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Rupiah/Rupee at risk, SG/HK risk property bubble

Goldbug

By Goldbug,
in Property Buzz

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Duckduck

Duckduck

Turbocharged

aiyo... where got problem.. COE go up again..

SC and SG PR ... $$ fills the bank :P

 

Good to hear so many still willing to put $ here despite weakening SGD. Via STI can already see capital outflow...

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Fatcat188

Fatcat188

Neutral Newbie

If we are not at risk,then gaverment will not put curb on property,cars and who knows what come next.This I feel is to protect the banks so there will be less bad debts .in the event cannot pay,force sale still got some cash and not negative equity as like before.They learn their lesson so dun believe financial prudent is for us!jus my 2cts .....

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Fatcat188

Fatcat188

Neutral Newbie

aiyo... where got problem.. COE go up again..

SC and SG PR ... $$ fills the bank :P

Whose smart idea to curb?now car prices new/old are even higher?knna simple supply and demand also dun know and all want fat salary!

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Yewheng

Yewheng

Twincharged
(edited)

If we are not at risk,then gaverment will not put curb on property,cars and who knows what come next.This I feel is to protect the banks so there will be less bad debts .in the event cannot pay,force sale still got some cash and not negative equity as like before.They learn their lesson so dun believe financial prudent is for us!jus my 2cts .....

 

Sort of help to protect Singapore Financial system and also people like us. I mean it indirectly does affect people like us who is looking to buy property and cars.

 

But it is something weird that government need to come up with so many measures just to stop banks from being too loose in $ lending. So what does this means??

 

It simply means banks don't care whether people can afford to make repayment or not, all they want is to make $ the fastest and grow the fastest, the rest talk later.

 

So I think the whole financial system still had not learn the lesson on year 2008 crisis, banks and other financial institutions are too busy trying to earn as much profit as possible and neglect on fundamentals

 

So in a way government step in is good, but like I said, government always 1 step too slow to the market.

Edited by Yewheng
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Yewheng

Yewheng

Twincharged
(edited)

One way is to know whether SG government is 1 step behind market is just by looking at Straits Times forum page, when people write about bubble forming, banks too loose in lending and many other loophone that government had not step in yet. That is a ringing bell that indirectly saying well, market forces changes very fast and government just cannot keep up with the pace due to need to go through so many layers for approval before things can be implemented.

Edited by Yewheng
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Wt_know

Wt_know

Supersonic
(edited)

3 Reasons Why Developers Can Sell At High Prices

 

point no 1 & 2 is the MOST LETHAL ...

 

1. The advantages of market domination

The property developer industry is an oligopoly. It is dominated by a few big players which are often large conglomerates.

The entry barrier for new players in this industry is exceptionally high. With limited supply and high cost of land, it is not easy for small developers to raise sufficient funds or obtain financing from the bank. They also cannot compete with the big guys in terms of branding and their track record in past projects.

Bigger players have stronger financial muscle to build their own land bank. They can drive construction of projects in time to capture a booming market. They enjoy the benefits of economies of scale or cost leadership from a large number of ongoing projects. They have a handsome budget for marketing and for leverage to hire a good marketing agent. They have enough cash reserves to hedge against poor sales during bad times.

It is therefore not surprising to see a high percentage of private housing projects all supplied by the top few developers. The advantages of market domination allow them to set their list prices at the highest possible level and to reap a huge profit.

 

2. Collaboration among big players

The big players have good connections amongst themselves to make the most of a mutually beneficial partnership. They can collaborate with each other by forming joint ventures to bid for land parcels, to secure borrowings from banks, or to diversify their investment.

Among the top property developers, they can seek consensus and alignment on many decisions, for instance:

• When to launch or re-launch in a quiet or recovering market;

• Which type of projects to launch in different locations; and

• What projects to hold back to avoid unnecessary competitions for similar projects.

When they are setting prices for a new launch, they don’t have to make reference to the average transacted prices of existing developments in the same district. They can benchmark against each other’s list prices in other districts in order to set their prices at a new high in a hot market.

Of course, no developer can move new properties off the shelves without the support of local banks to provide buyers the necessary financing. It is not uncommon to see developers tying up with a few banks to offer housing mortgage packages to buyers at the sales galleries.

