Resale HDB flats hit a record high price fueled by demand from PRs
January 5th, 2010 | 
Author: Written by Our Correspondent
Despite the sluggish economy, the prices of resale HDB flats continue to rise, hitting a record high in the fourth quarter of last year.
Figures released by HDB show prices rose by 3.8 per cent in the fourth quarter and 8 per cent in all for the entire 2009. HDB flat prices have risen almost 40 per cent over the past three years.
The Resale Price Index (RPI) hit 150.7 in the fourth quarter, up from the third quarter’s 145.2 and far beyond the previous peak of 136.9 achieved in the fourth quarter of 1996.
According to property analysts, the sky-rocketing prices is due to demand outpacing supply, fueled particularly by PRs over-paying for resale flats in prime areas.
One Indonesian PR paid $653,000 for a 4-room resale flat in Queenstown when he could easily afford to buy a condominium.
Singapore PRs are allowed to purchase HDB flats in the open market and sell them for a hefty profit years later.
There is no minimum period of residency in Singapore before a foreigner can apply for PR or to buy a HDB flat.
The ruling party’s pro-foreigner policy, especially towards the PRs enable them to exploit loopholes in the system to their own benefits.
There are stories of PRs, especially Malaysians, who retire comfortably back to their homelands with a lump sum from the sale of their HDB flats in Singapore.
An earlier report by ERA Real Estate Agency reveals that 40 per cent of its buyers of resale HDB flats are PRs.
PropNex chief executive Mohamed Ismail said that permanent residents estimated that PRs made up 20 per cent of his agency’s total HDB sales.
The managing director of C&H Realty Albert Lu claimed that PRs account for as high as 50 per cent of all HDB resale transactions.
National Development Minister Mah Bow Tan told parliament lately that PRs are “under-represented” in the HDB resale market without substantiating his statements.
He subsequently admitted that he has been “caught off guard” by the relentless rise in the prices of HDB flats.
However, he was quick to reassure that HDB flats remain “affordable” to ordinary Singaporeans and it is a “good thing” that prices continue to rise as it “generates wealth” for Singaporeans.
As the prices of new HDB flats are pegged to that of resale flats, the prices of BTO flats have hit a record high as well.
A recently launched project at Queenstown fetched prices of over $500,000 and $600,000 for four and five room flats respectively.
One financial consultant warns that only couples who has a combined monthly income of more than $7,500 can consider buying these flats and even then, they will have to deplete their CPFs on top of forking out a few hundred dollars in cash just to finance the housing loan.
While public housing is being increasingly priced out of reach of Singaporeans especially the young, the Ministry is busy building low-cost public housing for the mainland Chinese in the Tianjin Eco-city, a joint project between the Singapore and Chinese governments.
Posted in Editorial
Mr Mah said this in 2007. Should he be accountable for his words.
“There is actually a lot of supply available. Stand back and let the others rush. If you want to follow the crowd, you must be prepared to take higher risks. “Why should 10 people rush for a flat when there are others around?” The Government is monitoring the situation, he added, and — within the next two to three years — there will be “ample supplies” across the various categories. Home owners and those looking to rent or buy must arm themselves with the right information and differentiate between fact and speculation, said Mr Mah.
it is a joke if mah is honest.
If our fellow singaporeans whose “tua kong’” education was sponsored through taxpayer-funded scholarship continue to make decisions merely based on some erudite”decision tree analysis” in their cool air-con ivory towers,more and more of us would eventually be ‘walking’ and sleeping on the streets.
i have had spoken to a few PRs working as FTs here and they actually told me that they are looking to buy HDB flats and later,RENTING it out.Then,they would also consider buying a “second house”,preferrably, a CONDO.
where some among us can’t afford a proper roof over their heads,these newbies are thinking of making money out of our plight?
LSS and other officials have categorically stated in no uncertain manner that they “welcome foreigners who CAN CREATE JOBS for singaporeans” but so far they have not only not live up to their words,they have actually EATEN THEIR WORDS and many among us got to EAT SAND!
And,BTW,these few sample FTs i spoken to,all taold me they would consider ’selling their houses when the price is right’,scoop the money on the table(much like they do in casino),pack and go!
NORMALLY,i would say “wake up singaporeans” but this time i must say, WAKE UP! MINISTERS…you are dreaming!
I don’t know exactly how other singaporeans think but as a parent and a property owner myself I fear for my children what I am seeing is happening to the property market.
What I gain from the market rise with my current property, I think will be paid back many times over by my children.
When I first started working 20 years ago, I also faced this fear of affordability but I feel the step I face is so much smaller than the people entering the working market today. Couple this with the insecurity of the job situation, I think its much harder for them.
I think when my kids come out to work in 7~8 years time, they will certainly face much worse and that’s fundamentally the biggest frustration of all.
