Right time to invest in SG property?

[Japprend]

Speaking with several local friends, there is a view that the property market has bottomed-out and there may be fresh pickings on the market. However, there are others that think that there is no capital upside in the medium term.

Do you think its the right time to invest in property now? What type of property - HDB, condo, Landed, GCB? What areas? What price range?

Any ideas from anyone enlightened?

[NBB]

Aha, interesting question!

I've been thinking that now is a pretty good time to invest, yes. For a while, in fact.

Have a look here - a relevant thread, quite recent.

P.S. I'm no guru, I go by the background noise around us.

NBB

[Japprend]

Interesting discussion but no one was willing to stick his neck out to make a decision. there will always be the factors like govt control, stock market returns. The general property market has seen a 0.1% uptick in prices, I've heard that certain classes of properties like Good Class Bungalows GCB have risen by 3%, but that's if you have a lot of spare change.

I'm just wondering if there are acute observations from people out there as to which classes of property are interesting. Clearly not overly packed condos in Upper Bt Timah which are in the zone of over-supply.

[PhantomX]

Generally Singapore is in a multi year property glut which has still some way to run. This has been exacerbated by the unconvincing jobless recovery that we are now experiencing and the prospects going forward are less encouraging than previous turnarounds
All this puts a lid on any prospectiveprice rise
although having said that the market may be more polarised now then it has ever been given the corresponding polarisation of the socio economic profile ie the rich getting richer and the poorer much more so
So both top end and bottom end will see movement whereas the sandwiched middle layer may stagnate given that their mid 30s to 40s profile and young families would make them more risk averse than before with the trend of ongoing job attrition likely to continue

PS sori for the condensed style here given that i m trying to pack max in min space

[jpatokal]

I agree with PhantomX. Optimists like our ever-cheery NBB will point out, quite correctly, that property prices are presently at multi-year lows. Realists like me :mrgeen: will retort that this is due to a housing glut, which won't be solved anytime soon. Singapore hasn't stopped building despite the fact that population growth is nearing negative territory, with HDB still churning out thousands and thousands of flats every year (7300 in 2003), this in addition to private construction. Quite frankly, I don't think it's very sensible to invest in a market where the major player is a government entity that doesn't have to worry about inconvenient things like "return on investment".

[NBB]

Did somebody call my name?



JP, you serve your purpose well. It's groundswell like you that are the perfect indicator on what to do. You see, if this doom and gloom has filtered down to your average dude (no offense) that's when you get in (if you're an investor looking to invest - which I'm not, BTW).

Similarly, when your barber, taxi-driver, neighbor etc. tells you he's just bought some stocks, each of them claiming to be making a tidy bundle, it's time to cash in your chips and go liquid, get TF out.

Again, I'm no investor, but I do understand rule #1:

[font=Verdana]Buy low, sell high.[/font]

Add to that the fact that we're all witnessing a bottoming out of the lows, I think an investor would be foolish to wait longer still.

For example, look at the frequency of posts on this very forum by people looking to settle in Singapore. Have you noticed the number of these shoot up? When will you bears twig there's an uptick happening here? When everyone and his mother has entered the fray I suppose.

Prices will not go further down, let's agree on this. I'm not saying you're going to reap mega-profits this year, but prices have only one way to go. [marq=up]Up.[/marq]

[jpatokal]

Prices will not go further down, let's agree on this. I'm not saying you're going to reap mega-profits this year, but prices have only one way to go. [marq=up]Up.[/marq]

Sure, some sectors in the property market are hot -- and priced accordingly. I am considerably less than convinced that the price of, say, a 3-bedroom apartment in an older condo in Jurong will go up, as there is little demand and I don't see that demand coming in.

[yoongf]

My opinion...

Prices have stabalised due to majority of weak holders having been flushed out thru mortgagee sales by the banks.

Demand must outstrip supply for prices to rise. I do not see such a situation for at least the next 3-5 yrs. In the Masterplan 2003, URA has significantly increased some plot ratios to 3.5, ensuring a large supply of apts if a developer decides to bid for the land.

High Land costs have been cited as the basis for Sg's uncompetitiveness. I would tink the govt's objectives are to prevent significant price increases in this area.

This is not to say that there are no good deals out there. Distressed sales usually see properties go for a discount. This discount may translate to a price increase later on. However, there are many other investment veh that can offer superior returns such as Stocks.. Capitalmall Trust, AREIT, etc.

[NBB]

Seems everyone is wrong.

Why the property market is still in the doldrums

NBB

[apple]

You're all confusing me!

To buy or not to buy that is the question.

We all know its to do with supply and demand, so for those of us who are not familiar with singapore (me) please tell us if the answer is to buy, then where? Which are the most stable locations, and any ideas how much? property prices in Singapore are not as cheap as I'd expected. Infact from what I can make out, the prices are extremely steep.

[Cyclops]

Hi all:

I am generally not very keen on the property market in Singapore actually unless you want to settle down here. Land prices are very high here already. My condo costs abt S$500k already. I am currently in land banking which I feel is much cheaper and safer. Do contact me if you are interested in finding out what is land banking.

Regards

Damien Yoo

[email protected]
-94874085-

[grey]

invest only if you can read the gov's mind!

[Property Consultant]

The property market is highly correlated to the growth / degrowth in GDP but it has an approximate 9 month lag effect. R-squared coefficient = 0.9 (out of a whole number of 1).

However, lagging statistics can only explain so much going forward.

Demand / Supply ultimately matters and up till now, demand is only starting to close the gap - but that gap remains large.

If you are buying to live, then OK, my expectation is that there will be gradual upward movement for the next 36 months but nothing like the other markets whether they be in London, New York, Jakarta, Sydney, Johannesburg etc.

Another factor to watch is interest rates.
Medium term sustainable interest rate in Singapore is assumed to be at 4% - right now, cost of funds are just slightly over 1%. As interest rates move up, and contrary to popular believe, property markets will move up as well.

Up and until it breaks the 4% arbitrary medium-term equilibrium, property markets will continue growing and then it moves into a state of over-valuation, which again, due to irrational consumer behaviour, may still exhibit itself in a state of bullishness until rationality sets in - and this stage may take 3-5 years. It is also at this state where everyone jumps in on speculative investments.

[Guest]

Hi all:

I am generally not very keen on the property market in Singapore actually unless you want to settle down here. Land prices are very high here already. My condo costs abt S$500k already. I am currently in land banking which I feel is much cheaper and safer. Do contact me if you are interested in finding out what is land banking.

Regards

Damien Yoo

[email protected]
-94874085-

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