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Possible Reason For the Property "Increase"
07-01-2018, 09:08 PM,
Post: #21
RE: Possible Reason For the Property "Increase"
Let me add some pointers that I am aware of, to this current discussion:

1) A couple can buy 2 properties without being affected by the ABSD, by putting each property under a single owner.

2) I personally know a few family owned, private developers. These guys are large enough to list easily, but do not do so as they are mostly family and privately owned, and prefer to maintain control.
Their comments (on separate occasions) regarding the current situation, are strikingly similar.
The current uptick in the property sector is driven largely by positive sentiment, particularly so with the recent all time high en bloc fever in recent years.
Yet all those doing en blocs are all public listed companies. Their landbanks have been decimated in recent years, and they have to look in the secondary market to find en bloc deals to show activities to their shareholders.
The 2 privately owned developers that I know are not holding on to any more private residential projects.
They still dabble in related projects such as dormitories, HDB projects etc, but most of their activities revolve around Australian projects currently.

3) Add approximately $300 psf or so to the en bloc prices, and a redevelopment charge to be paid to the gov, and you have an estimated approximate $1,600psf in breakeven costs for non-core projects. This means that in the next 5 years, many developers expect to be able to move units at $1,700-$1,800 psf type of pricing for non-core, suburban projects! This is not my own estimation, again, this is derived from my discussions with people in the industry. Privately owned developers are staying out of this game, as they are not confident of achieving this price level. Yet, they don't seem to know for sure that this level can't be reached either.
In short, even being in the industry, they can't predict the craziness of the demand, but think that working at such price levels is too optimistic, and would prefer to stay out first.

4) The failure to garner adequate land to replenish their land bank is the result of aggressive bidding by foreign competitors, some of which are willing to bid at such razor thin margins, that even if everything goes smoothly, it'd hardly add to earnings. The project is done just to sustain their current operations.

5) The gov has started to place more emphasis on other factors in the tender process, other than just pricing.
In recent tenders, the cheapest bid did not win.


6) Certain foreign developers (particularly the chinese), have a really terrible reputation within the industry.
Personally, what I heard makes me really hesitate if the project is done by a chinese developer.

7) Wont elaborate too much on this point right now as yet, but within the industry, every player knows that the gov's recent push in the industry for productivity gains etc, has been an abject failure.
Nobody likes it, and basically, those who talk about it in the media positively.... are just bullshitting.

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07-01-2018, 11:54 PM,
Post: #22
RE: Possible Reason For the Property "Increase"
Point 6) most important factor in all this. Endless money pouring in from Ah Tiong!! When the money stops pouring in only we will see the aftershock!
Virtual currencies are worth virtually nothing.
http://thebluefund.blogspot.com

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08-01-2018, 05:53 PM, (This post was last modified: 08-01-2018, 05:54 PM by brattzz.)
Post: #23
RE: Possible Reason For the Property "Increase"
(07-01-2018, 11:54 PM)BlueKelah Wrote: Point 6) most important factor in all this. Endless money pouring in from Ah Tiong!! When the money stops pouring in only we will see the aftershock!

yeah, there's no end to the Renminbi sir... more coming! Big Grin
sg gov, sell sell sell land at peak prices! Big Grin beef up our reserves! then get temasick/GIC to re-invest back the renminbi to china's property investments!
we got plenty of land to sell too!

huat har SG gov! Big Grin
1) Try NOT to LOSE money!
2) Do NOT SELL in BEAR, BUY-BUY-BUY! invest in managements/companies that does the same!
3) CASH in hand is KING in BEAR! 
4) In BULL, SELL-SELL-SELL! 

Find Reply
08-01-2018, 07:48 PM,
Post: #24
RE: Possible Reason For the Property "Increase"
(07-01-2018, 09:08 PM)TTTI Wrote: Let me add some pointers that I am aware of, to this current discussion:

1) A couple can buy 2 properties without being affected by the ABSD, by putting each property under a single owner.

2) I personally know a few family owned, private developers. These guys are large enough to list easily, but do not do so as they are mostly family and privately owned, and prefer to maintain control.
Their comments (on separate occasions) regarding the current situation, are strikingly similar.
The current uptick in the property sector is driven largely by positive sentiment, particularly so with the recent all time high en bloc fever in recent years.
Yet all those doing en blocs are all public listed companies. Their landbanks have been decimated in recent years, and they have to look in the secondary market to find en bloc deals to show activities to their shareholders.
The 2 privately owned developers that I know are not holding on to any more private residential projects.
They still dabble in related projects such as dormitories, HDB projects etc, but most of their activities revolve around Australian projects currently.