It would also be impossible for any effort to depress the price of property as it will hurt alot of people.
What I hope to see a freeze of new HDB flat prices for a fix number of years to allow affordability to catch up to say 1999/2000 levels. This will immediately put the brakes on all property price increases. This will give hope to the young singaporeans.
Perhaps we should also levy a heavy capital gains tax on all PRs and foreigners. This includes if a couple is one citizen and one PR, than the PR portion gets tax too. This will close out loop holes in enjoying benefits of the capital gains.
I am sure there are details that need to be ironed out but we need to offer hope forthe younger generations that are starting work with zero savings. This worry of course is lost on those that has a family fortune to buy whatever they want.
STI index in 2000 was 2450.
STI index in 2009 (end) was 2800++
That means an rate of increase of about 1.3% per annum over the last decade.
Despite all the talks about improving the economy and company performances, since 1999 and their implementation, our companies are not doing very well compared to inflation or housing prices.
That’s with all the tax cuts etc.
Goes to show how poorly the PAP has been running the country.
Or companies are not growing its earning efficiently and they are just being fed by all the tax cuts and cheap labour.
A clear demonstration of the incompetency of the current PAP govt.
Add that to the list of other cock ups listed on this site, we have really been overpaying the current group of pigs.
The only to save ourselve and children is to vote out LHL because of his completely wrong immigration policy which will continue to cause suffering to us. Don’t believe what he said about slowing down the immgration process, it is just a number game e.g. first there is 500,000 PR and there was a 100% increase to 1000,000. Now the immgration process has slowed now as claimed by government and the increase is only 50%. But the number that increase is the same i.e. 50% of 1000,000 is 500,000. This has been used in the past and they still think it can fool everyone!
//Man on estreet
great comment
high prices = happy sellers
high prices = unhappy buyers
high prices = many ordinary singaporeans cannot afford HDB flats
high prices = inflation of other goods
high prices = your money in the bank is LOSING its value
high prices = happy or sad for you ??
LHL has also missed the point about 7-9% growth.
It is very important that the grow is sustainable and stays persistently positive.
(at least greater than a minimum rate)
Imagine you have an investment that grows like this:
-5%, 4%, 4%, 6%, -6%, 10%.
The effective rate of growth per annum is about 2% per annum.
Compare this with an investment that grows at 2% per annum for 6 years.
I think we would have better sleep with the latter.
The point is also, the volatility that we experience over the past decade where we had at least 2 major recessions is making it hard for people to decide when to invest and how.
The growth rate in China is not just big but persistent. It gives business more confidence to invest and lead to a virtuous circle.
The ones we had in Singapore resembles that a burst of one night stand followed by long periods of lull.
How to develop something sensible like this?
The GDP measure that the turncoat Bala and LHL is not good for all the reasons that were cited in this site but also because it has been volatile for Singaporeans.
What have they done (other than protecting themselves) to reduce the volatility?
Nothing.
if you read the following scheme, it resembles what GIC and TH are trying to do:
http://www.standrewseasternshore.org/Content/Documents/Document.ashx?DocId=54269
http://logos_endless_summer.tripod.com/id142.html
Don’t fall for the trap.
The scheme ended up with France suffering a long recession.
3 years ago my Malaysian PR acquaintance bought at Dover a 4 room for $280k. He is selling it now for $600k with COV.
The bloody fellow kept boasting about his windfall.
He will be leaving SG soon with his haul.
Me? I can’t even afford a flat…I DON’T WANT TO PROFIT FROM MY FLAT!! I just want a roof FOR SHELTER and START A FAMILY!!
Is it too much to ask?? A roof for myself in my OWN country?
Curses to Mah and may his family learn the feeling of homelessness!
LHL has also missed another point about 7-9% growth.
It is very important that the growth is sustainable and stays persistently positive.
(at least greater than a minimum rate)
Imagine you have an investment that grows like this:
-5%, 4%, 4%, 6%, -6%, 10%.
The effective rate of growth per annum is about 2% per annum.
Compare this with an investment that grows at 2% per annum for 6 years.
I think we would have better sleep with the latter.
The point is also, the volatility that we experience over the past decade where we had at least 2 major recessions is making it hard for people to decide when to invest and how.
The growth rate in China is not just big but persistent. It gives business more confidence to invest and lead to a virtuous circle.
The ones we had in Singapore resembles that a burst of one night stands in between sessions of lull.
How to develop something sensible like this?
The only GDP that matters policy measure and their related implementation that the turncoat Bala and LHL is not good for all the reasons that were cited in this site but also because it has made Singapore’s economy extremely volatile for Singaporeans.
What have they done (other than protecting themselves) to reduce the volatility?
Nothing.
I had wanted to add as well that if the growth rates are persistently positive and above a minimum rate, it will lead to greater investor’s confidence.
