What happens when your HDB flat becomes 34 years old?

A few years ago – the Government announced a new property cooling measure for HDB flats.

But arguably, most people did not pay much attention to it, or realised the implications.

The link to the joint press release by the three Ministries – “Additional Measures to Ensure a Stable and Sustainable Property Market” is HERE.

HDB less than 60 years lease

The terms for granting HDB loans and the use of CPF funds for the purchase of HDB flats with remaining leases of less than 60 years – will be tightened  (details of this measure are in Annex IV).

Asset enhancement

As more HDB flats age from the time that they were built, those who have subscribed to the “asset enhancement” policy which arguably lead to the increase in HDB prices, may find it harder now to monetise their flats to retire – with this new cooling measure.

Implications for lower-income

This may especially affect lower-income Singaporeans who purchased 2 and 3-room flats and may lack the financial ability and savvy to change to a second new Build-to-order (BTO) flat or  resale flat with a new or longer lease balance, in order to avoid the problems that may arise from this new cooling measure.

Now, with this new cooling measure, if your flat is not selected for the Selective En-bloc Re-development Scheme (SERS), it may become harder to sell – as flats age beyond 34 years.

With the Minimum Occupation Period (MOP) of five years, very few people may want to buy flats with a lease balance of 65 years (more than 34 years old).

Less CPF can be used

To illustrate this problem, for example, if a 30 year-old couple buys a flat with a lease balance of 59 years, their prorated Valuation Limit (for the use of CPF), will be only 58 instead of 100 per cent of the valuation at the time of purchase.

The 58 per cent is calculated (34 divided by 59 years) “based on the ratio of the remaining lease when the youngest buyer who can use CPF turns 55 years old, to the lease at point of purchase”

This means that they will no longer be able to use their CPF to pay once the use of CPF hits 58 per cent of the valuation. From this point onwards, only cash can be used to pay for the mortgage.

Can’t use CPF

For flats with a lease balance of less than 30 years, use of CPF is not allowed at all.

HDB loan restrictions

There are also restrictions on getting a HDB loan – “Lease balance  of 30 – 59 years – “Allowed, if remaining lease can cover the buyer* to the age of at least 80. Loan tenure will be the shortest of: 30 years; 65 years minus average age of buyers; and balance lease at the point of purchase minus 20 years.”

Lease balance of 20 – 29 years – “Allowed, if remaining lease can cover the buyer* up to the age of at least 80. Loan tenure will be the shortest of: 30 years; 65 minus average age of buyers; and balance lease at the point of purchase minus 20 years.”

Lease balance of less than 20 years – “No HDB housing loan.”

Over 40 years’ old flats

So, in view of the economic implications of this cooling measure, this policy change in my view may be reviewed in the future – when the HDB market has stabilised – as it may make less sense to cool the property market for this segment of very old HDB flats, which as I understand it may form a small proportion of the total number of HDB flats now.

How many such transactions?

By the way, how many ‘over 40 years old’ flats’ transactions are there in a year?

Higher MSR for HDB loans?

If there is a need to cool the public housing market further in the future, we could also reduce the Mortgage Servicing Ratio (MSR) for HDB loans from 35 to 30 per cent, to be the same as private property and HDB bank loans.

 

Leong Sze Hian

 

 

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28 Responses to “What happens when your HDB flat becomes 34 years old?”

  • Rabble-rouser:

    A simple answer with a simple solution to the problem. All it require is a Yes or No answer!
    Gather an En bloc of HDB voters & go confront your GRO or meet the MP/Minister at the meet-the-MP session just before 2020 GE & ask, “Will you resolve the matter of HDB leases?” Just a Yes or No answer is sufficient – if Yes, we’ll vote for you but put it in writing (through the Media) so that we can either sue you or bring to International Arbitration if you default; if No, we vote for Opposition En Bloc!
    Watch how many Ministers would ‘jump’ to preserve their high paying jobs. They don’t want to be the next George Yeo or Lim Hwee Hua who were put out to early pasture after they had lost the Aljunied GRC to WP.
    Good idea? – Yes or No answer, please!
    p.s. The power is in your hands in 2 years time ie. 2020 GE. If you don’t act, the stupidity is yours to bear, not the PAP! Time to give them gastric ulcers; if not, the gastric ulcer is yours to bear! Tio Boh?
    Or else, the voters get the govt they deserved!

