Is sg property cheap now?

[weijian]

hi dreamybear,

Housing is indeed a complex issue, especially in the case of public housing (and been "public" in nature, one cannot escape politics).

Since it is complex, it probably cannot be looked at from a singular perspective. Heck, maybe the holistic solution/s isn't going to come from housing too! Or maybe there will never be good enough solution/s for everyone. Someone will win, someone will lose in democratic capitalism (communism anyone?)

But one thing is for sure - on a net-net basis, it is better to have asset inflation than asset deflation for the general populace! If this is the system that we are left with and there are little choices, then one just have to find work-around solutions to it.

[specuvestor]

It's more complex taking into account psychological feedback and anchoring issues. Just look at Japan past TWENTY years. And there are also other factors like personal safety, safety of asset, traffic, tax, culture etc

land has to be part of the pricing else the gap between public and private is too wide and non competitive. It's like saying NTUC Fairprice dont have to pay rent.

hi dreamybear,

Housing is indeed a complex issue, especially in the case of public housing (and been "public" in nature, one cannot escape politics).

Since it is complex, it probably cannot be looked at from a singular perspective. Heck, maybe the holistic solution/s isn't going to come from housing too! Or maybe there will never be good enough solution/s for everyone. Someone will win, someone will lose in democratic capitalism (communism anyone?)

But one thing is for sure - on a net-net basis, it is better to have asset inflation than asset deflation for the general populace! If this is the system that we are left with and there are little choices, then one just have to find work-around solutions to it.

[dreamybear]

I wonder how prevalent is the practice and whether it is largely confined to new launches ...

Note that the 1st 2 below are for subscribers.

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Iras probes home buyers who used ‘99-to-1’ loophole to avoid paying ABSD
https://www.straitstimes.com/business/in...aying-absd
"....The Straits Times has learnt that letters are being sent to some first-time buyers of private real estate asking them to explain why they sold just 1 per cent of the same property to a relative barely a week after exercising the purchase option...."

Only first-time buyers can own homes in 99-to-1 shares from the start
https://www.straitstimes.com/business/in...-the-start
"Couples buying their first private property can own it in unequal shares of 99 to 1 from the start if they plan to pick up another one in the future. The additional buyer’s stamp duty (ABSD) does not apply to first-time buyers and so they can choose to hold their property in any manner...."

The risks of buying properties in 99-to-1 share
https://cos.sg/blog-post/the-risks-of-bu...o-1-share/

[CY09]

"....The Straits Times has learnt that letters are being sent to some first-time buyers of private real estate asking them to explain why they sold just 1 per cent of the same property to a relative barely a week after exercising the purchase option...."

This is a symptom of inequality in our country. Why relatives are roped in is because the relatives are the party able to service the loan of the original buyer. What I know is that it tends to be the parents who are the ones helping their children to own as first time private home buyers. Why is this prevalent? This is because property in Singapore is an excellent store of wealth with government immigration policies helping to sustain increased price increases. So rich families will do their upmost to help their children own their first private property; paying only 1% in ABSD/SD is a cheap price to pay in exchange for a property that appreciates about 4-5% per year.

Personally I'm for a policy where the property tax for private properties are increased. This will solve the inequality problem and improve tax revenue. However, what I am personally witnessing is that the increase to the property tax bracket for private properties is painfully slow (in my view) [Most condos will see their tax go up from 6% to 10% within the next 2 years, however, I feel it should be moving to 15% which is the approximate rates in other developed economies]

For those who are born poor, Im sorry that you are born here

[weijian]

For those who are born poor, Im sorry that you are born here

Hi CY09,

I think we have to put ourselves into a global context. Been born in a place that is absence of war, civil conflicts or natural disasters, I believe some of us already won the ovarian lottery. Maybe not 1st prize lottery as Warren Buffett suggests but it is a good enough prize.

If we look close enough, there are more than enough things to complain (uneven distribution of wealth, MRTs breakdown, where is the Swiss standards of living?). But when we look wide enough, there are more than enough things to give thanks for.

[propwise55]

https://www.straitstimes.com/business/in...ing-income

Came across a recent news article about over 280 landlords being caught by the Inland Revenue Authority of Singapore (IRAS) for under-reporting their income. The rental market is booming right now, and this serves as a critical reminder for all landlords to ensure that there is accuracy in reporting rental income and staying compliant with tax regulations even with the property hype in Singapore.