In order to secure business from home buyers, banks work with their valuers to ensure that the valuation of the uncompleted property matches with the selling price, so that they can disburse the exact amount of housing loan required by the buyers.

 

3. Willing sellers, willing buyers

In the past few years, property developers have paid a high price for land parcels sold by the government or from en bloc sales. Likewise, the tight supply and spiraling costs of construction manpower and building materials have taken a toll on the bottom line of developers.

It is arguable that developers have no choice but to markup considerably to ensure their profitability, although how big a safety margin is reasonable is entirely up to their discretion. After all, if they don’t make hay while the sun shines, who can tell what will happen when market direction changes?

In the end, the matter boils down to market response and customer acceptance. Developers can’t sell new flats at future prices if buyers are unwillingly to pay a premium price.

It doesn’t matter whether the selling price is twenty or fifty percent higher than the most recent transacted price of a resale flat in the same area, so long as everyone believes that the market price will be even higher by the time the new flats are ready for occupation.

Believing in the future – that is the magic pill of getting buyers to pay future prices in a booming property market!

Edited by Wt_know
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Staff69

Staff69

Hypersonic
(edited)

So the guys that say, all will die by this week with such accuracy and conviction, would ...... :ph34r:[:p]

 

 

 

 

 

 

 

 

Die。。。。。one macdonald meal set would cost more now [bigcry]

Edited by Staff69
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ShepherdPie

ShepherdPie

5th Gear
(edited)

No US tapering until 2015.

 

Huat Ah.. all property owner *happy*

 

Interest rate stay low ( applicable to those that took fixed spread only) .... singapore GDP continue to grow and employment is tight...

 

Another 2 good years !

Edited by ShepherdPie
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Wt_know

Wt_know

Supersonic
(edited)

music continues until 2015

 

COE > short term $100k+, medium term $120k+, long term $150k+

 

Condo 99LH suburb > short term $1200psf, medium term $1500psf, long term $1800psf

 

DOW testing 16,000 liao .... HUAT AH !!!

Edited by Wt_know
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Yewheng

Yewheng

Twincharged
(edited)

No US tapering until 2015.

 

Huat Ah.. all property owner *happy*

 

Interest rate stay low ( applicable to those that took fixed spread only) .... singapore GDP continue to grow and employment is tight...

 

Another 2 good years !

 

It depends..

 

http://www.munknee.com/foreigners-beware-u...s-are-alarming/

 

I mean there are bonds that are going to mature, so what's next?? Will they reinvest in US treasury?? If no, what happen?? How will USA going to pay huge bills when they themselves already at the edge. Print $85 billion per month is not enough to pay off trillions dollar of bond mature. What about other expenses ?? So let's wait and see will China and other big players to continue print $ to buy up US treasury, if yes, then it would be a good 2 years, if not.. that spells the trouble.. or alarm..

 

http://www.treasury.gov/resource-center/da...aspx?data=yield

 

And what is worst is the maturity rate is at pathetic 0.13% for 1 year maturity. I mean it would be better off putting $ elsewhere but US treasury.

Edited by Yewheng
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Wt_know

Wt_know

Supersonic
(edited)

yewheng,

 

in theory, i agree with you

however, usa is the classic example of TOO BIG TO FAIL

if USA collapse the whole world & entire population will perish

 

china should do something. they are so sunk into the usa sinking hole

from ankle deep to knee deep now ...

 

it's unimaginable ... i think worst than 2012 fiction film ... if usa one day shout f**k it ... i'm going to reset my debt clock to ZERO (100% haircut)

Edited by Wt_know
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Yewheng

Yewheng

Twincharged

yewheng,

 

in theory, i agree with you

however, usa is the classic example of TOO BIG TO FAIL

if USA collapse the whole world & entire population will perish

 

china should do something. they are so sunk into the usa sinking hole

from ankle deep to knee deep now ...

 

it's unimaginable ... i think worst than 2012 fiction film ... if usa one day shout f**k it ... i'm going to reset my debt clock to ZERO (100% haircut)

 

Ya, so that is the problem. So USA still so Yaya papaya?? They should be at the mercy of China, Japan and other big players that help to delay the big crash.

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