Is sg property cheap now?

[donmihaihai]

Not just time. 350k should be without interest portion. Total cost will be higher and with yearly repayment and I think the owner cleared his loan. The annualised return is actually quite Low.

At that year, I would also bet that west and north area hdb around 100k. Logically.

The valuation for a lot of properties is only for 20 to 30 years. Unless cap rate go down to 2%.

Yes and I also wrote in another thread that if paying by CPF, they also help calculate the “opportunity cost”, which I think is a good policy to anchor people to earth, though there’s a lot of misconception over this. In inflationary environment with 4X leverage, the experience of stay-in home buyers are generally good even if the ROA is actually just ok over the years.

True. Other than gaming the system by getting cash out of cpf. Many are not better off by much. Of course depend on the period. It is better to forget about last 10 years.

If we think in term investment and not buying to stay, one has to be rational

[dreamybear]

Talking Point 2019/2020 - EP4
Thu 2 May 2019 - Is My Flat Worth A Million?
https://video.toggle.sg/en/series/talkin...ep4/793503

A HDB home owner at Tiong Bahru is looking to sell his flat for more than $1 million which is the price some of the nearby flats transacted at. The shocking thing is he bought it at $350k only !!! ......

I think people generally forget to reference price with time: How long was it and the compounded CAGR return? Secondly generally housing has a positive experience bias due to inflationary environment and people tends to hold very long term rather than trying to be smart

But the L99 issue potentially could disrupt this experience depending on how the govt manages it

According to the video, it's about 15 years. I think it's quite complicated to calculate CAGR due to varying factors such as amt of downpayment/loan, loan interest rates, etc. But it shd be a multi-bagger in stock investing terms(based on initial capital/interest payments forked out - there's usually leverage used in ppty).

However, I believe not every HDB bought directly from the govt can achieve this type of appreciation, e.g. the location must be good. In fact, I know of another location where the owners paid abt $200k and the going rate is currently abt $900k, also abt 15-20 years. If I am not wrong, the owners had undergone SERS for that location.

I guess the main point is those of us who are not lucky enough to buy a good location HDB from the govt(e.g. thru' SERS, "lucky" ballot) and ended up buying re-sale will not be able to get that type of returns. Some of us might even make a loss(due to the 99 yr depreciation and no en-bloc like pte ppty) and I am not talking abt those million dollar flats. Though a flat is primarily for staying and not for speculation, who wld not want captial appreciation thrown in FOC ?

With a sum of money, one can either top-up and upgrade to private property or buy another cheaper HDB, invest the rest for passive income.

Separately, some good news for potential pte property buyers - The Woodleigh Residences launch price slashed by up to 13 per cent (May 8, 2019) More details at : http://finance.theindependent.sg/the-woo...-per-cent/

[Big Toe]

First of all one needs to identify whether it is for own stay or for investment purpose.
For own stay, price does not really matter so long as one can comfortably afford it and is happy living in it.
There is no price tag for happiness.

If it is for investment. One will need to dig into the very finest details. At this juncture, low yields, high prices, and a good chance of interest rate hike. One would be better off investing in something else. Do remember that banks are trying their very best to increase their net interest margin and there is only one way to do so.

[brattzz]

Don’t forget there is the greater population demand target of 6.9m or even 10m!! What sg gov say, sg gov will deliver!

[dreamybear]

Five-room HDB flat at Tiong Bahru View sold for $1.2 million
By Amy Tan / EdgeProp Singapore | May 17, 2019 11:11 AM SGT

In April, a 1,205 sq ft, five-room, build-to-order (BTO) HDB flat at Tiong Bahru View in Bukit Merah was sold for a record $1.2 million. This is the first time that the price of a standard HDB flat surpassed non-standard flats such as Pinnacle@Duxton units, DBSS (design, build and sell scheme) units, terraces and maisonettes, according to OrangeTee & Tie (OTT)....

.....“Following this [$1.15 million] deal, some owners of four-room flats in the same development are expecting to sell their flats at similar price levels. However, only five-room HDB flats located on a high floor can command such prices because the valuation supports it. For four-room flats, the valuation is still around $900,000,” says Ho......

.....Tan reveals that the buyer was looking for a HDB flat that is within close proximity to the city as he was previously staying in the central area. “His children actually advised him against buying the flat because they were in favour of him buying a new condo for capital growth and wealth accumulation,” he says. He adds: “Such buyers just want to buy the flat and pay for it with cash. They don’t need an exit strategy. They just want a convenient place to stay”......

More details at : https://www.edgeprop.sg/property-news/fi...12-million

[BlueKelah]

Don’t forget there is the greater population demand target of 6.9m or even 10m!! What sg gov say, sg gov will deliver!

Question is what is the delivery timeframe for this. Already tried importing more FT and ah tiong, hows that working out?

[corydorus]

Condo has much higher maintenance fee. However HDB more than a Million do not seems to make investment sense. So I would think if we going for monthly cost saving and no plan to make capital gains, then 1M HDB may make sense.

[dreamybear]

Condo has much higher maintenance fee.

My understanding :
- For newly completed mass mkt condos, the maintenance fees can be ard $300-$400, for facilities, car park and security.
- For older condos, the maintenance fees are higher due to sinking funds.

VS

- For a 5 rm HDB flat, the conservancy + sheltered car park fees r around $200. Yes, from time to time, the govt may announce few mths of subsidies a year.

Taking the potential for en-bloc + facilities(assuming u/family hv the time to use) + self-esteem/SES(subjective) into consideration, I do think condo is more worthwhile, unless maybe the HDB flat has SERS potential.  

[Porkbelly]

It is unwise to consider the home we live in as an asset.

It might be useful to know its market value, just for knowledge.
In any circumstance, we need shelter. Selling our home for a gain will
very likely cost a similar amount to replace.

Unless the replacement home is in an area that has low values.
It would also very likely have poorer amenities and further away from
central areas. School ( if there are kids ) will be further away too.


Or a smaller home in the same area. Which means discarding furnishings and
coping with a smaller home.

I consider a home to be a personal sanctuary. Having the home being sold
as en bloc or SERS can be a bonus but the process of getting a replacement can be
very tiring, with anxieties. It may also come at a time when we are much older and
loans may not be so easy.

[specuvestor]

I think own use property is generally prepaid expense. Value of pre-paid expense going up means cost of living going up, and a comparable switch to other dwelling may not be beneficial unless one switches between pte -HDB L99. Expense is actually still expense, just that the annual rate is locked in when you purchase the HDB.

https://www.valuebuddies.com/thread-4574...#pid149062

Probably only FH can be considered Asset per se for self-stay, though I know many argue on the gazette possibility.