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  • oxygen:

    THE ASSET ENHANCEMENT SCAM is going to “kill” most of the 70% peasants TOO STUPID to discover they are STUPID TO IMPOSSIBILITY.

    It takes a long time for BTOs to rise in value to form the basis of financial support to upgrade to private condos.

    Without this upgrading support beneath, the private surburban condo market practically “crash” or simply wait for the passage of time to crash in value. EC buyers basically also go duped by PAPpys cunning 1% truth, 99% lies, fantasy and propaganda.

    The upper canopy of private condo have already cratered. Me see the LEE-jiapore property market bubble is beginning to crash down like a building collapsed.

    PAPpys have finally come to the correct conclusion that asset bubble airbag economy is UNSUSTAINABLE FICTION. And PAPpys MPs all DIAM DIAM DIAM.

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  • NotMyProblem:

    Whatever the government’s scheme and measure, the citizen is the one ends up with the short end of the stick. It sounds nice in words but once it was implemented, citizen will find it at their disadvantage.

    That’s the reason we have scholars in government services to think of scheme and regulation to milk the citizen. These scholars forgotten they used taxpayers’ money for their study, now they use what they’ve learnt to screw the taxpayers.

    All these scholars think PAP paid their tuition fee, now they repay the PAP!!!

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  • Bapak:

    This HDB Asset Enhancement Scheme means you pay with your hard earned money to the tune of hundred-of-few-thousands will become zero FOR RENTING THE FLAT TO YOU!

    On top of that you still have to pay for the electricity, water (with tax over tax), toilet-bowl (by the number, mind you), throwing your rubbish yourselves and parking your car. Stupid!

    You rent a hotel room one price everything included.

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  • opposition dude:

    The PAP hasn’t announced any changes as of now to flats which are older than 40 years old so let’s wait for a policy tweak as they so love to call it.

    Since PAP loves to plan long term then I’m sure that whatever changes they have in store will also take into account flats that will also approach 40 years as time goes by. Maybe the HDB loan restriction would be raised to a flat which is 75 years old who knows.

    But ultimately it’s the combination of a policy and how the market responds to it. No one wants their flat value to plummet when it reaches a certain age and it also seems like there won’t be much space left to build replacement flats too. So for now it’s a double whammy.

    A good gauge of how old flat prices are holding would be the resale values of all those flats built in the 60s and 70s. Have their values dropped since Lawrence made that now infamous statement? Does anyone have some data on these flats?

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  • We ask for it:

    Singaporeans are obsessed with their properties, be it a HDB flat or private property, because for most of us, it is our biggest asset. Most Singaporeans want their property price to be high and continue going up even if they can afford to own only one property, the one they are living in – the feel good factor, a topic to talk about.
    PAP understands that and for that, is able to control the people. PAP makes property prices expensive – limit land sale, so property developers bid aggressively at high price for government land, who then sell the new condo at record price; because of high land price, HDB will price the flat at market price less some subsidies and maybe a bit grand to some; overall the government collect more money this way than if the land price is low and no subsidies are given out.
    The developers dare to bid aggressively for government land because they know PAP will not let property prices fall – PAP has done that -stopping land sales, allowing developers to extend the periods to complete building and selling of completed units in the recent financial crisis and the Asian crisis, such that developers and the rich will hoard properties until demand picks up through import of even more foreigners.
    Many Singaporeans borrow up to their eye balls to own a flat, upgrade to a bigger flat, upgrade to a private property, buy a second property, a third one. As a result, they have to literally work until they drop dead, to pay off the loan. It serves PAP purpose because the people will be busy working, have no time to think, think over like what PAP has done to us, or get involved in social activities and politics.
    To sustain property demand and prices, PAP has to import huge number of foreigners, the flip side is Singaporeans are being displaced by these foreigners. Many Singaporeans are not only losing jobs to the foreigners, but also their houses.
    More people will be displaced even before we reach the “target” population of 6.9 million.
    I wonder what tricks PAP has up in their sleeve if they are still in power.

