Should I buy my HDB flat now?

[bongster31]

fling san,
my short comment, too tire just back from hse hunting....

Hdb resale and private prices are pulling far apart..i.e. HDB cov is dropping and Private properties prices are moving up fast, after the national day cooling measure, on private pty owner cannot buy HDB, this 1 quite effective.

Actually i m chasing after good location HDB resale at bishan, but suddenly new rule kick-in and i stop looking but still many agents called me to inform dat prices dropping as much as 20k-30k now. m i still interested?

However, there a surge in private pty, read the newspaper the number of new launches can tell...I think hot money is flowing into this safe haven red dot tiny state like waterfall , couple with the coming GE most likely in end Dec or early Jan next year.

This evening kena play out by an idiot old bird agent...within half an hour of viewing a FH old apt at aro $1000 PSF, i give a 1% cheq to him , on the way to get the owner sign the option he called me and say got someone offered 10k more than me and ask me the match this price...Apparently, he tot i desperate for the unit, my guess he fixed with the owner to squeeze me another 10k, thereafter divided the extra $...frankly there are many unethical agent around, trying to take advantage but not on me....i told him go and fly kite.....

Anyway, my take is interest rate will be still at super low within next 2 yrs...so its worth to capitalize on this and leverage on properties...my personal opinion only

Hi koh_52,

thanx for sharing. i do agree there r a lot of crooks in the property industry. but i suppose there should be a few good ones around as well..

IMHO, my personal take for is that if one havent purchased anything yet for investment yet, it would not be prudent to chase after it as prices has gone up a lot n thus risk has increased significantly, though there might be some upside. pls note that property is very illiquid n the transaction cost are very very high.. esp with the new rulings in place which requires one to pay stamp fees within a certain timeframe when he sell, etc...

seems to me everyone is trying to hop on and one of the reason is like u mentioned low interest rate environment. seems like a alarm to me when everyone is in herd behavioral mode..

one way to judge for oneself is to calculate yr net yield from a property investment.. taking into account higher interest rate than current in his analysis as a buffer, which will eventually happen, and in case prices come down at the same time n one is not able to sell it.. that should provide a margin of safety. of coz, if one is not able to rent out the unit to service the installment on the back of high interest rate, then that would be disastrous as he will have to dip into his own pocket to fork out the money.

just my 1 cent worth.

cheers,
bongster31

[koh_52]

There neither right nor wrong when to dip into property purchase (if u make money then u r smart, if loss money then u r wrong ) for me I do my homework stay sideline and follow the market closely, direct feel market sentiment, for this u pay a price for hard work.

When I found the right property at the right price, act fast and move my cash fund into it, of cos will take up some loan to leverage on low interest rate environment, ..so 1 may say I "tikum" no actually lar. Anyway sori I dun have the time to discuss in detail but personally I feel if u have sufficient fund now it a good time to consider FH property at good location, well I respect all differ views, it a healthy discussion dat is why a forum for.

[Miley Tipton]

Hi,
Well I guess all depends on market value, and other related factors,
but I don't think it is the right time to buy.

[sgd]

probably wait 3-4 years down the road. Right now there so much money in the market, so easy to get a loan, I hear FT working here are borrowing money from local banks here to buy houses back in their home countries because the rates here are cheaper than back home.

I'm no expert but The QE1 and QE2 money cannot last forever, this money is creating inflation everywhere, China has already raised interest rates so it's just a matter of time interest rates will come here too, when that happens business costs will go up companies will tighten - pink slips... layoffs ... retrenchments comes .. they will probably like before try to encourage companies to spare locals and chop FT.

if FT are cut they will go wherever there is employment so they will leave ... if many FT leave .. home rentals will likely collapse, home prices will follow it will be a buyer's market then.

if you buy now, you are paying inflated prices, based on july issue of economist magazine, says singapore house prices overvalued by abt 20% now it could be much higher. If you buy now if the housing market tanks you will be out of pocket.

If you wait and then buy when the market tanks there could be bargains but loans could come with higher interest by then.

