Property Market Sentiments

[dreamybear]

So mortgage rates have been and are still going up.

While I do not know the full T&Cs(assuming the standard ones), I feel low rates loan packages which offer a cap in interest rates for a couple of years(the bank must be confident in interest rates trends or super flush with cash) cld be a real bargain. For the more financial savvy/cash rich, it cld even be an arbitrage opportunity, get the 1% variable rate loan which locks in max 1.6% interest 1st 3 years and invest in say stable stocks(i.e. good stable track record and stock prices do not tend to fluctuate widely) offering much higher dividends, and pocket the difference - "almost free" money for 3 yrs.

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https://www.channelnewsasia.com/singapor...ns-2750501
"....Already, the Singapore Overnight Rate Average (SORA) – one of the benchmark rates used by banks here to determine rates for their floating-rate home loans – has increased by more than 100 per cent since early this year, said SingCapital’s chief executive Alfred Chia...."

https://stocksnsavings.blogspot.com/2022...ncome.html
"....The bank wrote that in view of the increase in their FHR6 (6 months Singapore Dollar fixed deposit interest rate), they will be raising my mortgage rate from 1.00% to 1.55% p.a. accordingly.....The bank promised to cap the maximum interest rate at 1.60% p.a. throughout the first three years...."

[donmihaihai]

There are lot of risk takers who are able to find opportunities.

Almost risk free is not risk free. There is a huge difference. A zero is zero even if it happen only 1 out of 100 times.

Of course, whether taking up the risk or not is on the risk taker. But I believe peoples are not good at measuring risk. In time of stress, like current tech and crypto or property in China, how the risk taker act determine the outcome. Ie if the risk taker is not able to act in a rational way in time of stress, good luck.

[weijian]

So mortgage rates have been and are still going up.

While I do not know the full T&Cs(assuming the standard ones), I feel low rates loan packages which offer a cap in interest rates for a couple of years(the bank must be confident in interest rates trends or super flush with cash) cld be a real bargain. For the more financial savvy/cash rich, it cld even be an arbitrage opportunity, get the 1% variable rate loan which locks in max 1.6% interest 1st 3 years and invest in say stable stocks(i.e. good stable track record and stock prices do not  tend to fluctuate widely) offering much higher dividends, and pocket the difference - "almost free" money for 3 yrs.

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Every now and then, people are thinking of ways to maximize their upside. When that happens, it means everyone is still bullish enough.

Value investing is timeless, why? Because rather than maximizing the upside, which is a very human trait (and it is absolutely vital to us to advance as a species), value investing espouses minimizing the downside.

These "carry trades" (the most famous one been the yen carry trade) mentioned are a dime a dozen. But I reckon I will stick with permanent capital.

Permanent capital is not just restricted to cold hard cash or availability of your own capital. It is much more - How dependent am I on the salary from my job? (for employees like me). What are my future liabilities? How can I generate the cash when all correlations hit one. How can I afford to be greedy when others are fearful?

[ksir]

It's just human nature to think we're smarter than others (including this post! haha).
Even the deal with better odds such as Buffett's arbitrages in buying Activision Blizzard is just a good-odds with okay-only payoff.
How many people can pull such smart trades with good outcomes? 5%? I bet is less than 1%.

Isn't it just funny when smart people such as Animal Spirit folks talking up Bitcoins & even established Bitcoin ETF and when Munger said bullshit coins, they looked down at him like he's an old silly dog! haha ohh.. how that smart arse attitude has changed now!

Making money in investment is simple but hard, thinking you can outsmart other professionals who are full timers in their own game is a recipe to doom.

[weijian]

Isn't it just funny when smart people such as Animal Spirit folks talking up Bitcoins & even established Bitcoin ETF and when Munger said bullshit coins, they looked down at him like he's an old silly dog! haha ohh.. how that smart arse attitude has changed now!

To be fair to those guys, they are wealth managers/advisors. So when the ducks quack, you need to feed them. As Munger said, it is all about the incentives.

https://ritholtz.com/2021/12/introducing...ndex-smas/

And this from them, doesn't age very well:

“Don’t put all of your eggs in one basket” is as old as time. With a nascent asset class like crypto, we think it’s the prudent way to invest.


P.S. I do read what these guys are writing (and they have a lot of useful stuff that I learned) but I do not remember they having the "audacity" to "look down" on Munger!

[ksir]

They did that several times in their animal spirit & the compound youtube videos whenever Munger said shxx about bitcoins (I remember one was the Daily journal meeting).
I almost never miss their shows, mainly to catch what's on their topics (trends) and what are they blowing (especially the compound show) and try to avoid all of them! haha.. It's working satisfactorily well, at least thus far.

I do think they have good intention of course, but acting smart while being "played" by the Mr Market (as they watch him too closely), is definitely not a way to beat the market.

[weijian]

I see. While I do read what they write, and podcasts are part of my learning medium, but I do have the presence of mind not to use my precious limited time (probably 60-90mins per episode) on listening to Animal Spirits!

These guys are wealth advisors whom have to address questions from readers/clients. So watching Mr Market closely is 1 of their jobs. In their job, it is better to show that you have an understanding, as ignorance would be an embarrassment. Perhaps, one benefit of been an OPMI is there is no need for pretense to mark the outer score card.

In their recent writings, I do feel it is hilarious on the amount of "reminders" that they are sending out to "keep calm and focus on the long term".

[dreamybear]

So the 126sqm 24th floor flat, with 51 years and nine months left on its 99-year lease, was sold a week after listing. The existing owners bought the unit at approximately S$870,000 about 11 years ago. The unit has an unblocked view of East Coast Park from every window in the house.

Different people have different opinions. But based on utility value objectively, it may not be a poor decision(even considering wear and tear), especially with the currently available alternatives. For simplicity of calculation, $1m divided by 51 years is ard $19.6k per year or $1.6k per month. Additional bonuses include :
- assuming sea views which remain unblocked for the rest of the tenure : spark joy everyday
- near Tao Nan School

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5-room Marine Parade HDB flat with panoramic view of East Coast Park sold at record S$1.01 million
https://mothership.sg/2022/07/marine-par...e-million/

https://www.straitstimes.com/singapore/h...the-estate

[Big Toe]

If buying a house to stay, it is rather personal. And waking up to a great view, can lift one's spirit, which cannot be quantified in dollars and cents. It reminds me when I was in a friend's house in taiwan, Keelung. It is on a very high floor on a very tall apartment with the back facing a mountain and the living room facing the sea. His business back then was hotpot restaurants and handphone shops, with branches mostly in taipei, so it is not exactly near where he stays. But I can totally understand why he bought the apartment and chooses to stay there.

Houses near the sea will have appliances, fitting corrode much faster. We just have to be aware of that and accept that fact.And if the opportunity arises, it feels right and is affordable, just have to go for it.

[dreamybear]

Wow, your friend's place sounds like a dream house to me; no puns intended. Being "addicted" to the sea, I had dreamt of migrating to a place like the lovely Hualien.

Years ago when I visited one of the Keppel Bay condos, someone(likely the housing agent haha) remarked something like : the front facing the sea(flowing water symbolizes wealth) & the back facing the mountain(got 靠山) => superb feng shui, which is really tempting despite me knowing little abt feng shui. I feel the location is a bit inconvenient though.

But what I do know is the price must be fair, haha. Incidentally, I think it's not realistic to expect huge price drop in SG now or in the future like during the past crisis, i.e. no chance to buy cheap anymore.

Indeed, a good house can help build a lovely home. At the end of the day, our time on earth is so short, why not make the best out of it ?