Are property prices real?

[Rani's]

One citizen and one permanent resident will do, subject to all other conditions of course found here: http://www.hdb.gov.sg/fi10/fi10321p.nsf ... itizenship

This if for a purchase direct from HDB, involves a wait of several years for construction to complete.

Many thanks for the reply. I'd like to settle in Singapore relatively soon really, and would need a home before several years ahead, when an HDB becomes available. Once we are married, would we be able to purchase an existing HDB from a seller instead?

[JR8]

Do note that you can't buy an HDB if either of you own any other property. That rule temporarily tripped us up when we first found it out!

[therat]

Many thanks for the reply. I'd like to settle in Singapore relatively soon really, and would need a home before several years ahead, when an HDB becomes available. Once we are married, would we be able to purchase an existing HDB from a seller instead?

Yes,

You can buy HDB from seller. Which we call it resale HDB.
Presently resale HDB is more costly then purchase direct from HDB and you need to pay COV in cash.

And depend on location.

Some popular location - HDB is cost as much as 700k.

[macaroonie]

Could someone explain to a non-economist how prices can continue to sky rocket so such high levels (rental or sale prices) and the general population (who i guess, salaries are not equally sky rocketing), manage to make ends meet?

Also i assume this is a market economy, if rental prices are really way above the cost of a mortgage, how can landlord demand and get such prices? Not all foreigners here are earning a huge salary, but nearly all rentals (including HDB) are really ridiculous compared to even western countries!

Many thanks!

[sundaymorningstaple]

None western and a lot of westerners are not renting HDBs. Lower EPs & S pass holders are renting rooms.

Singapore families have the added benefit of 2 or 3 tier family structures under the same roof which means there can be possibly 2 or several more wage earners in the family all contributing to the "Household" income. Often, while the parents are under an income cap, it doesn't mean their household salary (which in the eyes of HDB is the husband & wife) isn't considerably higher if they have adult children still living at home (most don't get married until 32~35 so that's a lot of years of additional income contributions. The data is skewed because of that tendency and nobody seems to bring it up. (Probably because they don't want to be taxed on the "monthly gifts" from the children). This also goes a far distance to explain why there are so many Beemers & Mercs in the HDB parking lots.

[Rani's]

Presently resale HDB is more costly then purchase direct from HDB and you need to pay COV in cash.

Thanks. Can you explain the following then please, from the Housing and Development Board web site...

"COV is however not a requirement for HDB resale transactions. Resale transactions take place on a "willing buyer- willing seller" basis and the price is open to negotiation and mutually agreed between both parties."

I don't follow why cash over valuation is paid. If the valuation of the HDB being sold is 'x', why would anyone pay more?

[macaroonie]

Thanks SMS. What i am still confused about is that even condo rentals are just sky high! Do people really earn that much to pay over eg $5K in rental each month? Or are these mostly company rentals?

I remember reading somewhere on this forum that people would spend like 30% of their salaries on rental. Is this true out there? Or has it gone up now?

How much is a reasonable % of one's salary to be saving each month?

[therat]

Thanks. Can you explain the following then please, from the Housing and Development Board web site...

"COV is however not a requirement for HDB resale transactions. Resale transactions take place on a "willing buyer- willing seller" basis and the price is open to negotiation and mutually agreed between both parties."

I don't follow why cash over valuation is paid. If the valuation of the HDB being sold is 'x', why would anyone pay more?

supply and demand.

You can offer at valuation. However if there is another group of buyer want to over bid you by offer $X COV on top of the valuation.
Seller will take up which offer.

HDB has not build enough HDB unit for many many yrs and during this period, the population (foreigner come to work and PR) increase sharply.

That's why ex-Minister for National Development Mr Mah Bow Tan is one of the most dislike Minister in Singapore.
I had not come across any one like him.

He was know as the Money generator for the Government. Every time he move to a new department. There always something invented.

He is the one come out the idea of : - ERP ,COE and COV

[zzm9980]

Presently resale HDB is more costly then purchase direct from HDB and you need to pay COV in cash.

Thanks. Can you explain the following then please, from the Housing and Development Board web site...

"COV is however not a requirement for HDB resale transactions. Resale transactions take place on a "willing buyer- willing seller" basis and the price is open to negotiation and mutually agreed between both parties."

I don't follow why cash over valuation is paid. If the valuation of the HDB being sold is 'x', why would anyone pay more?

There is not enough supply to meet the demand. HDB assigns the valuation on your unit, but may not properly quantify subjective attributes such as interior redesign or your units location in the building.

I'll use my building as an example. Half of the building has an amazing view of the beach, the straits, and Batam on clear days. The other half of the building has a view of another block's laundry, and maybe if they're lucky, a sea view if you stick your head outside and twist your neck at a bad angle. If HDB says the valuation on the flats is $400k for this building, why would anyone want to buy the less desirable units? So those in the more desirable units charge $100k+ COV. The demand is there. (And this being Singapore, and Kiasu > *, those in the shitty units will try to charge $70-90k COV)

[x9200]

Thanks SMS. What i am still confused about is that even condo rentals are just sky high! Do people really earn that much to pay over eg $5K in rental each month? Or are these mostly company rentals?

I guess many if not the majority of the high-end in price places are paid by the companies (housing benefits) but there are also lots of people having this sort of salaries and frankly 5-6k is rather average rental island-wide or even low for anything more central. There are also people on double income but for the condo occupants it is probably a minority.

I remember reading somewhere on this forum that people would spend like 30% of their salaries on rental. Is this true out there? Or has it gone up now?

How much is a reasonable % of one's salary to be saving each month?

Hart do say, especially in the place like Singapore I don't think it makes too much sense to assign any number here. It can be 70% and still reasonable if you can afford it and carry on with all the other things including retirement plans, savings and insurance.

[macaroonie]

X9200 do you mean 70% of one's salary on rental ? Or do you mean saving 70% of one's salary?

[zzm9980]

X9200 do you mean 70% of one's salary on rental ? Or do you mean saving 70% of one's salary?

He meant the former, but you missed the point. The percentage as a general rule does not work, because two people will rarely have identical financial situations.

[the lynx]

X9200 do you mean 70% of one's salary on rental ? Or do you mean saving 70% of one's salary?

He meant the former, but you missed the point. The percentage as a general rule does not work, because two people will rarely have identical financial situations.

For a foreigner working as sales executive on SGD2000 income per month and renting a SGD500 HDB room in Bukit Batok, it is already 25%!

[zzm9980]

X9200 do you mean 70% of one's salary on rental ? Or do you mean saving 70% of one's salary?

He meant the former, but you missed the point. The percentage as a general rule does not work, because two people will rarely have identical financial situations.

For a foreigner working as sales executive on SGD2000 income per month and renting a SGD500 HDB room in Bukit Batok, it is already 25%!

Or conversely, the expat on S$10k/month salary might not mind paying S$7k/month rent if every other expense is covered in his package.

[macaroonie]

I hear that rentals are on the way down - has anyone else heard this or do we need a prophet to estimate the direction