[brattzz]

understand that sg garhment is going to let in another 100K of FTs? where will they stay? :O

[Jon-san]

understand that sg garhment is going to let in another 100K of FTs? where will they stay? :O

changi beach

Pros
good location, got free toilet, near hawker center and market, also got nice seaview and sunrise every morning, occasionally have chiobu go there for jog, got good sun for drying clothes too.

Cons
must constantly renew camping permit, quite often get teenagers peeping into your tent to see what you doing inside (lack of privacy), when it rains not many shelters around.



there goes another good freehold land

[brattzz]

lolz! wait SLA put up changi beach for sale!

beach front living!

[koh_52]

Good read...this writer is more bullish in property than me, but be careful...provided population keep on increasing if mass out flow of FT a sudden shrink in population occured, rental fall and all the 'loaners' will be in trouble, worst still if interest rate hike, then bubble burst liao...so weigh your risk vs gain carefully.

Five reasons why you should buy a property now

With house prices on the rise, despite the new cooling measures, is now really the right time to buy a property? Here are his five reasons why buying a property today could be the best decision you ever make.

1. Low interest rates
People with money to invest can use the current low interest rates , which are as low as 0.88% at present , to leverage a passive income from their purchased property. In fact, the returns from a property can be more than what a bank's fixed deposit account can offer.
For example, a unit at Southbank costing about $1.2million could generate a rental income of about $4800 per month, while the mortgage is about $3000. The buyer would enjoy a passive income of $1800 per month, as compared to depositing it in the bank to get 0.4% of around $1000 per year.

2. Property is an appreciating asset (eventually)
Barring any dramatic economic upheavals, property prices will likely stabilise or slowly, but progressively, increase from now till 2011. Most sellers will not want to sell at a lower price today, and will not suffer when paying a relatively high mortgage due to low borrowing costs. The 30% down payment rule will actually act as an incentive because purchasers, having come up with this capital, will not want to sell.
Provided you do not sell your property during the downturn , as you will almost inevitably lose money on it , the value should increase. The key is that the buyer must have holding power when the market deteriorates and should not buy until they have the holding power to weather any market conditions. Prices will eventually rise again , as witnessed in 2008, when prices were down but did eventually rise to and, in some cases surpass, the 2007 peak.

3. Assets beat playing the market
Many people will choose to purchase an asset like property because the market liquidity , essentially the asset's cash value , is still strong and, due to the last financial crisis in 2008, people felt safer putting the money in asset rather than financial instruments. The asset will always be there, and even when market conditions are not as good, as long as you do not sell it, you will not lose money.

4. Market conditions don't matter
Buyers who are looking at property as a long-term investment will be less concerned about the market's movement up or down.. Property will , nearly always , appreciate in the long term in Singapore due to the scarcity of land and available real estate. While having a diverse portfolio is preferred, as a long-term investment, property is generally going to make more money than other comparable instruments. Investing in bonds, for example, is a safe investment instrument, but capital appreciation is weak.
Property is not the ideal market for speculators though , not only has the government introduced measures to discourage property speculation , but you will be much more at risk of market fluctuations.

5. Property keeps on giving
Buying public housing in today's market is not cheap, with HDB's executive condominiums going at around $600 - 700psf, close to mass market private property prices. A HUDC unit has already reached the $1 million mark, and the trend looks set to continue. Parents may see buying an asset, not only as a hedge against inflation, but also as an eventual inheritance to their children. If house prices continue to rise , and with the cost of construction materials inevitably going to rise too , there is the fear that the younger generation could be priced out.

[Musicwhiz]

In my opinion, I think the writer over-states the gains and rewards from investing in property and understates the risks. Also, the time frame is too short as he is using 2007/2008 as an example.

In short, this is not very responsible writing as he does not provide a balanced view.

[Kalos_2]

Hi Koh_52 ,

Nice to hear from you on this forum. Would like to have your take of buying a HDB DBSS , now that the ceiling has gone to S$10,000. What / where and why are the good buy if there are any now coming on stream ?

Regards ,
Kalos_2