That was the setting left behind by the 1st generation of Singaporeans but were destroyed in 2 decades by LHL and the other related pigs.
http://www.tradingeconomics.com/Economics/GDP-Growth.aspx?Symbol=SGY
If we were to use the data that is show on the above link, we would obtained an annualised growth rate of about 4% per annum over the last 1 decade with a standard deviation of approximately 4.7% per annum.
This is not a specular growth rate at an acceptable variance and yet we all know how excessively well compensated the pigs have been over the past decade.
Why are we rewarding these pigs so much for a lousy performance? It is not a desired outcome of a growth policy. It resembles more like a hit and run policy.
If they are hedge fund managers, their funds will be redeemed in no time.
It’s a supply and demand thing.
When the MIW let in boatloads of FTs and give out PRs indiscriminately, without increasing the supply of homes, you get this type of situation.
…and since PRs can buy HDB re-sale apartments, the cash-rich PRs take advantage of it..
and speculation sets in… with COV offers of 60 – 100K .
The real losers are Singaporeans.
When will MBT who was ‘caught off guard’ by how the HDB resale market trended north in a recession year… wake up to the situation ??
Your guess is as good as mine.
Cveryone please stop complaining.
Most Singaporean don’t buy secondary market HDB.
Most Singapareans buy new hdb and buy close to parents HDB to get government discounts.
It’s the PR that are screwed. They can only buy Condo which are 1M+ or secondary market HDB which are 500k+.
PR can’t buy NEW HDB.
There are many sides to any story….
//Anonymous
you are evidently not a single.
you are also not one of those who bought a place in sengkang.
@Anonymous on Tue, 5th Jan 2010 4:53 pm
So locals are destined to live in new HDB estates
-poor location
-poor facilities
-poor transportation
-smaller flat sizes (many are 1 or 2 room only)
-far from parents living in older estates. Hence cannot get “discount”
????
PRs come to my country and take our jobs. As far as I am concerned, if not for them, I can buy a place near my parents in the older estate. Screw them!
Animal farm in action…”live” from singapore.
To those who can actually or should i say “allow” to vote under the existing artifical set of rules to protect low esteem pigs in their positions.
Please execise your mental facilities and to vote for Singapore and fellow singaporeans and for the future generations.
Made your stand with your vote…if in the end it fails…let us leave this “farm” to the real animals masquarading to be human beings when they are not and to be blunt…more worse then animals.
99% animals don’t eat their young or become parasites…it seems the PAP government truely feels they are better then any human being and perhaps even god him/herself.
Hubris will follow…you can siam and avoid and hide…but the final abiter is mortality and death itself smiling at you and welcoming you to what you ultimately deserve…a life of actual contributions to the human race and your kinder (children) future = zero.
I’m not a Singaporean nor a resident but reading this tells us there is definitely a serious flaw in the system if public housing prices are beyond the means of a working class citizen. Why would PRs be allowed to buy and keep public housing when their PR permits are issued for only 5 year? It doesn’t make any sense at all. Besides, the profits should be taxed for the benefit of taxpayers including being used to build and subsidise new and existing public flats. If the Singapore government has the intention to allow HDB flats increase in value, then allow a fixed maximum percentage of gains. Anything gains beyond that limit should be returned to the goverment. This would be much fairer.
For argument sake, let’s assume that anonymous is right that PR are screwed.
so, who’s screwing them, according to anonymous, it should be PRs too.
so conclusion from anonymous: PRs screwing PRs
What happens when the plankton dries up, there is fewer PRs to be screwed, shouldn’t the price fall? The unlucky ones to hold the parcel which is going to explode one day is PRs.
but if resale prices drop, won’t it affect the new flat prices too, afterall they are benchmarked to resale prices, so most singaporeans will in the end still be screwed.
CAN SOME RICH OIL TYCOON BUY THE ISTANA AT THE RIGHT PRICE?
HAHAHA!
WHAT I’M TRYING TO SAY IS THAT THE PEOPLE WHO VOTE OTHER PEOPLE TO TAKE CARE OF THEIR INTERESTS ALWAYS GOT SCREWED here in this UNIQUE place!
first they take away natives’ jobs.
now,they give away our shelters.
next,they chase natives out of the hospitals.
and in the end,we ourselves could just be the “aliens”?
unique gahmen indeed…can’t find in even third world countries.
I think I understand why PAP allow so many PRs and foreigners in.
MIW want their in-numerous luxury properties to appreciate in value so they have more money to run away and live like kings overseas, when Singapore is in deep shit?
Conflict of interest???
The world highest paid Fortune Teller said this recently : If our economy is good, our property value will goes up. If the economy is bad, our property value will goes down. But what happen the whole of last year 2009 which is the worst recession in the world, the value of HDB flats keep going up and up. Its time for him to stop predicting and forecasting anymore and donate back to society the millions of dollars to help those unaffordable Singaporean HDB buyers.