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  • Amos exposed PAP hypocrisy:

    Prices of HDB flats more than doubled since LHL became PM while local wages were stagnant. Where was the property cooling measures then? Like the Asset Enhancement Scheme the property cooling measure is just more bullshit. As Amos proved in US Court TWICE, PAP is just a bunch of HYPOCRITES.

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  • rukidding:

    I bet all those PAPmps will try or avoid “tackling or answering” any issues related to use of cpf and loans that relates to less than 65 year lease flats ,

    This is not “fake news”…..but I believe None of the Mps would like to “highlight” those ” un[easant clause and rules”….do they ??

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  • LIONS:

    Irresponsible gahmen implement irresponsible policies that will cause the common citizens to suffer hardships through time.

    Leadership is not about arrogamce or self-promoting but about taking care of the ppl who place their trust on us.
    Self-serving ppl can never make good leaders.World history shows it.
    Even our own 50 yrs modern Sg history has shown how good n caring leaders think for n of the PEOPLE FIRST.

    Those who are self-serving know full well who themselves are n should not continue to cause harm to the ppl who trust them.

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  • LIONS:

    Pls dont continue to fiack the poor till they really drop dead?!

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  • HarderTruths:

    Hahahaha the righteous 70% are getting their karma back.
    Think pappies going to help them?

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  • oxygen:

    OBVIOUSLY THE ASSET ENHANCEMENT POLITICS/SCAM bundling the housing loan/CPF-funded purchase is LEE-jiapore’s SUB-PRIME HOUSING NIGHTMARE.

    Without a major CPF component, banks would not lend the balance of the loan. And without the CPF, the borrower (buyer of property) cannot find the seed risks capital to give lender the comfort risk margin.

    Now that PMET jobs are unstable and income (even if stable) are not growing, the lender if facing bigger risks and that “lender” living in fear in this housing bank loan/CPF nexus INCLUDE the buyer’s own CPF retirement saving.

    The LOGICAL OUTCOME must soon – be restriction on CPF that could be used to fund all purchase property including private condo market i.e. perhaps the first 15% must be cash, not CPF funding.

    And when that restriction comes comes into play, private condo market will collapse. The crazy demand for property speculation will simply evaporates overnight. Anyone unable to hold on to an existing underwater mortgage desperately looking for a buyer won’t find any – even with steep discount pricing.

    Anecdotal evidence of retirees seeking to downgrade and unable to find buyers for the 30 plus old flats after booking for the HDB’s studio 2-rm flexi must be sending alarm bells in PAPpys. HDB is, of course, TALKING UP OPTIMISM that the elderly love their studio 2 rm flexi ON SHORT LEASE TERM BUT SILENT THAT BUYERS OF THESE SHORT-TERM LEASE are incapable of financial settlement as they can’t sell their existing bigger accommodation.

    HDB as a public service institution IS NOW THE POLITICAL TALKING COW – speaking the mouthpiece of PAPpys instead of letting PAPpys do the talking. HDB is now publicly urging those trapped to price their older flat according to the number of years of unexpired lease. It is the PAPpy usual ploy of 1% truth, 99% lies, fantasy and propaganda, I am convinced.

    The economy is disintegrating.Industries got wiped out. Automation is destroying jobs and FT displacing Sinkies and new FT arrivals (unless they are cash rich) will struggle to finance housing purchase. Conditions are ripe for a collapse of the housing market.

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  • Python 5:

    oxygen,

    its whether this crash will come full swing full circle
    before the next GE.

    first we see ppl sleeping at east coast park/ changi beach.
    then we see ppl sleeping at HDB void decks, corridors, staircase landings.
    already we are seeing ppl sleeping in their grab cars.

    oxygen:
    THE ASSET ENHANCEMENT SCAM is going to “kill” most of the 70% peasants TOO STUPID to discover they are STUPID TO IMPOSSIBILITY.

    It takes a long time for BTOs to rise in value to form the basis of financial support to upgrade to private condos.

    Without this upgrading support beneath, the private surburban condo market practically “crash” or simply wait for the passage of time to crash in value. EC buyers basically also go duped by PAPpys cunning 1% truth, 99% lies, fantasy and propaganda.

