Without PR, the HDB market will collapse
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I can't help thinking in this that the HDB market will collapse without PR.
Why? Now Singaporeans buy cheap HDB from gov, after 5 years sell off to PR, fetch good price.
PR can't buy new HDB, so no choice to buy in resale market. If one day there is no PR in the resale market. You can imagine the whole HDB will collapse because there is no buyers!
Those Singaporeans who still think that PRs are not important. You're wrong. Wake up. Your wealth, big part of it your HDB, is supported by PR. You are dependent on PR.
I hope more PR to come into Singapore, then the housing market will be tight, and then my HDB will become very expensive, and then I will be very rich.
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1) If you sell off your HDB to PR. Where are you going to live? Rent from the PR?
2) The price of HDB is related to the supply. If HDB doesn't over supply the market, the price of HDB will also increase.
3) The value of your property is also related to the general wage level of the population. Compare a country B where the wage level is SG$1,000 a month and a country C where the wage level is SG$10,000 a month. Which country do you think will have a higher price for real estate?
4) PRs were imported to Singapore for the general purpose of decreasing the wage level of Singaporeans, as wages are generally sticky downwards, not many employees would want to reduce their wage rates. So the government imported lots of cheap labours to make the wages of ordinary Singaporeans fall.
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i was just thinking about this.
there were many people who bought expensive HDB flats just a few months ago, especially young couples. Assume a young couple bought a $500k HDB flat and took a 30 yr loan, it would mean that their average monthly instalment would be about $2k. (i have assumed they put little or no downpayment).
Now the problem is, to be able to pay a $2k instalment from CPF, it would mean that they have to earn about $6k between them to be able to afford the instalment. That works out to be about $3k per person.
Now with all the job cuts, what happens if one person gets retrenched? Would they still be able to afford a $2k monthly instalment? It will probably mean that instead of forking out the instalment thru CPF, they might have to use cash instead.
Not a good sign...
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Can the young couple actually afford to sign up for a housing loan, when during the last economic downturn in 2003-2004 - this Government and the NTUC had pushed retrenched Singaporeans to be employed again under new SHORT TERM 3-YEAR contract ?
With Singaporeans being employed on Short Term 3-Year Contract that is to be re-negotiated or renewable every 3 Years, leaving the Employers the option to hire and fire according to the Economic Cycle of bust and boom - can anyone commit themselves to a long term housing loan ?
The 3-Year Short Term Employment Contract will result in Singaporeans losing their jobs without any retrenchment benefits - as they were employed on short term, and they are not "technically retrenched".
Singaporeans have yet to wake-up and realise the full blown effect of such Short Term Employment Contract that was only implemented from the last economic downturn.
Since it was implemented four years ago, it will be interesting to see the number of homes being repossessed, when home loans can no longer be serviced in the current recession - {the term is supposedly worst then the economic downturn in 2003}.
This Singapore Government has created a Singapore version of the "US home mortgage sub-prime problem".
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There's something i don't understand though.
Our government has recently stopped the sale of land in the next few quarters to developers; essentially they are trying to quell the supply side of the housing market, while at the same time trying to prop up demand by importing more FTs to boost rental prices.Also, given that our country's (housing) property prices are dictated by the prices of HDB flats, would our property prices suffer a massive devaluation?
This artificial prop up can be seen by the perenial over-demand vs limited supply. i.e. the recent jurong west half yearly ballot was 21 times oversubscribed. (i was looking for the link at the HDB website but couldnt find it).
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The original purpose of HDB has been overtaken by greed.
When greed becomes the basis for balance.. the people suffers.
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Originally posted by picmonster:
I can't help thinking in this that the HDB market will collapse without PR.
Why? Now Singaporeans buy cheap HDB from gov, after 5 years sell off to PR, fetch good price.
PR can't buy new HDB, so no choice to buy in resale market. If one day there is no PR in the resale market. You can imagine the whole HDB will collapse because there is no buyers!
Those Singaporeans who still think that PRs are not important. You're wrong. Wake up. Your wealth, big part of it your HDB, is supported by PR. You are dependent on PR.
I hope more PR to come into Singapore, then the housing market will be tight, and then my HDB will become very expensive, and then I will be very rich.
Dude! seriously....you really need to do lots of soul searching. And your Maths too.
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yah..if you want to calculate like that..y not think about this: -
with more PRs purchasing resales flats..pushing up the prices of resale flats = misery for S'poreans
Why?
Simply cuz..they have to fork out more just to vie for resale flats
FYI, there are ppl out there who prefer resales flats cuz of the convenient centralized location + established neighbourhood =)
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How anyone can pay half a million for a HDB flat is beyond me.