//feng shui master
probability of an old man dying at 86 is 50%.
probability of an old man dying at 91 (when he is 86) is 90%.
We are paying a guy who can claim no responsibility in his predictions and do not pay estate tax because his son removes it, millions of dollars predicting.
This is the joke
LHL will be the person to bring down Singapore if he is to continue as PM. What good has he done to Singapore in the last few years ? In my record, it is zero !!! It is the time to change the PM !!!
We are now in trouble. If the PRs are force by law to let off their flats, imagine it’s impact to the value of HDB flats. Government surely won’t let it happen.
But let so many PRs hold on the so big number of flats, how many percent of them will enventually stay in the end ? Most of them will surely sell off their HDB flats one day. It’s only a matter of time.
But who will complain other than those haven’t owned a flat ?
Hang Seng index (end year 2000) is 15000
Hang Seng index (end year 2009) is 22279.58
That represent an approximate growth rate of 4.9% per annum over the last 10 years.
I wonder how come our local companies are doing so badly in comparison with them. (STI grew about 2.7% per annum over the last decade)
even the Taiwan Index (TaiEx) fair a lot better than Singapore STI.
in spite of all the boastful talk but the Singapore Govt, S’pore companies are not improving or have not impressed the world in performance.
TaiEx (end year 2000): about 4740
TaiEx (end 2009): 8200
That resulted in a return of approximately 7%.
(add in the fact that Chen Sui Pian messed up the show for 8 years and they rank higher than Singapore in retirement monies)
PAP must have cocked up much worse than Chen Sui Pian.
FPC… You say that the STI started the year 2000 at 2400 and ended 2009 at 2800, then proceeded to blame the PAP for the measley growth.
Yahoo Finance won’t let me go as far back as 2000, but in Oct 2001, the STI was at 1400. It is now nearly 2900= growth of 107%
Dow Jones Industrials:
Oct 01: 8847
Today: 10535
Growth: 19%
Australia ASX 200:
Oct 01: 3300
Today: 4900
Growth: 48%
FTSE Index:
Oct 01: 4785
Today: 5500
Growth: 15%
Hang Seng Index:
OCt 01: 10,073
Today: 21,823
Growth: 116%
The stats speak for themselves. The STI has vastly outperformed the Dow,FTSE and Australian Indices, and it kept pace with the Hang Seng. In S$ terms, you could even say that the Dow and FTSE would have DEPRECIATED, since the US$ has fallen from about $1.84 in 2001 to $1.40 today (25% drop) and the pound has fallen from S$3 to S$2.25 today (25% drop). Sure, the A$ may have risen by about 25% against the S$ in the past decade, but 48% gain in the ASX multiplied by 1.25 gives a gain of 60% in S$ terms. Sorry but that still underperforms the STI’s gain in S$ terms by 107%.
DO all of you retards on this site want to see property values collapse like in the UK or the US? Have you seen what happened to their economies? Do you guys not remember what happened in 1997 when our property values collapsed? Do you SERIOUSLY want to see that happen again?
For the 90% of Singaporean families who own their own homes, do you want to see 90% of your fellow compatriots’ home values (and biggest asset) CRUMBLE just so YOU can enter the property market?
The monthly repayments on a $400,000 flat is $1441 based on a 2.6% interest rate and 10% deposit. The median annual household income in Singapore is $60,000. This EXCLUDES CPF. With CPF, the median household income should be $68,700 That makes for annual repayments of 1441 * 12 = $17,292 per annum.
17282/68700 = 25% of household income which goes into servicing your mortgage. What on earth is wrong with that?
If you want to talk about mortgage stress, in the beloved Australia that most of you love to heap praise upon:
The median household income in 2007 was A$66,000. Let us say that it has increased to A$75,000 today.
A A$400,000 house in Australia would cost A$28,790 a year to service based on their historical 7% interest rates. That is 38% of household income.
But considering their tax rates are high (most of you whiners on this site hardly pay any tax I would imagine)from this link:
http://www.abs.gov.au/Ausstats/abs@.nsf/7d12b0f6763c78caca257061001cc588/5f4bb49c975c64c9ca256d6b00827adb!OpenDocument
The average disposible after tax income for an Australian family is A$826 a week. OK that includes retired couples, so let’s take the Australian Capital Territory, which has the highest disposible incomes of all at A$1,026 a week, or about A$50,000 a year.
A $400,000 house would set that family back by…. $28,000 a year or 56% of disposible income.
But fear not though. Australian property sites and blogs are full of whiners whinging that Australian property prices are going through the roof because of government measures to keep the property market afloat, massive home owners’ grants, and of course, “relentless immigration”. Just replace “Singapore” with “Australia” and you get the same old whining and bitching from Australians who “think” they cannot enter the housing market and proceed to blame their govt, immigrants or god knows who else.