    The upper canopy of private condo have already cratered. Me see the LEE-jiapore property market bubble is beginning to crash down like a building collapsed.

    PAPpys have finally come to the correct conclusion that asset bubble airbag economy is UNSUSTAINABLE FICTION. And PAPpys MPs all DIAM DIAM DIAM.

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  • Lee Bow Tan Malboro:

    The fact that use of cpf is restricted for old flats speaks volumes.

    They need to come clean with the people.

    Sadly, most are used to trusting them fully and unquestioningly.

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  • oxygen:

    @ Lee Bow Tan Malboro

    PROPERTY-INFATUATED PAPpys-worshipping 70% daft Sinkie peasants are TOO STUPID TO EVEN BEGIN TO DISCOVER THEY ARE STUPID TO IMPOSSIBILITY. They are so gullibly naive to think that stacking up brick-and-mortar with a SUB-PRIME BALANCE SHEET – a PAPpy’s asset enhancement scam invention – will make them rich instead of trapped in life-time poverty struggle of living hand to mouth for most. But the world is FAIR – adult stupid people always pays dearly for their foolish STUPIDITY and most can’t be even educated to the senses – worst than little naughty children.

    Lee Bow Tan Malboro: The fact that use of cpf is restricted for old flats speaks volumes.

    They need to come clean with the people.

    Sadly, most are used to trusting them fully and unquestioningly.

    It is a life-time of CAWKED STUPIDITY trusting s*ake oil salesmen and saleswomen cunning of telling such dumbfarked peasants 1% truth, 99% lies, fantasy and propaganda. Brevity hides the devil of the details of deception.

    These 70% peasants believes in the fiction of “from fishing village” to the first world artificial beauty when in that fantasy journey – all these is happening behind the scam of asset enhancement politics scam of estate upgrading.

    - PAPpys acquired land for the price of a song and dance in Karaoke lounge, priced them at market rate, packaged it into inflated public housing prices (secretly transfer the price peasants paid to the Singapore Land Authority BUT THE LEASING CONTRACT SILENT ON LAND OWNERSHIP PAID FOR BY PEASANTS)

    - then tells peasants your public housing prices gone up a lot, feel very rich ,if your kids can’t afford it because banks won’t lend so much, you can buy our SUB-PRIME CREDIT FINANCE SCHEME – YOU CAN BORROW THE USE OF CPF AND PAY US INTEREST (never forget to tell all that CPF is NOT our money), and when you sells it, money goes back to CPF in our LOCK-UP SAFE VAULT where we pay you only 2.5% return when the investment therein could earn 6% return.

    - a bigger prize await you of “second bite at the cherry” – there is CAPITAL GAIN TAX RESERVED FOR PEASANTS EXCLUSIVELY – the HDB resale levy.

    - If you can sell your old flat, HDB give you POLITICAL ADVICE WHICH POLITICIANS WON’T SPEAK (because it is bad for vote enticement later), that is sell your old HDB according to lease remaining!!! How clever of HDB fiacking dumb peasants.

    - and if that still does not work, confiscate your deposit for the 2-rm flexi.

    WHICH BUSINESS OF PUBLIC HOUSING SUBSIDY IS HDB GIVING PEASANTS??

    I AM BLIND -CANNOT SEE CLEARLY!

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  • promotion of enhancement:

    //THE ASSET ENHANCEMENT SCAM is going to “kill” most of the 70% peasants TOO STUPID to discover they are STUPID TO IMPOSSIBILITY.//

    aiyoh, promotion of enhancement hor was to create atmosphere for the white idiots to rent-seek lar on new public housing + their erection scoring lar. just like many upgrading stories. and this (plus many rent seeking approaches) will only make sinkie land expensive (inflationary effect) and tough on daft sinkies (pay demand) + businesses (high cost).

    after that is done, another group of white idiots will now sing song to make daft sinkies lower their expectation and not to expect too much on those units with shorter lease lor.

