Will COE be higher or lower by 2015 year end?

[Sunset73]

Let's start predicting Feb 2015 Round 2 bidding:

 

Cat A: 64,000

Cat B: 72,000

Cat C: 50,000

Cat E: 70,000

At least dropped $3K for Cat A n $6k for Cat B... so by year end should be $50k for A and $55k for B?

 

Not quite possible.. COE will go up instead

[Sdexxxxd]

The fact is that there are 600,000 cars on the road, and the government already say they are not going to increase this number.

Divide by 10 years COE life, if they decide to claw back and spread out the quota, it would be 60,000 COE per year, or 5,000 COE per month, or roughly 1,300 CatA + 1,000 CatB + 200 CatE = 2,500 per bid session

 

If you look at this quarter's quota, we are close to 2,000 per bid session already. There are limited upside for the quota, probably couple more quarters (or before the elections is held).

 

The issue is that for next 2 years, there are 100,000 cars who are going to deregister. How many of them would renew is an unknown, but for sure, they will be competing against the 60,000 COE available.

 

So, in conclusion, by end 2015, COE might probably drop a little from current level. But 2016 & 2017 should see it coming back up again.

 

Of course, there is another big external factor - provided no worldwide financial crisis.

[Powxus]

The fact is that there are 600,000 cars on the road, and the government already say they are not going to increase this number.

Divide by 10 years COE life, if they decide to claw back and spread out the quota, it would be 60,000 COE per year, or 5,000 COE per month, or roughly 1,300 CatA + 1,000 CatB + 200 CatE = 2,500 per bid session

 

If you look at this quarter's quota, we are close to 2,000 per bid session already. There are limited upside for the quota, probably couple more quarters (or before the elections is held).

 

The issue is that for next 2 years, there are 100,000 cars who are going to deregister. How many of them would renew is an unknown, but for sure, they will be competing against the 60,000 COE available.

 

So, in conclusion, by end 2015, COE might probably drop a little from current level. But 2016 & 2017 should see it coming back up again.

 

Of course, there is another big external factor - provided no worldwide financial crisis.

 

Safest bet is to buy before election. Once election is over, there is no worry to implement tough policy.

[Jamesc]

To some people, drop $10 is also drop.

 

 

 

Yes and they jump up and down screaming

 

I was right, I was right,

 

I am so smart, I am so smart.

 

Opps sorry this one not property thread.

 

[yo2020]

Just looking at onemotoring records. More than 300 unsuccessful bids in CAT A. These bids will carry forward to Wed, Although there is an increment in quota of around 289, will this be enough to bring coe prices down by 5%? Coupled with the new orders coming in, dun be surprised if coe shoots up.

ya correct, Cat A didnt drop by 5%. it merely dropped 4.6% only.

 

i was surprised that somehow Cat B & E dropped 7.8% n 6.3%, respectively.

[yo2020]

To some people, drop $10 is also drop.

To some people, up $10 is also up.

[flashbang]

With the 50% downpayment and increased quota, I expect COE to drop by end of 2015. However, don't think it will be a significant drop, probably still around the 50k level.

 

Dont need to hope for $1 COE, won't happen until the next major recession comes around...

[Angcheek]

 

That is sooooo true .... hahha voting day all go buy car hahaha

 

 

 

Safest bet is to buy before election. Once election is over, there is no worry to implement tough policy.

 

$1 coe is due to wrong policy by some weirdo . Not by market forces lel... even during recession

 

With the 50% downpayment and increased quota, I expect COE to drop by end of 2015. However, don't think it will be a significant drop, probably still around the 50k level.

 

Dont need to hope for $1 COE, won't happen until the next major recession comes around...

[flashbang]

Work harder earn more money, then can afford car lo... now even minimum sum going up...

[Forte3737]

Drop is good. But still not very affordable for the middle income. You can come in here and prove that you are spot on etc...and say I am XXXXX......but end of the day, a bread n butter car is likely to cost somewhere close to 100k., or even maybe more.

 

Can I afford it? Answer is no. Can you afford it? Answer is also NO.

 

 

ya correct, Cat A didnt drop by 5%. it merely dropped 4.6% only.

 

i was surprised that somehow Cat B & E dropped 7.8% n 6.3%, respectively.

 

[Coltplussport]

The fact is that there are 600,000 cars on the road, and the government already say they are not going to increase this number.

Divide by 10 years COE life, if they decide to claw back and spread out the quota, it would be 60,000 COE per year, or 5,000 COE per month, or roughly 1,300 CatA + 1,000 CatB + 200 CatE = 2,500 per bid session

 

If you look at this quarter's quota, we are close to 2,000 per bid session already. There are limited upside for the quota, probably couple more quarters (or before the elections is held).