Sites like
http://www.creditcrunch.co.uk/forum/index.php?act=SF&s=&f=57
for example.
To all you people out there who want a property price collapse in Singapore, and for 90% of your fellow Singaporeans to see a collapse in the price of the biggest asset they own, you are miserable.
And off the record, I don’t own a property yet. However, I don’t think it’s my god given right to own a house easily, and I believe in saving and working towards it. I’m not bitter I’m not in the property market (yet) and I’m certainly not going to blame immigrants and the govt for ensuring the retirement savings of 90% of Singaporeans are PROTECTED.
Good Lord, do you guys want to see a deflationary spiral like what happened in Japan, or a collapse in property prices like what happened in Southern California o Michigan? Would that make you REALLY HAPPY?
Bunch of morons some of you are.
To ID on Tue, 5th Jan 2010 1:48 pm,
Many thanks. At least you came up with some suggestions here, not like our highly paid MPs, Ministers, PM, SM, MM, etc, or even some of the forumers here who just merely wanted to vote for change (but what change?)
I like your idea about imposing “capital gains tax on all PRs and foreigners”… If I am not wrong, right now we only have a Stamp Duty which is payable by all buyers, Singaporean included, so maybe we can have another Stamp Duty for sellers who are not Singaporean only
“This includes if a couple is one citizen and one PR, than the PR portion gets tax too”
I know of many PRs who over-night change their mind to become citizen when the upgrading program is voted through for their flat, with their spouse still holding PR. So yes, your second suggestion should help to an extend as well
Piece of shit
@to fpc
to put things simplisticaly for the benefit of the less erudite
“morons” like you,to fpc.
must all things cost more at the same time?
look at the poor men’s wages eihter here or in america?
despite the RICH and POWERFUL getting richer,even smart “morons” among you guys want workers to compete with
hungry ‘communnists’ from China by chiding us and then taking away our jobs if we do not accept that “sgd 1000″?
HDB can keep new flats available only to citizens who are first time buyers at a specially affordable “subsidised” price and let the PRs compete with other richer people in the secondary markets.Afterall,is it not the main mission of HDB to
provide cheap affordable housing for lower-income citizens?
and,for those who are made redundant and wish to downgrade in order to “financially plan” for old age as the govt propose and the bankers keenly selling the idea?
let the rich people and gainfully well-paid PRs who are thinking of “milking” the past hardwork of natives PAY THEIR DUES by competing evenly with the right kind of buyers.
why must HDB keep pushing up prices for bona fide citizens who
are innocent by-standers in the midst of the GREED of all these PRs and some others?!!!
you hear me,”to fpc”?
LoL, @FPC your comments are true to heart and economics but damn blunt haha. I anticipate you’ll be lovingly flamed by many of the readers here who cannot take being called morons :p
I don’t believe people here want a collapse in prices.
However, won’t you agree it is fair to say that Singapore, paying millions for the world’s supposedly best ministers and think tanks would’ve better anticipated housing demand / supply issues, thus preventing this upsurge in the first place?
We are faulting the government for not anticipating the consequences of increasing the population drastically without mitigating the social costs involved. Left hand wanna double population, right hand didn’t know it had to take toilet paper to clean it’s ass until it’s too late.
If property prices had been growing at an annualized 3-4%, I think there will be no complaints from any quarter. The reality is that property prices here have simply doubled in 3 years whilst all else stagnated. That is a root reason for everyone’s anger, even from a home-owner like me who bought my home in 2004.
So what if I doubled the value of my flat – I’ll always need this roof over my head anyway. My children are the ones who are going to suffer if this spiral is not kept in check.
I really hope someone somewhere somehow can think of a solution to not bring us out of, but at least put some ease to the mess we’re in (and going to be in). With today’s property prices, NO ONE, not even PRs can afford homes soon.
Unfortunately, being a small city state, the property market here will always be subject to some sort of speculation. The same thing happens in Hong Kong.
This is something I read from the South China Morning Post (sorry you need to subscribe to it to get the full article. However I will email the full article to TR and see if they actually publish it)
===================================================
According to provisional data from the Ratings and Valuation Department, average monthly rents in October were HK$99.70 per square foot on Hong Kong Island compared with HK$71.90 per square foot in 1999. Average property prices on Hong Kong Island have increased from HK$4,097 per square foot in 1999 to HK$6,599 this year.
The current jobless rate of 5.1 per cent compares favourably with the 6.3 per cent in the same period in 1999, but a census and statistics survey shows that a waitress now earns around HK$8,140 a month – about HK$1,000 less than she did in 1999.
A population by-census conducted in 2001 showed median incomes rose to HK$10,000 from the HK$9,500 in the 1996 by-census, while median monthly household incomes rose to HK$18,705 from HK$17,500. But the latest by-census of 2006 showed median monthly incomes had remained the same, while median monthly household incomes decreased to HK$17,250.