3) Add approximately $300 psf or so to the en bloc prices, and a redevelopment charge to be paid to the gov, and you have an estimated approximate $1,600psf in breakeven costs for non-core projects. This means that in the next 5 years, many developers expect to be able to move units at $1,700-$1,800 psf type of pricing for non-core, suburban projects! This is not my own estimation, again, this is derived from my discussions with people in the industry. Privately owned developers are staying out of this game, as they are not confident of achieving this price level. Yet, they don't seem to know for sure that this level can't be reached either.
In short, even being in the industry, they can't predict the craziness of the demand, but think that working at such price levels is too optimistic, and would prefer to stay out first.

4) The failure to garner adequate land to replenish their land bank is the result of aggressive bidding by foreign competitors, some of which are willing to bid at such razor thin margins, that even if everything goes smoothly, it'd hardly add to earnings. The project is done just to sustain their current operations.

5) The gov has started to place more emphasis on other factors in the tender process, other than just pricing.
In recent tenders, the cheapest bid did not win.


6) Certain foreign developers (particularly the chinese), have a really terrible reputation within the industry.
Personally, what I heard makes me really hesitate if the project is done by a chinese developer.

7) Wont elaborate too much on this point right now as yet, but within the industry, every player knows that the gov's recent push in the industry for productivity gains etc, has been an abject failure.
Nobody likes it, and basically, those who talk about it in the media positively.... are just bullshitting.

thank you for the insight. would like to hear more about 7) if you dont mind and can spare the time!

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14-03-2018, 09:51 PM,
Post: #25
RE: Possible Reason For the Property "Increase"
https://www.channelnewsasia.com/news/sin...ve-9996102

Becoz developers are bidding aggressively for lands. Imagine EC will be selling more expensive than the condo in the market now...

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15-03-2018, 01:24 PM,
Post: #26
RE: Possible Reason For the Property "Increase"
(08-01-2018, 05:53 PM)brattzz Wrote:
(07-01-2018, 11:54 PM)BlueKelah Wrote: Point 6) most important factor in all this. Endless money pouring in from Ah Tiong!! When the money stops pouring in only we will see the aftershock!

yeah, there's no end to the Renminbi sir... more coming! Big Grin
sg gov, sell sell sell land at peak prices! Big Grin beef up our reserves! then get temasick/GIC to re-invest back the renminbi to china's property investments!
we got plenty of land to sell too!

huat har SG gov! Big Grin


oops looks like spoke too soon. With the recent forced sell-off in overseas property investments in big company like Wanda & HNA, it seems that Chairman Xi has managed to turn off the taps further, hopefully not too much pain in the coming year. I am expecting all the en-bloc fever from last year will suddenly die down and Chinese developers may have to start exit Singapore, especially if they are unable to get easy funding to develop the projects from back home.
Virtual currencies are worth virtually nothing.
http://thebluefund.blogspot.com

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29-04-2018, 09:50 AM,
Post: #27
RE: Possible Reason For the Property "Increase"
Hi, its been a while.

Things have certainly started to heat up in the property sector with the recent increase of 3.9% in private home prices in Q1.

The Winner's Curse is certainly in full swing.

To put things in perspective, below are some (definitely not all) of the recent developments that had offered or offering the DPS:
 
OUE Twin Peaks, The Interlace, Fulcrum, Mon Jervois, Gramercy Park, Marina Collection, Leedon Residences, TwentyOne Angullia Park, Llyod SixtyFive, The Line @ Tanjong Rhu, 26 Newton, The Peak @ Cairnhill, Reflections at Keppel Bay, The Crest, Kingsford Waterbay (they even have a DPS calculator webpage)

The DPS assets or sales are somewhere in OUE and Chip Eng Seng's balance sheet. The DPS started with OUE in March 2016. Hence, any hints of defaults will only manifest itself after Q2 (earliest). Watch out for this factor to maybe get a feel of the health & sustainability of the DPS.

Ending note:
"The less prudence with which others conduct their affairs, the greater the prudence with which we should conduct our own affairs.” 

It is the last stretch, take care and caveat emptor

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29-04-2018, 12:12 PM,
Post: #28
RE: Possible Reason For the Property "Increase"
things for certain,

1) Interest rates going up
2) +2% GST in 2020
3) En-bloc prices are much higher than existing developments

guess that's why it's a buy-buy-buy!! Tongue
1) Try NOT to LOSE money!
2) Do NOT SELL in BEAR, BUY-BUY-BUY! invest in managements/companies that does the same!
3) CASH in hand is KING in BEAR! 
4) In BULL, SELL-SELL-SELL! 

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