[dreamybear]

I think we also need to consider factors like 
- for countries like Japan, Korea, citizens can choose to settle in a lower cost city within the country
- life is unpredictable, humans may face lifestyle changes e.g. having children, unexpected retrenchment, illness so may not be able to just consider rise in household income

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IN FOCUS: With rising private home prices, is climbing the property ladder harder?
https://www.channelnewsasia.com/singapor...ty-3612396
"...Dr Lee noted that compared with many other global cities, Singapore private housing “does not do too bad”, as the housing-to-income multiple is much higher in other Asian cities: 29.3 in Beijing, 35 in Shenzhen, 26.5 in Hong Kong, 17.8 in Tokyo and 17.3 in Seoul....

In 2022, the median household income was S$10,099, a 33 per cent rise from S$7,566 in 2012. In the same period, the median condo price rose from S$1.07 million to S$1.59 million.... "

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Rise of young condo owners: The great wealth transfer in Singapore
https://www.asiaone.com/lifestyle/rise-y...-singapore
"...Look, I love property as much as anyone; that's why I write all this. But we can't afford to have a situation where everyone uses their newfound wealth to buy condos and try to collect rental income.

Capital locked up in properties isn't circulating into the stock market, new start-ups, helping to create new jobs, etc. We're a small country and we need to keep that edge...."

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The Big Read in Short: Retrenchment blues for young workers
https://www.todayonline.com/big-read/big...rs-2206941

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Cancer Happens to 1 in 3 Singaporeans
https://www.rafflesmedicalgroup.com/heal...ngaporeans

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Speech
https://www.moh.gov.sg/news-highlights/d...s-day-2021
"... Locally, one in three individuals in Singapore is at risk of developing diabetes in their lifetime. If nothing is done, by 2050, it is estimated that about one million Singaporeans will be living with diabetes...."

[CY09]

If you look at places like seoul/tokyo, the proximity of 15km away from centre of the capital is another city (incheon) (Kawasaki/yokohama).

In Singapore's context, it is not fair for us to always be comparing with the mindset of seoul vs tokyo vs singapore. In fact the time taken to travel from Jurong/pasir ris/Woodlands to raffles is equivalent to travelling from yokohama to tokyo or incheon to seoul. Like for like, the lower cost cities in these countries are cheaper than our outfringes area.

In a sense, Singapore is indeed expensive for housing

[Choon]

If you look at places like seoul/tokyo, the proximity of 15km away from centre of the capital is another city (incheon) (Kawasaki/yokohama).

In Singapore's context, it is not fair for us to always be comparing with the mindset of seoul vs tokyo vs singapore. In fact the time taken to travel from Jurong/pasir ris/Woodlands to raffles is equivalent to travelling from yokohama to tokyo or incheon to seoul. Like for like, the lower cost cities in these countries are cheaper than our outfringes area.

In a sense, Singapore is indeed expensive for housing

This is really good insight.

[brattzz]

it has to be expensive! there's no other way..., sg gov is "selling" the land out for 99 yrs, and investing the proceeds from the land sales (GIC/Temasek), take the interests/dividends to finance/supplement singapore economy and policies!

In fact, anything that sg gov can extract revenue out, must be taxed!!, eg, GST, COE, property taxes..etc!

https://ask.gov.sg/mof/questions/clgotv5...08i0ptosz1

The investment returns from our reserves provide additional resources for Government spending to benefit Singaporeans. This includes Government investments in education, healthcare, transport infrastructure, R&D and other areas to improve our living environment and to grow our economy.

The ability to tap our reserves in a sustainable manner is a significant financial advantage for Singapore. Our situation is quite unlike that in many countries that have to service their debts and other liabilities from their budgets on an annual basis, and hence either raise taxes for the purpose or engage in further borrowings so as to service current borrowings.

In Singapore, the Government is instead able to take in money from the investment returns of our reserves to supplement our Budget on a sustained basis, in keeping with the provisions in the Constitution. The few other countries where Governments are able to derive net investment income for public spending are typically those with substantial reserves of natural resources such as oil.

The investment returns of our reserves supplement the annual Budget through the Net Investment Returns Contribution (NIRC). The NIRC is estimated to be SS$21.6 billion in FY2022, or 20% of our budget.