=============================================
In Singapore, our median monthly incomes increased from S$3600 in 2000 to $4990 in 2007.
I fail to understand why you people heap praise upon HK all the time when their median household income has been stagnant for 10 years and their property price movements make ours look tame.
You blame cheap PRCs for taking away lower income jobs. You blame richer PRs for pushing up property prices. Lowly educated PRs cannot…. Educated and rich PRs also cannot….. Ang Mohs cannot….. What on EARTH do you guys want?
Instead of complaining non stop, do something about your lives? I have a very comfortable graduate job (as do most of my friends, I’m in my 20s) and we earn fairly decent money (though by no means as much as the bankers) but it’s still decent….. And we got to where we were by sheer hard work and determination.
Some PRC is not going to take my job away tomorrow, and I’ll make sure that I remain relevant to my company such that it minimises the chances of that happening. For that matter, the PRCs joining my firm want salaries that are equal or higher than what Singaporeans are getting. Which is a great thing, since they won’t depress my wages.
If you’re in a semi skilled job which anyone can do, the responsibility lies with you to make sure your skills are relevant to your employer, to enable you to command the wage that you desire.
So you guys want to make it as difficult as possible for PRs to come here. You want them to be singled out, pay higher taxes, pay capital gains tax etc etc etc etc. If that’s the case, why would ANYONE migrate here then? Do you think Singapore is so awesome that we can impose such draconian rules on them and make them feel totally unwelcome here? Even the US and Australia do not impose such harsh rules on PRs.
Most great cities and financial centres have a huge transient/foreign population. Look at New York, London, Paris, Chicago….. even Sydney….. what proportion of the residents of those cities are foreign born?
If you guys want to be insular and go the way of Japan….. then so be it. They’ve had a deflationary spiral for 2 decades, oh but wait, property there is now affordable, so it MUST be good right?
STI index :
year 1990: 1160.5
year 1999: 2437.48
year 2000: 1907.88
year 2009: 2791.01
Rate of return for (1990-1999) ~ 7.7%
Rate of return for (2000-2009) ~ 3.9%
The companies in Singapore are not performing as well as they had in the decade 1990-1999.
This is in spite of the tax cuts, cheap foreign labor and other industrial policies by Singapore govt.
LHL needs to do a lot of soul searching. his policies are not working. All he did was to construct buildings (one after another).
//To FPC
what you are doing is over a one year period (2000-2001). It resembles the bam job I was referring to i.e. one night stand. which is characteristic of this govt… opening taps whenever they feel like it. The economic effect is not persistent and is demonstrated over a 10 years period.
Broad economic strategy takes some time to manifest. That is why I use a 10 year period.
If you want, you could use a continuous 10 year window study.
You would reach the same conclusion.
the data is obtained from:
http://www.econstats.com/eqty/eqew_ap_17.htm
It is not concidental why I use 10 years period that start end 2000.
There was a economic talk some time in 1998-1999 and the implementation of those “strategies” happened later.
Over a 10 years period , we didn’t see any spectacular growth in return in spite of all the FTAs and tax cuts and massive importation of cheap labor etc.
I am not blaming Fts for the poor growth.
I am BLAMING EVERYthing the govt has done and the sequence of their actions, which is NOT producing any results.
We don’t have enough to retire.
our companies are not doing well.
all the more so, when we compare with other companies from HK and Taiwan (which had Chen Shui Pian that cocked up the show for 8 years) and south Korean (which I didn’t calculate by I took a glance and it suggest the same results).
Their policies are different from ours. In any case, their implementation is more effective.
More importantly, they didn’t have to pay their govt huge pay for non performance.
Why are we so backward to pay our govt excessively to stop them from being corrupt while they don’t come up with policies and implementations that produce results?
People have been saying the same things with GIC/TH returns.
If we look at other local companies alone, through the sTI index, I am saying we see the same thing.
If we look at the level on innovation that our companies have demonstrated in comparison with companies in the other 4 tigers, we reach the same conclusion.
Honestly, one party rule is the cause in all this.
We simply cannot expect, one party rule to produce the environment for innovation that drew its energies from our apparently well educated people to produce wealth.
We cannot even expect one party rule to distribute wealth appropriately. what is stopping them from hogging wealth for themselves?
If this is a utopic system, then we should see many countries copying it. The fact is we don’t. those countries never declared they copied our system and we should be making a lot of monies implementing those schemes for countries. that would show up somehow through increasing rate of return (because we are selling a manufactured good to a larger group of ‘customers’)
the fact remains: we don’t see any increasing rate of profitability.
//To fpc
As if PAP can stop property values in Singapore from collapsing.
Take a look at the property values in 2000-2006.
