where's the stimuli for this ?
What then was the stimuli in 1990 that caused property price to triple?
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  #506 (permalink)  
Old 27-12-2011, 03:32 AM
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What then was the stimuli in 1990 that caused property price to triple?
- relaxation of cpf - money can be used for property purchase.
- good years, more good years.
- HK immigrants pre-1997. (most left after a few years post-1997 though.)
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  #507 (permalink)  
Old 27-12-2011, 12:38 PM
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Taking 14 years to reach the same psf, is not breaking even at all. Need to factor in the negative equity risk and high interest rates in the past. Yes, property can be a good investment, no question about that. If u can hold long enough through the market cycles, property is almost bao jiak. The question is, how long can u hold, why hold for 14 years just to break even, when if u buy at the trough, u just need to hold for far less than 14 years and make a decent profit?

Also, why buy property NOW, when the situation in 2012 is probably closer to the 1997 situation (peak) than the 2005 or 2009 situation (trough)?

If u are so rich as to not be bothered about a drop in property value, and have long holding power, then no harm can be done to u no matter what. But not everyone is that rich.

I won't bother arguing with the eternal property bulls anymore. Long property is right in the very long run, but timing is crucial. Price does not increase in a straight line, it goes up and down while generally increasing. In between, many things can happen, fortunes can be made and broken. Basically, don't get into trouble by buying property at the wrong time, that is all I am trying to say.
Agreed. And property investment involves higher risk than stock because the worst is not just losing all your money, but you can be caught in negative equity with huge debts due to leverage - downpayment 20% and borrowing 80%.
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  #508 (permalink)  
Old 27-12-2011, 12:44 PM
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Simple question ... Where's the stimuli for this ?

-Interest rate ? No already all time low.
-govt policy? No, govt is doing all it can to bring down prices with repeated cooling measures
-lack of supply? No, huge supply coming on stream both from existing developments and new land sites releases
-affordable property prices? No, Singapore property is way way overpriced by every fundamental measure, both in absolute terms and compared to historical ratios in 1990

It's easy to make pie in the sky assertions but a bit harder to quantify and explain those assertions with facts.
From another perspective, govt multiple intervention shows that the underlying market demand for Singapore property is very high - in fact it is a lot higher than the 1990s. So if the demand or property prices starts to fall beyond a certain point, the govt will have to intervene again since the govt wants stability, not a property price crash.
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  #509 (permalink)  
Old 27-12-2011, 01:16 PM
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From another perspective, govt multiple intervention shows that the underlying market demand for Singapore property is very high - in fact it is a lot higher than the 1990s. So if the demand or property prices starts to fall beyond a certain point, the govt will have to intervene again since the govt wants stability, not a property price crash.
I agree.

There was a quote from a billionaire investor on property investment timing for the Singapore market that I thought was pretty insightful.

He said he would never buy into a market when the govt is intervening with cooling measures because the govt has unlimited bullets, hence the market will definitely come down - just a question of time. He would rather wait until the market falls, and the govt cine in with supportive or liberalisation measures before jumping in because its much easier to reach your destination when u have the wind behind you.


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  #510 (permalink)  
Old 27-12-2011, 04:28 PM
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I agree.

There was a quote from a billionaire investor on property investment timing for the Singapore market that I thought was pretty insightful.

He said he would never buy into a market when the govt is intervening with cooling measures because the govt has unlimited bullets, hence the market will definitely come down - just a question of time. He would rather wait until the market falls, and the govt cine in with supportive or liberalisation measures before jumping in because its much easier to reach your destination when u have the wind behind you.
May I know who that billionaire investor is? Could you provide a link to the source please?
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