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  • Rabble-rouser:

    The biggest problem for HDB housing market going forward is the entire market liquidity freezing up & a looming HDB oversupply crunching property market values because people can’t transact their properties due to;
    * lack of a buying pool for ageing HDB properties (no thanks to lease drop-off);
    * downgrading process is frustrated because ageing HDB sellers can’t sell their existing ageing HDB flats at any price & new 2-rm HDB Flexi demand (for Short-lease flats) falls off creating excess HDB newbuilding oversupply;
    * If ageing HDB flat prices drops to new lows, then newer HDB flat prices & valuation are pulled downwards along with older flat values & from declining bank valuation (which is based on statistical info using historical transacted price);
    * recent HDB buyers thinking of using their property price appreciation to upgrade to private property are in for a shock when demand for HDB flats collapse due to bank downward valuation process;
    * misalignment between people’s upgrading expectations & a rapidly deflating HDB property market affecting private housing demand & provoking an oversupply glut of completed units;
    * Private property valuation faces a mismatch between market price collapse & existing mortgage values – a huge negative equity looming for mortgage holders;
    * Lending banks ask mortgage holders to ‘top-up’ the difference. Those who can’t are forced to liquidate or simply have their property foreclosed by the bank. Property investors [buy-to-rent] lose their pants;
    * Developers who bought high priced En Bloc properties are also facing financial difficulties from their banks as property market crash to new lows. Some may even go bust;
    * The afflictions from the housing market spreads to other property sectors. REITs vehicles face cash flow problems from ghost malls (growing vacancies) as consumption & spending collapsed.
    And 3 external factors are coming together (like a Perfect Storm);
    * Global Interest rates are rising rapidly;
    * A trade war looming wreaking havoc on open economies like S’pore; &
    * Risk of a Global war which will crush investors’ confidence leading to terrible collapse of asset values.
    In addition, the ongoing global business & technological disruptions destroying jobs & reducing job numbers as automation & technology reduce manpower needs.
    All these are not made up but are from years of real speculation experience & this forecast was made from the experiences investing in S’pore’s property market. The stability & 1-way capital appreciation path in S’pore properties is over! There are no foundation stones to grow the next stage of growth.

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  • oxygen:

    @ Rabble-rouser

    YOUR ANALYSIS ABOVE and my informed sources are always BEAUTIFULLY INFORMED AND RELIABLE. My sources tell me this STAGGERING FACT – there is NO FLURRY of real estate snail mail drop in their mail-boxes of property bargain and drama of new launches in the LAST SIX MONTHS DESPITE THE ROWDY SHOWBIZ of f*rting frenzy of en bloc sales going on.

    Their conclusions are these – disputable for those who disagree – as follows.

    - the secondary market is dead as a mousey corpse

    - foreigners are buyers of the new launching, locals are mainly out of the chase

    - the en bloc new launching might turned up in a SURPRISE BIG BLACK HOLE OF EMPTINESS OF DEMAND

    - most beneficiaries of en bloc are DOWNGRADING than upgrading, they know the end of the property market craze has already reach its crest never to return.

    My own observations are these

    - the 30 year bond market of falling interest rate is over.

    - even high-net worth savvy investors know the trend from this point is ONE-WAY, UPWARD DIRECTION of interest rate

    - MAS has tightened our money supply yesterday, the first time in 6 years and with shrinkage in credit financing, the demand on leveraged borrowing will meet with rising costs and slower investment demand (falling prices)

    - even corporate bonds -usually bought by high net worth savvy investors – are OUT OF FASHION, would be buyers are deserting in droves.

    https://www.cnbc.com/2018/04/09/bond-deals-in-asia-are-getting-hit-because-of-rising-interest-rates.html

    THOSE WHO BOUGHT PROPERTY IN THE LAST FEW MONTHS ARE ALL RUSHING INTO THE ABATTOIR – THE LAST OF STUPID SHEEP WAITING FOR THE SLAUGHTER – all because of FOMO (fear of missing out) – UNLESS THEY ARE CASH RICH OR FOREIGNERS OUT OF TOUCH WITH LOCAL REALITIES.

    The natives who rushed in to buy in recent months are BLIND OF GREED STUPIDITY – they didn’t even noticed that there is no snail mail in their mail box seeking buyers for new launching IF PROPERTY MARKET IS REALLY THAT SIZZLING HOT. Real estate agents know that it is as cool as a morgue filled with corpses to be buried or cremated.

