Rents increased 30% in the last week??

Discuss about where to live, renting a property, tenancy issues, property trend and property investment in Singapore.
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huggybear
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Post by huggybear » Fri, 23 Mar 2007 10:27 am

thelostfish wrote:tell that to the millions of people from all walks of lives, to the small corporation to the big corporations over the generations whom have gone bust.
huh? :-k there is a difference between leveraging yourself 10:1 and then the investment going bust to getting fired from your job and unable to find a new one.
thelostfish wrote:also for my original post about the gal who was in a sorry state of affairs. Well she could not liquidate either since she doesnt have the 100k odd to pay off the outstanding loan.

also you cant say those people were totally stupid, in fact she was a smarter lot who bought AFTER the crash in 1997/98, thinking its the bottom.
thelostfish wrote:sometimes, the risks were unforeseen, like SARS or Sept 11? Whoever thought USA would be attacked so damn easily? or that the recession would last 5-6 years? or that cows could go mad and birds could infect us. or that USA will go to war so often...oh wait, maybe that's was for-seeable :lol:
this is a really bad argument...really bad. when you cross the street, do you think to yourself "I might get hit by a car." No, you worry about things you can control....
thelostfish wrote:As for comparing to property prices plummetting during a recession. Well what did you expect? during the recessions almost anything anywhere will lose some value, no? shares/stocks, interest rates etc. if you compared to the property values since 1995/6 here in singapore to their lowest point in 1998/99, about 40-60% lost in value. but at least the property is still there.

some hot shares back then (i shalln't name them) have lost more than 1000% :???: :shock: and even gone bust. sure you may say not all shares were like that, and i would say not all property were like that either. I know of a lot which have already surpassed their highs attained in 1995/6. on the other hand, I have seen people who have lost 100s of thousands to millions overnight on shares. and they never recovered.
the recession argument was used to jeppo's response on why real estate is not a short term investment. how do share prices fall by more then 100%? I'm confused. :???: there is a concept called risk:reward. The higher the risk the higher the reward. There is no low risk high reward investment. none whatsoever. If people are investing 100k and making 1,000,000 in a few weeks or months, that is a high reward and the risk is that you may lose everything which many people did. and anyways, the share prices that lost "1,000%" were also the same ones that gained about 2,000% in about 1 month (i.e. JDSU, ICGE, etc). so again, risk reward. if something rises in spectacular fashion, then it has a good chance of also imploding in spectacular fashion.
thelostfish wrote:but all this is tiresome to debate, since really, its different for everyone. some like to invest in property, something tangible, some like to invest in shares/currencies. but any investor would tell you that shares are much riskier. and hence also higher returns

back to the topic about rentals, my posts were meant to shed some light as to why it seems like the rental rates gone mad. which i feel, it may not be totally true.

I was trying to explain that if the rental you were paying is about 3-4%, i think you dont have TOO much to complain about. cos anything lower, frankly is cheap, and given today's market its probably a rather unpopular flat/location. (refer to my earlier post about bank giving 2.5% on your CASH) :?
rental rates have gone "mad" because sales of property have gone mad. as sale prices go up, rental prices have to go up as well. condos are selling out before they even print marketing materials. also The gov't has closed more HDBs so people have to relocate. pretty simple really. why are banks offering 2.5% interest? because the central bank is flooding the market with liquidity. call your local politician and ask them to stop doing it.

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Post by Jeppo » Fri, 23 Mar 2007 10:35 am

Since the reading comprehension on this list seems to be rather low, I'm typing this slowly :D

I was not talking about buying and selling in the short term to make a gain, I was refering to using the rent to offset the interest payments, thus negating the need of the landlord to pay out of his own pocket. Reread my post and show me where I said ANYTHING about selling in the short term, or about financing with nothing down.

And HB if I'm young then you must be about 80 and since we're in Singapore and we're supposed to show respect to the elderly, I'll be refering to you as Grandpa HB from now on :P

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Post by huggybear » Fri, 23 Mar 2007 1:34 pm

damn i gotta get my cataract surgery....
sorry.