Yeo Chow Tong was betting on that and lost big.
what a joke.
//TO FPC
If I look up the value of the STI index in the last trading day in year 2001 (which is 1576.96) and use that to compute the Rate of return over a 9 year period to end of year 2009.
This give raise to 6.5% per annum over the period 2001 to 2009.
This is still lower than the rate of return over the LONGER period of time of 10 years from 1900 to 1999 (which is 7.7%) in SINGAPORE.
In addition, for HK:
end year 2001: 11397
end year 2009: 22279.58
Rate of return: 7.7%
Which is STILL much higher than the return of Singapore STI over the same period. (which you confirmed using your numbers)
//TO FPC
//The stats speak for themselves. The STI has vastly outperformed the Dow,FTSE and Australian Indices, and it kept pace with the Hang Seng. In S$ terms, you could even say that the Dow and FTSE would have DEPRECIATED, since the US$ has fallen from about $1.84 in 2001 to $1.40 today (25% drop) and the pound has fallen from S$3 to S$2.25 today (25% drop). Sure, the A$ may have risen by about 25% against the S$ in the past decade, but 48% gain in the ASX multiplied by 1.25 gives a gain of 60% in S$ terms. Sorry but that still underperforms the STI’s gain in S$ terms by 107%.
Thank you for confirming that to the locals of Hong Kong, their companies are overperforming our companies.
If the return in US, Australia companies are so bad like you calculated and ours are so good, I wonder why GIC is putting out so much monies in these countries’ companies?
Is it making monies? We all know the answer.
More importantly, if their company performance is so bad in comparision to ours, why are the govt copying their policies?
//TO FPC
//If you’re in a semi skilled job which anyone can do, the responsibility lies with you to make sure your skills are relevant to your employer, to enable you to command the wage that you desire.
We DON’T need you to tell us how to make more monies. I would say ALL Singaporeans (not in the public sector) know what they must count on themselves to make more monies.
There is no handouts in Singapore, not integration funds. Singaporeans ALL know that.
I wonder why you didn’t know.
Whatever it is: the economic policies of the government over the last decade is NOT working.
We don’t see good earnings growth in comparison with HK companies and other 4 tigers.
It is as simple as that.
//TO FPC
//To all you people out there who want a property price collapse in Singapore, and for 90% of your fellow Singaporeans to see a collapse in the price of the biggest asset they own, you are miserable.
NOBODY WANTS A PRICE COLLAPSE in Singapore.
WE JUST WANT PRICE STABLity. You mean we cannot have constant price over a decade? How did Lim Chin San did it in 1970-1989?
//In Singapore, our median monthly incomes increased from S$3600 in 2000 to $4990 in 2007.
This is WRONG.
IT was published that the median HOUSEHOLD income increase from (I think) 3000++ to 4000++.
This is not surprising because the number of persons in a household has INCREASED with more people having to stay with the relatives.
That’s why MBT wanted more Singaporeans to stay in a 3 room flat like say 7 to 8.
The average pay per person has decreased over the same period.
That is why YOUR LHL wanted Singapore to increase per capita income.
//To fpc
With regard to what you say about the Australians, you should be telling them to the prc PRs in Singapore or the PRC.
They are the ones who abandon ship from Singapore to Australia.
Somehow, they think Australia is still better than Singapore.
I wonder why?
Maybe the freedom given out by the Australian govt is still better than the goodies given out by Sing GOVT.
//TO FPC
//In Singapore, our median monthly incomes increased from S$3600 in 2000 to $4990 in 2007.
This is WRONG.
Median HOUSEHOLD income (according to the shitty times) was 3000++ in 2000 and 4000++ in 2009.
That comes from the INCREASED number of people staying together in a flat.
It comes as a no surprise as MBT wanted more Singaporeans to stay in a single flat like 7 to 8. To jack up this statistics.
Your LHL just show that the per capital income is not doing well because he just declared he wanted people to increase that contrary to what your numbers have suggested.
//TO FPC
//Most great cities and financial centres have a huge transient/foreign population. Look at New York, London, Paris, Chicago….. even Sydney….. what proportion of the residents of those cities are foreign born?
I know that maybe true for London, NY and Chicago.
That is because the people they attracted are good.
At least they didn’t need 10 million public fund to integrate.
I didn’t even want to add in the opportunity cost.
It is curious why the PRCs in Singapore wanted to emigrate to Australia if what you calculated is true.
//TO FPC
//if you guys want to be insular and go the way of Japan….. then so be it. They’ve had a deflationary spiral for 2 decades, oh but wait, property there is now affordable, so it MUST be good right?
I have never heard of a serious economist who thinks that immigration (at the scale of Singapore) will solve Japan’s economic problems.
Certainly, Paul Krugman never thought so as he never use immigration in any of his books that he thinks will solve Japanese macro-economic problem.