    The en bloc craze pricing is high risk bet – BASED SOLELY ON RISING LAND COSTS – not demand and affordability. Developers are betting the Trump economy turnaround. After 10 years of economic growth in US, all due to cheap money now disappearing, that party funded out of debt leverage is over. Central banks rule, not Trump nor Merkel nor XiJinPing nor Theresa May, the global economy BECAUSE THE WORLD IS FLOODED WITH TOO MUCH DEBT AND YOU CAN’T BUILD WEALTH ON A MORGUE OF ESCALATING DEBT.

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  • oxygen:

    @ Promotion of enhancement

    VERY CLEVER and precise of your analysis. I drink to that!

    promotion of enhancement: aiyoh, promotion of enhancement hor was to create atmosphere for the white idiots to rent-seek lar on new public housing + their erection scoring lar. just like many upgrading stories. and this (plus many rent seeking approaches) will only make sinkie land expensive (inflationary effect) and tough on daft sinkies (pay demand) + businesses (high cost).

    after that is done, another group of white idiots will now sing song to make daft sinkies lower their expectation and not to expect too much on those units with shorter lease lor.

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  • a PG:

    It will become a real nightmare for all flat owners when their leases will become shorter and shorter towards the 99 years. Fewer buyers of resale flats but more sellers by then, including private flats of 99-year leases, too. Is the present gablemen aware of the future situations and start doing something now. Remember the early years of STOP AT TWO family policy that give rise to many economic and social problems.

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  • Haigen-diaz:

    @ Oxygen

    A “home” is where you live, and should never be considered an investment. A “house” is an investment, to be used for whatever financial purpose required to achieve a return. Simple stuff – should be taught in schools for the 70%… The major problem with this “thought experiment” is that no one actually owns their own home or land. The banks do. Right up until you make your last payment. In fact, the only time one “owns” one’s land is that brief moment just after you’ve successfully sold it to someone else and just before you move to your next abode. 1. Speculative bubbles are not caused by a perceived scarcity, but by exactly the opposite: a false belief in never-ending high returns.

    oxygen:
    THE ASSET ENHANCEMENT SCAM is going to “kill” most of the 70% peasants TOO STUPID to discover they are STUPID TO IMPOSSIBILITY.

    It takes a long time for BTOs to rise in value to form the basis of financial support to upgrade to private condos.

    Without this upgrading support beneath, the private surburban condo market practically “crash” or simply wait for the passage of time to crash in value. EC buyers basically also go duped by PAPpys cunning 1% truth, 99% lies, fantasy and propaganda.

    The upper canopy of private condo have already cratered. Me see the LEE-jiapore property market bubble is beginning to crash down like a building collapsed.

    PAPpys have finally come to the correct conclusion that asset bubble airbag economy is UNSUSTAINABLE FICTION. And PAPpys MPs all DIAM DIAM DIAM.

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  • Rabble-rouser:

    @ oxygen:
    Absolutely correct! There must be some price appreciation (of resale HDB flats) coupled with price inflation for new HDB flats for the ASSET ENHANCEMENT SCAM to work. But with the marginalisation of the local PMEs & most importantly, the rapid price destruction from lease drop-off issue first enunciated by Minister Lawrence Wong – it had caused a seismic shift in the HDB resale market. Older HDB flats now have problems of selling as the buying pool had receded or potential buyers simply baulked on the ageing issue. The PAP had shot themselves in the foot politically! And masses of ageing flat owners are entrapped with their unrealisable asset losing value rapidly as it ages.
    The collapse of the resale HDB ‘premium’ ie. asset price appreciation will undermine the upgrading instinct & wipe out the upgrading support for private suburban condos in outlying areas.
    There is a clear divergence between the stark reality & the various developers/En Bloc buyers of land in seeing the future for property. I see a Moral Hazard issue developing as developers/En Bloc buyers are confident that the PAP govt will provide the underlying support for the S’pore property market through market intervention & govt actions. But the value destruction for S’pore property can’t be manipulated (& deflated slowly) because the pricing bubble had growth too big (debt bubble) & too dangerous (overarched values). Anyone with multiple properties holdings or even a single-family property under mortgage is in trouble. Plus banks who are overextended in housing loans will have loads of NPLs & disposal problems.

    oxygen: THE ASSET ENHANCEMENT SCAM is going to “kill” most of the 70% peasants TOO STUPID to discover they are STUPID TO IMPOSSIBILITY.