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Post by thelostfish » Fri, 23 Mar 2007 1:56 pm

well, like it or not, its reality. :D landlords will always look for rental returns on top of capital gains. whether they acheive it a not is subject to a whole lot of debate which clearly this thread isnt about. And looking at the market now, 4% is quite the norm.

if you dont like paying rent, you could always buy a flat yourself. :P

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Post by thelostfish » Fri, 23 Mar 2007 2:23 pm

huggybear wrote:
thelostfish wrote:sometimes, the risks were unforeseen, like SARS or Sept 11? Whoever thought USA would be attacked so damn easily? or that the recession would last 5-6 years? or that cows could go mad and birds could infect us. or that USA will go to war so often...oh wait, maybe that's was for-seeable :lol:
this is a really bad argument...really bad. when you cross the street, do you think to yourself "I might get hit by a car." No, you worry about things you can control....
hmm. I cant seem to figure it out you are trying to say. hell yea when i cross the road, i do think about the fact that people get run over by cars when crossing the roads, so i jolly well look out for traffic......

but anyway like u mentioned in the second line we make decisions based on things we can foresee. Those we can't control or foresee...well, you cant live your life in constant fear.....

What I am trying to say was, all those events like 911 or SARS was really something everyone did not expect to happen, it was quite a shock to the market. property market was bottomed out, she bought the flat, sounds fine till those things i mentioned happened.

anyway its my bad about 1000%, i think i was too tired last night, haha i meant losing 90% of the price or rather becoming 1/10 of their price. some shares are even worthless now.

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Post by huggybear » Fri, 23 Mar 2007 2:30 pm

thelostfish wrote:well, like it or not, its reality. :D landlords will always look for rental returns on top of capital gains. whether they acheive it a not is subject to a whole lot of debate which clearly this thread isnt about. And looking at the market now, 4% is quite the norm.

if you dont like paying rent, you could always buy a flat yourself. :P

i'm already long real estate assets. i wouldn't mind buying some landed property on a beach...but the rules prevent me. Any local want to marry me? :P

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Post by thelostfish » Fri, 23 Mar 2007 2:30 pm

huggybear wrote: if instead of holding on to your apartment for the next 7 years (in 2000) u liquidated and invested in the singapore stock index (straits times) u would have made 65% return. so even tho now you are finally in the black, the opportunity cost of sitting on the property means you're really down at least 65% ....
well, u seem to miss the point that in soo many cases it wasnt sooo simple just to sell the property and invest elsewhere, you keep misreading my posts, so i am beginning to wonder why am i bothering to reply. you owe the bank 600k, you sell at 500k. you are still 100K short my friend. you really think the bank will let you off?

and those suggestions you make seems well and dandy now. but frankly investing in foreign currency deposits and foreign stock and property are generally riskier, and i am NOT suprised you get more returns. hell you might as well as me to dump all my worth, convert them all to china stocks and whoopee i am a insanallionaire.

not everyone has that kind of foresight you seem to have. or was that your hindsight speaking?
Last edited by thelostfish on Fri, 23 Mar 2007 2:54 pm, edited 1 time in total.

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Post by thelostfish » Fri, 23 Mar 2007 2:38 pm

humpbackwhale wrote:Hi lostfish,

Just saw from the newspaper that today a orchard condo hit a new record high of $4000 psf, since you are in this property scene so long, may i know what is the difference in property price between prime area (orchard, 9, 10,11) and places like east coast, bedok, tampines in 1997 during the peak?

It seems now there is a big diff in price between city area and outside city, i would like to know how much will the price increase for outside city eventually so that i know what rent these areas (east coast, bedok, tampines) is going to be like. TIA!
the 4kpsf is quite a record and can only be consider possible if you compare luxury units here in singapore and the likes of tokyo, hong kong etc. there is no other developments here in singapore that hit that kind of price. is it worth it? hell no, but to the megainsanely rich, they might not care

about the price difference, its really hard to be so general, but during the last high in 1996, i would say you can expect 20% price difference on the average between prime areas and the eastern side. these days, maybe more around 25%, since the prime areas are made to the "luxury" level....or really perhaps the rest of singapore havent quite caught up the pace from the central areas.