 

The issue is that for next 2 years, there are 100,000 cars who are going to deregister. How many of them would renew is an unknown, but for sure, they will be competing against the 60,000 COE available.

 

So, in conclusion, by end 2015, COE might probably drop a little from current level. But 2016 & 2017 should see it coming back up again.

 

Of course, there is another big external factor - provided no worldwide financial crisis.

If there are 100000 de registered vehicles per year , then the new quota would not stay at 60000 per year. How to? For 2 years, you actually allows a decrease of car population of 80k, which is equivalent of around 14%?

 

Since govt already said zero growth, most likely they will release the COE recovered.

[Sdexxxxd]

If there are 100000 de registered vehicles per year , then the new quota would not stay at 60000 per year. How to? For 2 years, you actually allows a decrease of car population of 80k, which is equivalent of around 14%?

 

Since govt already said zero growth, most likely they will release the COE recovered.

 

That's the claw back theory.

 

100,000 deregistered, but they only release 60,000.

Keep 40,000 in the bank to be released during the low years.

 

During this period, the COE is expected to shoot up again, as X% of the 100,000 car owners will likely to be in the replacement market.

[Darryn]

 

End of the day, no matter whether COE is high or low, us consumers lose out the most. Let's say COE dips to 30k in general across the board for all categories, a brand new toyota altis cost you 80k as a rough estimate.

 

Will many people be able to afford a brand new car now? I will say no. Ultimately, how many of us is able to take out 40% of the car price as downpayment, which in this case is 32K? and afford the high monthly instalments on the 5-year loan?

 

Gone were the days of 0 downpayment and 10 year loan. All these has made the average joe harder to own a car.

The sad truth of life.

Just to point out ---

 

40% down and 5 years the payments will be roughly the same as 0% down and 10 years

 

* I just checked to confirm this, using my own car price and payments as a reference point - the two different loans are within $40 / Month of each other

With the 50% downpayment and increased quota, I expect COE to drop by end of 2015. However, don't think it will be a significant drop, probably still around the 50k level.

 

Dont need to hope for $1 COE, won't happen until the next major recession comes around...

Eh - I would call a $20-ish K drop fairly significant (from approx $70k to $50k)...

 

But obviously YMMV

Edited February 5, 2015 by Darryn

[Forte3737]

If 20K drop, many will rush in, pushing up the price again, I am sure the LTA does not want to see such fluctuations in price

Just to point out ---

 

40% down and 5 years the payments will be roughly the same as 0% down and 10 years

 

* I just checked to confirm this, using my own car price and payments as a reference point - the two different loans are within $40 / Month of each other

Eh - I would call a $20-ish K drop fairly significant (from approx $70k to $50k)...

 

But obviously YMMV

 

[Sunset73]

Just to point out ---

 

40% down and 5 years the payments will be roughly the same as 0% down and 10 years

 

* I just checked to confirm this, using my own car price and payments as a reference point - the two different loans are within $40 / Month of each other

Eh - I would call a $20-ish K drop fairly significant (from approx $70k to $50k)...

 

But obviously YMMV

 

Bro.. you are right that the monthly instalments are the same.. but the problem is the 0% downpayment. I believe many people can pay the monthly of 1000+ but unable to come out with 40-50% of the car price as downpayment

[Darryn]

The downpayment is different, thus, many dealers come up with overtrade deals to help cover the downpayment, and stretch the loan.

 

 

I don't know how the dealers are getting away with it -

whether it's because gahment walks around blindfolded or because they are stewpig.

 

Ford, for example, is advertising very loudly that they are offering "20% downpayment"

[Coltplussport]

 

That's the claw back theory.

 

100,000 deregistered, but they only release 60,000.

Keep 40,000 in the bank to be released during the low years.

 

During this period, the COE is expected to shoot up again, as X% of the 100,000 car owners will likely to be in the replacement market.

No way to keep 40k COE every year. It is impossible.

I don't know how the dealers are getting away with it -

whether it's because gahment walks around blindfolded or because they are stewpig.

 

Ford, for example, is advertising very loudly that they are offering "20% downpayment"

This one sure govt close one eye, or else those desperate for car might go and burn down parliament house.

[Powxus]

No way to keep 40k COE every year. It is impossible.

 

They are not keeping every year, only those years with 100k COE.

 

Anyway it's a good thing that COE supply remains more or less constant so at least car price remains stable, unlike the past few years where we have wild swing from $10k to $90k.