    It takes a long time for BTOs to rise in value to form the basis of financial support to upgrade to private condos.

    Without this upgrading support beneath, the private surburban condo market practically “crash” or simply wait for the passage of time to crash in value. EC buyers basically also go duped by PAPpys cunning 1% truth, 99% lies, fantasy and propaganda.

    The upper canopy of private condo have already cratered. Me see the LEE-jiapore property market bubble is beginning to crash down like a building collapsed.

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  • Losing hope!:

    For all their scholars and brains collecting millions and all their “never can go wrong” stance, apparently many pillars are now showing signs of cracking and collapsing. Where are their futurologists with their forward thinking plans. Or are we heading towards the edge of a cliff?

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  • to downplay another wayang:

    //For all their scholars and brains collecting millions and all their “never can go wrong” stance,//

    in a shameless self-declaration that ownself-check-ownself one-party system is good, don not expect those top scholars and brains are really working hard to favor the average daft sinkies – more like looking at their own white idiotic interests and thinking how to invent the next wayang to downplay another wayang.

    when a nation has a system where 4 = 5 and selected = elected, you know that the rot is very bad where the plp white idiots and 151th media standard are trying hard to mask the smell with cheap perfume.

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  • oxygen:

    @ Haigen-diaz

    YES, EVEN A “HOUSE” of your analytical description is NOT an investment but a gamble in debt.

    Haigen-diaz: A “home” is where you live, and should never be considered an investment. A “house” is an investment, to be used for whatever financial purpose required to achieve a return. Simple stuff – should be taught in schools for the 70%… The major problem with this “thought experiment” is that no one actually owns their own home or land. The banks do. Right up until you make your last payment. In fact, the only time one “owns” one’s land is that brief moment just after you’ve successfully sold it to someone else and just before you move to your next abode. 1. Speculative bubbles are not caused by a perceived scarcity, but by exactly the opposite: a false belief in never-ending high returns.

    One Ah Tiong old man told me this – IF YOUR LIFE IS BLESSED, you will die on the bed you usually sleeps on. If misfortune hits, you die anonymously or somewhere else, so you don’t need to buy another “HOUSE” beyond your “home”.

    On reflection, he was right. An risks undertaking in “HOUSE” purchase is NOT an investment. Why? Like you said, it is own by the Bank until you briefly sold it to another buyer (and you redeem your bank borrowings thereafter presumably). More people who own “HOUSE” actually made their money elsewhere and bet it on property INSTEAD OF MAKING MONEY IN PROPERTY PURCHASE to finance a more luxurious lifestyle or finance a business enterprise.

    Buying a HOUSE (so-called INVESTMENT) is, in reality of substance, undertaking a CURRENT CONSUMPTION BINGE of bank borrowings. If financed out of CPF, it is worst risk – it is CURRENT CONSUMPTION BINGE not on current borrowings of just banking credit, but relying on FUTURE RETIREMENT INCOME stream. It is SUB-PRIME BALANCE SHEET BET of risks undertaking in spending on future income not visible of current reach and for which THERE IS NO PERIODIC INCOME to fund that brick-and-mortar gambling. The yield on such undertaking is way below the actual borrowing costs of bank credit and worst taking into account opportunity costs implied of CPF financing.

    It is mostly non-income generating BUT DEBT CONSUMPTION overloaded. How to be rich living beyond financial means? Who is going to engage in business enterprise if money is so easily make in property without any work at all? Without business, where is the business and employment income to pay off all the bank borrowings in the economy?

    PROPERTY MAD IDIOTS DESERVED TO GET TRAPPED INTO UNDERWATER MORTGAGE gambling.

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  • Python 5:

    Rabble, this is a complete living nightmare scenario.
    and its getting very fkkking realistic and imminent.

    look at your post again. from 2room BTO to condos all not spared.