He won a Nobel Prize.
In fact, he thinks Japanese’s macro-economical policies failed Japan, not immigration.
Massive immigration is the opposite of insular? and the solution to deflation?
What a joke!
Japan didn’t need massive immigration because its companies have successfully outsource to their profit, inefficient operations overseas using local fts at local prices, while developing PROFITABLE business overseas.
Singapore based companies have by and large not being able to do that.
For anyone that you can suggest, I can name 2 that failed.
That’s why the companies need the fts to work in Singapore.
And they are not maintaining the bottomline but not increasing it despite the influx of immigrants.
Sing Govt has failed to create the environment for these companies to adopt modern hr practices that draw on the inventiveness of well educated Singaporeans to develop profitable business.
Instead, it is feeding these companies with cheap and lowly educated immigrants to sustain business.
sad state of affairs.
The STI index performance in comparison to the last decade and in comparison to the other 4 tigers are a demonstration of failed industrial policies.
If you want other indicators, I have some more to give.
//TO FPC
//So you guys want to make it as difficult as possible for PRs to come here. You want them to be singled out, pay higher taxes, pay capital gains tax etc etc etc etc. If that’s the case, why would ANYONE
migrate here then? Do you think Singapore is so awesome that we can impose such draconian rules on them and make them feel totally unwelcome here?
Thank you for acknowledging that Singapore under PAP is not an
attractive destination for even Singaporeans who are subjected to the rules/ban/taxes you mentioned above.
that’s why there is drive to get these free riders PRs to become Singaporeans much like there is a campaign to get Chinese people to speak Mandarin because Chinese people are using that language.
// Even the US and Australia do not impose such harsh rules on PRs.
These countries didn’t need to for at least 2 reasons:
1. they are attractive
2. their system of selection of immigration are effective in that it takes in immigrants who can integrate into their economy without public funding and locals find the immigrants attractive enough to want them.
We attract Chinese pimps and prostitutes by and large because there is a market of old lonely men here.
Even though they are enterprising, the new immigrants are still pimps and prostitutes.
We locals are not happy because (for one among other reasons) we need to spend 10 million to integrate them while locals know they don’t get any handouts.
The monies that get from the govt ALWAYS come with a price be it for increased GST or other sacrifices.
In addition, we are not champion complainers…. we pale in comparison with the hong kongers, Taiwanese or south Koreans.
When these people are unhappy, they march on the streets to protest.
We only complain in the coffee shops, internet and the TV until now.
I assure you, this immigration issue will be the last straw that broke the camel’s back for the pigs @ parliament.
BTW, there is an acknowledgment of under-employment in Singapore. Ask your boss in government what that means. The NTUC people knew about it.
We really don’t need to receive moral lessons from you and go revise your economics course!
I had wanted to say :
that’s why there is drive to get these free riders PRs to become Singaporeans much like there is a campaign to get Chinese people to speak Mandarin because few Chinese people are using that language at the initiation of the campaign.
//TO FPC
//Some PRC is not going to take my job away tomorrow, and I’ll make sure that I remain relevant to my company such that it minimises the chances of that happening. For that matter, the PRCs joining my firm want salaries that are equal or higher than what Singaporeans are getting. Which is a great thing, since they won’t depress my wages.
if this is happening, we won’t be seeing a depression of per capital income since 2006.
Please be honest.
//TO FPC
//For that matter, the PRCs joining my firm want salaries that are equal or higher than what Singaporeans are getting. Which is a great thing, since they won’t depress my wages.
Where have the majority of the PRC been employed? at the massage parlour. how much do you think they make there?
Their salaries are not lower, why employ them? what makes you think they are more qualified/productive than you?
there are loads of chinese unemployed in china and yet their finance industry came down to singapore to look for people here. how is that?
to imply that Sin
letting prs bid for resale flats achieve many objectives:
1. it allows the land prices to be bid higher and govt take advantage of that,
2. it allows the hdb property tax to get higher,
3. it allows the Singaporeans (new buyer) to carry a higher loan for the same flat build years ago. resulting in singaporeans having much less monies to take out from the CPF.
4. it allows the government to eventually moderate the growth rate of the minimum sum, resulting in fewer Singaporeans getting their monies out of CPF, without them looking too bad. this is only true if they don’t cock up the GIC/TH investments again.
5. It allows the PR to think that they get a good deal, which helps Singapore to get more cheap labour from mainland.
6. those who sold, cannot afford to buy (at least some) and will have to stay with relatives. That will drive per household income because whether you have 3 working person contributing to a household or 5 working person contributing to a household, household is the sum of the contributions and evidently, we should expect 5 person contributing with their jobs should be more than 3 person contributing with their salary.
that’s why only the govt is pushing for higher and higher property prices not Singaporeans. Most of us want price stability much like the same thing we want from the price of food.