Singapore Property Going Down The Tubes?

Discuss about where to live, renting a property, tenancy issues, property trend and property investment in Singapore.
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jpatokal
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Post by jpatokal » Tue, 15 Apr 2008 7:27 pm

timo_in_singapore wrote:2) Don't expect the Landlord to be a panicked seller and thus agree to lower rent because of what is happening in the global markets. Culturally, it is unacceptable to be seen lose face, and while uneconomic many landlords will accept the condo will be empty for a number of months rather than agree to a lower than expected rent. If they bought the place from spec in 2005 at 500psf and it's now trading at 1500psf, it still has some way to go before it is out of the money.
Losing face has nothing to do with it -- nobody but the landlord and the tenant will know what the agreed rental price is. Greed and misguided judgement, on the other hand, has plenty to do with it...

Anyway, this is not unique to Singapore, property rental and sale prices are sticky everywhere in the world. But at some point, the need for income will lead landlords to start accepting lower offers, and that's when prices will start to visibly come down.
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cannuck35
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Post by cannuck35 » Thu, 17 Apr 2008 10:29 pm

Culturally, it is unacceptable to be seen lose face,
I understand the culture after living in Hong Kong for 5 years and Singapore for 10 years.
"Face" is important for oneself but yet it appears to be culturally acceptable to berate and scream at your agent in the public parking lot when she hasn't been able to rent out the flat that was tenanted for 4 years at $3,800 per month and has been vacant for 7 months since the old tenants refused to pay $5,500? (I witnessed that on Sunday...a very unpleasant loss of face for the agent.)

"Face" goes right out the window when personal $$ are involved and everyone who has been here more than a minute knows that.
Most people I hear forecasting a imminent collapse of the SG property market are usually in the firing line for an upcoming rent hike
Ah yes...the mantra of an optimistic landlord.
This website alone lists 7,000+ units vacant now and it rises every month.
Excellent time to boot your tenants out and hope that your the 1 in 7,000 that actually gets the 30% increase without any loss of monthly cash flow... :roll:

Just doing the math...
Any personal financial adviser will say that spending more than 33% of your after tax income on rent is insane.
Therefore a $5,000 a month rental property (4,000 of these available on this website alone) requires a personal/combined income of S$20,000 per month in pre-tax income.

Visit any headhunter in town. There are probably about twenty $20,000 a month jobs available in town right now... :)

The EDB boasted of 8,000 new jobs created and the average wage will be under $6,000 a month. Unfortunately, these people cannot afford to live here while they work here. :D

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Post by Forks » Sun, 20 Apr 2008 3:27 pm

Given that rents have jumped in Singapore but wages have not I wonder how long can it go on and what kind of effects will start to be seen. Also Global economic effects may start to have some push here also. Is Singapore heading for the iceberg like the titanic? Maybe, i dont know but I want to know there is a lifeboat if it does hit.

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