Mah's measures fail to cool property prices, set to increase 22% by end 2010

[SNAblog]

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http://www.propertywire.com/news/asia/singapore-prices-still-rising-201004264076.html

Property prices keep rising in Singapore and now set to see a 22% increase by end of 2010

Monday, 26 April 2010

Private residential property prices in Singapore are continuing to rise despite recent real estate cooling measures, the latest figures show. Residential properties prices increased to 175 points for the first quarter of this year, around 5.6% higher than the previous quarter, according to the statistics released by the Urban Redevelopment Authority (URA).

This comes on top of a 7.4% increase in the final quarter of 2009 which was judged by analysts to be too high and unsustainable and resulted in a number of measures to try to cool the market amid fears of overheating.

Although the price increases for the first three months of 2010 are showing signs of slowing fears about a real estate bubble persist. ‘Although the price increase has dropped to 5.6% this first quarter, it is still of the higher range’, said Nicholas Mak, real estate lecturer at Ngee Ann Polytechnic.

He said that if this trend continued, by the end of the year the market could have seen a 22% jump in private home prices, reaching the peak level of 2008.

Real estate agency ERA Asia Pacific said the market’s bullishness could be attributed to the opening of the two integrated resorts, as well as the Youth Olympic Games to be held in Singapore.

Singapore is becoming increasingly visible among international investors and high net worth individuals, said Eugene Lim, associate director of ERA Asia Pacific.

According to the URA index, prices of private homes on the city fringe during the first quarter rose the highest, by 7.9%. Prices in the city climbed 4.4%, while those in suburban areas rose 4.3%.

Rentals of private residential properties also increased 4.7% and the index also shows that a total of 4,372 uncompleted private residential units were launched for sale by developers in the first quarter of the year, almost twice the 2,227 units released in the previous quarter.

Colin Tan, head of research and consultancy at Chesterton Suntec International, reckons that the increase in supply of private residential units may help temper prices further in the next quarter.

 

[UseYourBrain]

YES!!! That's the way it should go....I am cashing in end of year..

Long Live Mah!! Majulah Singapuira

 

[palden]

Keep it up mbt. You are my saviour. Make sure HDB costs at least 5mil by end of this year!!!!

 

[longbow]

Property market is like big ship, cannot turn abruptly or else all sorts of problems.

By increasing the number of BTO HDB, MBT will start slowing down HDB resale prices. as we know large% of market depend on HDB pricing.

 

[batman1]

Was at the heartland kopi shop,heard one customer said "when will HDB price fall to affordable or cost price".Another customer said "HDB price will fall only when MBT got langa by lorry !" This is the sentiment of the ordinary folks.Stupid sinkees always think that when their HDB flats worth $1 million,they will get $1 million.Yes,unless they have 2 HDB flats or they will migrate after selling their HDB flats !

 

[ChaoPappyPoodle]

Years ago, before the prices of new flats were pegged to those of resale flats, the PAP effectively created a floor price for housing in Singapore. With HDB flats effectively used as a floor price, all other housing were priced higher than HDB flats.

While these prices were low the impact on home buyers was not so great; housing was still truly affordable and homes could be fully paid for in 10 or at most 15 years.

What Floor Price theory dictates is that soon a surplus of homes will be put out in the market by private developers. This is theory that is immovable. Private developers could earn supernormal profits as their prices could always be above HDB prices and people would still demand for private homes. As expected, a surplus of private homes is created and yet prices are still above HDB prices, the floor price.

As years went by the HDB started pegging the prices of new flats as a percentage of resales flats. As if things wern't silly enough with a floor price, this single act would inevitably increase home prices astronomically almost overnight.

What this single act did was to create a cycle of ever increasing home prices. Private developers will always price above the floor price and as the floodgates to foreigners oppened up to allow them to purchase homes here, it was inevitable that even HDB resales prices would increase as a result. This is to be expected even without foreigners as Singaporeans would not sell their private homes below HDBs floor prices.

In short, HDB's policies created a situation where home prices will continually increase at a rate which cannot be supported by wage increases which are tied to global shifts. Our home policies are very much centered on local conditions, floor pricing created by HDB and the number of new flats created by HDB.

As HDB resale prices increased so did prices of new HDB flats. This cycle is vicious and will continue for as long as the government pegs prices of new flats to those of resale flats.

This model of pricing new flats to resales flats will in a short time create a scenario where a large number of Singaporeans will be priced out of the home ownership market.

The HDB model of pricing relies heavily on the use of CPF to make mortgage payments and this inevitably destroys the pensions of Singaporeans.
Add to this the fact that PAP ministers have their salaries pegged to GDP and you can again see why the PAP government has no incentive at all to correct this problem.

Singaporeans must be told of the disastrous path where the PAP has put them onto. Singaporeans must realise that this path evenif good in the short term, will lead to a situation where their own children will not be able to afford their own homes and they themseves may not have sufficient funds for retirement.

Singaporeans must realise that someone has to do something and that the PAP is the last group of people to want to do anything about it.

Singaporeans have to decide how serious this situatin is today and that things will get worse very fast as the influx of FTs has exacerbated the problem exponentially.

Singaporeans have to vote for their future and those of their children. All we need is to vote out 44+ PAP ministers in the next election. The civil service will still function as per normal. The major difference is that policies will now be more centered towards the needs and wants of the population instead of a group of men.

Vote for Change
Merdeka from PAP
Merdeka for Singapore

 

[po2wq]

wa! ... ah tan make ur palace make u a millionaire! ... u r so rich! ...

 

[Ginchiyo Tachibana]

bump~~~~~~