    Rabble-rouser:
    The biggest problem for HDB housing market going forward is the entire market liquidity freezing up & a looming HDB oversupply crunching property market values because people can’t transact their properties due to;……

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  • oxygen:

    @ Haigen-diaz

    THE PROPERTY-MAD PAPpys supporters ARE WELL AND TRULY a stupid greedy lot – I really think this mob is stupid to impossibility. That is the reason why this mob got so easily seduced by PAPpys asset enhancement politic scam. Their f*rtheads thinks like this – buy property, vote PAPpys and it is stairway to Heaven. To those with such mousey rat thinking having lost their hard-earned money, I say to them, you deserves your stupidity’s fair reward. And for the rest of this lot, I say wait for the next downturn in GFC, you will be stripped naked too of all your equity too, mostly justifiably.

    WHERE ON EARTH IS THERE ANY MONEY TO BE EARNED WITHOUT RISKS UNDERTAKING AND A LOT OF HARD WORK as if life is so simple in a globally competitive world of innovation and enterprise of the highest order?

    The asset enhancement politics scam IS SCREWED UP MINDSET that did a lot of permanent brain damage – not just of gullible young naive voters but of generations to come poisoned by parental foolish indoctrination that money is found hidden awaiting to be unlocked out of brick-and-mortar.

    And what is the REALITY in the world outside this greed-damaged stupidity that is really too stupid to even begin to discover they are stupid to impossibility?

    Here is some home truth from a BILLIONARE Japanese real estate developer – he WAS STRIPPED NAKED in Singapore and then recently in New York.

    A billionaire real estate developer have no acuity and financial prowess of property investing??

    Read on!!!

    St Regis Penthouse Sold At Record $15.8 Million Loss

    https://www.propertyguru.com.sg/property-management-news/2015/3/87946/st-regis-penthouse-sold-at-record-15-8-million-los

    and he got screwed again.

    Japanese Billionaire Slashes Price of Condos at Trump High-Rise

    https://www.mansionglobal.com/articles/79816-japanese-billionaire-slashes-price-of-condos-at-trump-high-rise

    Katsumi Tada, made his billions in real estate selling to suckers who bought his development. He himself was a sucker twice over buying over someone’s else development.

    Money don’t grow on trees. IT ALSO DOES NOT GROW ON BRICK AND MORTAR.

    Only dumdfarked 70% peasants – a lot more stupid than Katsumi Tada – are so easily duped by the asset enhancement greed-bait-and-switch dirty politics of a scam which defied rational economic thinking.

    They all deserves their just desserts. Don’t feel sorry for them.

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  • Python 5:

    Rabble, this is really fkkking hong-kan!!!!
    Countless will fkkking burn and die.

    1)now the collapse of aging HDB flats’ prices.
    2)glut of 2room BTOs for retirees.
    3)condos on mortgage loans.
    4)sibor rates rising not being factored yet.
    5)imminent NPLs and excessive repo’ed and unsold stocks held by banks.

    Rabble-rouser: Absolutely correct! There must be some price appreciation (of resale HDB flats) coupled with price inflation for new HDB flats for the ASSET ENHANCEMENT SCAM to work. But with the marginalisation of the local PMEs & most importantly, the rapid price destruction from lease drop-off issue first enunciated by Minister Lawrence Wong – it had caused a seismic shift in the HDB resale market. Older HDB flats now have problems of selling as the buying pool had receded or potential buyers simply baulked on the ageing issue. The PAP had shot themselves in the foot politically! And masses of ageing flat owners are entrapped with their unrealisable asset losing value rapidly as it ages.

    The collapse of the resale HDB ‘premium’ ie. asset price appreciation will undermine the upgrading instinct & wipe out the upgrading support for private suburban condos in outlying areas.

    There is a clear divergence between the stark reality & the various developers/En Bloc buyers of land in seeing the future for property. I see a Moral Hazard issue developing as developers/En Bloc buyers are confident that the PAP govt will provide the underlying support for the S’pore property market through market intervention & govt actions. But the value destruction for S’pore property can’t be manipulated (& deflated slowly) because the pricing bubble had growth too big (debt bubble) & too dangerous (overarched values). Anyone with multiple properties holdings or even a single-family property under mortgage is in trouble. Plus banks who are overextended in housing loans will have loads of NPLs & disposal problems.

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