You do the math and look at how much interest you need to pay for that 30 year loan.
Aiyoyo.
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Originally posted by charlize:
How anyone can pay half a million for a HDB flat is beyond me.
You do the math and look at how much interest you need to pay for that 30 year loan.
Aiyoyo.
no choice. u dun live hdb den live where?
cannot be live with parents forever ma ....
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Originally posted by picmonster:
I can't help thinking in this that the HDB market will collapse without PR.
Why? Now Singaporeans buy cheap HDB from gov, after 5 years sell off to PR, fetch good price.
PR can't buy new HDB, so no choice to buy in resale market. If one day there is no PR in the resale market. You can imagine the whole HDB will collapse because there is no buyers!
Those Singaporeans who still think that PRs are not important. You're wrong. Wake up. Your wealth, big part of it your HDB, is supported by PR. You are dependent on PR.
I hope more PR to come into Singapore, then the housing market will be tight, and then my HDB will become very expensive, and then I will be very rich.
logic-fail
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Originally posted by maurizio13:
1) If you sell off your HDB to PR. Where are you going to live? Rent from the PR?
2) The price of HDB is related to the supply. If HDB doesn't over supply the market, the price of HDB will also increase.
3) The value of your property is also related to the general wage level of the population. Compare a country B where the wage level is SG$1,000 a month and a country C where the wage level is SG$10,000 a month. Which country do you think will have a higher price for real estate?
4) PRs were imported to Singapore for the general purpose of decreasing the wage level of Singaporeans, as wages are generally sticky downwards, not many employees would want to reduce their wage rates. So the government imported lots of cheap labours to make the wages of ordinary Singaporeans fall.
See:
Columns
Property Prices Rise at our expense - By Andrew PK Yap
By Andrew PK Yap
Author of Insights Into Casino and Stock Market
When property prices go up, it benefits the few at the expense of the majority.
The unchecked and unnatural rise in the price of property in Singapore over the past years and in the coming years will harm you, the average Singaporean for the benefit of the rich.
Construction costs will rise due to inflation. If property prices are allowed to rise over and above this increase; would the rising be considered as an unnatural rise? Should the finger be pointed at the biggest land owner and property developer with a virtual monopoly of the real estate market?
A fast rate of increase in property prices is the one item that does the most damage to the majority of Singaporeans. Property price increases benefit mainly the following groups. Those that want to migrate. Those that want to cash in on the price increases by selling their extra properties.
Those that invest (gamble) in property prices hoping to hit the jackpot. Foreigners.
The rest suffers. Everybody else suffers. The increase in property prices will cause a rise in rental rates and mortgage rates and mortgage amounts; among numerous other things.
With the current rise in property prices unabated since 2004; it has become an urgent question to reflect upon. It happens to be the one factor that is directly under the Singapore Government's control. They are the single biggest land owner and the single biggest property owner and developer. They relentlessly acquired land using legislation. They asked those who sacrificed their lands to consider the bigger good. Had their sacrifice now ended up in a system that exploits the poor and poorer among us?
The government in power can and must target the property price increases to below the common inflation rate; taking preemptive measures to ensure that price does not rise above that.
This will directly benefit the majority of Singaporeans at the expense of the minority who treats property prices as a casino game rather then a necessity. Singaporeans as a whole will benefit with having more money in their pockets instead of it being tied up in properties and paying for mortgage interests.
What is to be done about the already sharp rise? A sudden crash will have vast negative impact. A slow burn will be the best course of action. A continual risewould certainly raise questions as to the integrity of the government in power.
Housing must once and for all be a consumable item and never for investment. Capital will be directed towards jobs creating industries instead of gambled in properties hoping to hit the jackpot.
When it comes to properties, the principle of more than enough must apply at all times. To ensure that there is more than enough, there must be a glut at all times.
There must be a glut in the various types of housing
There must be a glut in the various types of commercial properties.
There must be a glut in rental properties.
There must be a glut in properties that cater to the micro entrepreneurs.
There must be a glut in properties that cater to the big entrepreneurs.
There must be a glut in properties for rental to hawkers.
You get the picture.
Before you blast me with negative comments, please consider the following:
Property price increases are meaningless for the property owner who needs a roof over his head.
Property price increases creates and adds unecessary burdens for the next generation, our children.
Property price increases are a method to transfer money from the poor (non property owners) to the rich (extra properties owners.)
The rich can take good care of themselves.
Andrew Yap can be contacted at [email protected]Vote: [+/-] - Score: [ 77 ] - posted at 02:27:06 on 05/09/06 by Andrew PK Yap - Category: Columns
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