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Post by huggybear » Fri, 23 Mar 2007 3:56 pm

thelostfish wrote:
huggybear wrote: if instead of holding on to your apartment for the next 7 years (in 2000) u liquidated and invested in the singapore stock index (straits times) u would have made 65% return. so even tho now you are finally in the black, the opportunity cost of sitting on the property means you're really down at least 65% ....
well, u seem to miss the point that in soo many cases it wasnt sooo simple just to sell the property and invest elsewhere, you keep misreading my posts, so i am beginning to wonder why am i bothering to reply. you owe the bank 600k, you sell at 500k. you are still 100K short my friend. you really think the bank will let you off?

and those suggestions you make seems well and dandy now. but frankly investing in foreign currency deposits and foreign stock and property are generally riskier, and i am NOT suprised you get more returns. hell you might as well as me to dump all my worth, convert them all to china stocks and whoopee i am a insanallionaire.

not everyone has that kind of foresight you seem to have. or was that your hindsight speaking?
man today is not my day. sorry about that. i hear you on the hindsight is 20/20.

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Post by humpbackwhale » Fri, 23 Mar 2007 11:55 pm

Hi lostfish,

thanks for the info, so for the safe side i think i will have to make more provision and assume that the rent on the east side will continue to rise to catch up to prime area.

i too believe that $4000psf is ridiculous, but it will sure make property price go up further, and thus rent too. I think those for are renewing their lease better do it fast and lock the rent for 2 yrs or more.

i personally think more and more people will come to Singapore and rent will only increase, to make it worst, the tearing down of all the en-bloc (perfectly good condo) building for the next few months will only make the situation worst as the supply can reduce drastically.

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Post by ScoobyDoes » Sat, 24 Mar 2007 10:01 am

My colleague is moving out of his apartment in Maplewoods because his landlord is attempting to raise his rent from S$2,800+Management to a whopping S$5,800+

Firstly it's an older condo already with a few brand new ones around it. Secondly i can get a fully Serviced Apartment for less than that. It's really crazy.

This kind of increase is just a rip-off but unfortunately not isolated. Another friend around the same area is in a very similar situation but in a different condo. Problem is that some people coming into town without a clue would think these prices are "normal" and make the landlord's day.

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Post by Grim Reaper » Sat, 24 Mar 2007 11:45 am

humpbackwhale wrote:i personally think more and more people will come to Singapore and rent will only increase, to make it worst, the tearing down of all the en-bloc (perfectly good condo) building for the next few months will only make the situation worst as the supply can reduce drastically.
What makes you think the supply here is so little?

Take a cab or your own car and drive around for a weekend, do a bit of research and you will see there is an enormous amount of supply in all ranges in property.

Agents and landlords are trying to create an image of supply and demand, whereas the truth is far from that, it is purely speculation.
Time will come....

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Post by ScoobyDoes » Sat, 24 Mar 2007 5:33 pm

Grim Reaper wrote: Take a cab or your own car and drive around for a weekend, do a bit of research and you will see there is an enormous amount of supply in all ranges in property.

Agents and landlords are trying to create an image of supply and demand, whereas the truth is far from that, it is purely speculation.
Agreed, and i don't know then why landlords are being stupid raising the rents the way they are. As my friend is finding out, he just moves to another.

I'm keeping my fingers crossed as well though, as i start looking on Monday too.

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Post by humpbackwhale » Sat, 24 Mar 2007 10:51 pm

Grim Reaper, ScoobyDoes - yes if you drive around, you can see there is alot of property coming up and property for rent, but what you cannot see is the demand side.

Ultimately the equation is balance by price, and if the price keep going up, i do not need to argue with you. Landlord can and will always ask for higher price, the problem is they are getting the higher price and this tell you something.

If you are paying rent my best advice to you is to quickly renegotiate and lock down the price, else many is already moving to smaller units or further away from the city. When you can turn a blind eye but ultimately yourself will suffer when your lease is up.

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Post by thelostfish » Mon, 26 Mar 2007 10:47 am

humpbackwhale wrote:Hi lostfish,

i too believe that $4000psf is ridiculous, but it will sure make property price go up further, and thus rent too. .
i was bringing this up the other day to my colleagues, and i feel perhaps its not as ridiculous as it seems.

I saw the other day on the papers, some mega-rich fellow earthling bought a abstract art painting for US$42million. :shock: which looks like something a 10year kid could paint. :lol:

So $17million for a ultra posh 4000sqft penthouse might seem like a better deal if you ask me :P

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