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MAS makes commentators look foolish again

Published

7 years ago

on

by Property Soul

Last Thursday, Managing Director of Monetary Authority of Singapore (MAS) Ravi Menon mentioned at the annual report media conference that it is “not time yet to ease the cooling measures”, “they remain necessary” and “easing the measures now would send a wrong signal”.

Sorry, cooling measures are to stay

Menon cited two reasons for the decision: 1) Good pick-up of recent project launches under low interest rate environment; and 2) Increased tightening of property buying restrictions in other countries.

Menon emphasized that “property prices should be aligned with broader income trends in the economy and the government will not let “property prices increase faster than nominal GDP growth”.

Private residential property prices have climbed 60 percent over 17 quarters, but only declined less than 12 percent in the last 14 quarters.

Menon restated that MOF, MND, and MAS were all very clear in the March announcement that the adjustments “were made for very specific reasons and purposes” and the government has never changed its position on the TDSR structure, Additional Buyer’s Stamp Duty and Loan-to-Value limits.

“The calibrated adjustments by the government earlier this year do not signal the start of an unwinding of the property cooling measures, as some commentators have suggested.”

Oops, MAS just gave industry stakeholders who speculated further relaxation of cooling measures a real slap on the face!

The market tends to make us look foolish most of the time, isn’t it?

Those who recently bought on deferred payment scheme or stay-then-pay programme should now realize that the wait may not be just one to two years’ time.

Edmund Tie & Co told the media last month that one investor takes ABSD in buying properties as the COE in buying cars, if the government is not lifting ABSD.

What the investor fails to see is: All car owners have to pay COE to drive a car. But not all property owners have to pay ABSD to buy a home. It depends on when they buy it and whether they are buying their first property.

Next time when he is competing with other owners of similar units in the same project for tenants or buyers, he will realize that they are not competing on equal footings because of the ABSD he has paid.

Why some commentators still don’t get it?

In fact, the commentators are not being slapped once but again and again by the government.

Every time when there was market speculation on relaxation of the cooling measures, the government would not hesitate to come upfront and put it straight.

A contrarian’s view? Who bothers?

You can’t blame industry stakeholders who assured you that the government will lift ABSD soon; or Morgan Stanley who predicted that Singapore property prices to double by 2030; or JLL who claimed that residential market will likely to recover by early 2018 – when home buyers are taking the plunge fearlessly; when new launch projects are selling like hot cakes; when developers are bidding hungrily for new sites like there’s no tomorrow.

All these analysts are predicting that the property market will recover any time soon. We haven’t seen such positive market sentiments for a long time.

Who bother to be a contrarian here?

I did have a few blog posts with a different view:

1) It’s not bottoming-out. It’s dead cat bounce.

2) 3 reasons why adjustments to property measures is not a good sign

3) Who said property cooling measures may never be lifted?

I am not saying that the property market will crash soon. I just believe that the market is going to be different from what the local media and industry stakeholders are predicting.

Ken Fisher said in his book Beat the Crowd that a contrarian doesn’t have to hold an “opposite view” from the majority. A contrarian just holds a “different view”. If most people believe that this is what‘s going to happen in the market, the contrarian simply believes that something else will.

History tells us that the market likes to make most of us look foolish most of the time. It always gives us an anti-climax at the maximum point of optimism.

“The contrarian looks for things the herd and curmudgeons ignore – they branch out. Or they look at the same things but see them differently. Both actions let them find the risks and opportunities most others miss.”

“A 60% or 70% success rate keeps you well ahead of most … if you’re right 70% of the time in this realm, you become an absolute living legend.”

You see, I am only targeting 60 percent or at most 70 percent of the time to be right. I said it about Iskandar and Malaysia properties 3 years ago in 2014. I said it about market slowdown and some other things as well. It’s not too difficult to be 60 to 70 percent of the time correct, isn’t it?

This article was first published at PropertySoul.com

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Property

Flat in Toa Payoh sold for S$1.2M, becomes most expensive 4-room HDB in estate

A four-room HDB flat at Toa Payoh Crest has set a new record, selling for S$1.201 million. The 1,000 sq ft flat, located between the 37th and 39th storeys of Block 130A, has 93 years left on its lease. This September transaction eclipsed the previous high of S$1.2 million for a flat in neighboring Block 131B.

Published

2 weeks ago

on

30 September 2024

By

SINGAPORE: A four-room Housing and Development Board (HDB) flat in Toa Payoh has been sold for a record-breaking S$1.201 million, setting a new high for the area.

The 1,000 sq ft flat, located at Block 130A Lorong 1 Toa Payoh in the Toa Payoh Crest estate, has 93 years left on its lease and sits between the 37th and 39th storeys.

The flat, sold in September for S$1,200,888, surpassed the previous record held by a similar four-room flat at Block 131B, which fetched S$1.2 million in June this year.

Source: HDB

Highly Sought-After Estate

According to property portal 99.Co, Toa Payoh Crest, completed in 2018, has emerged as a popular choice for homebuyers.

The estate comprises four 40-storey blocks with a total of 1,007 units. So far, it has recorded 16 million-dollar-flat transactions this year alone.

The estate’s prime location contributes to its high demand.

Based on Google Maps, Toa Payoh Crest is conveniently located near three MRT stations: Caldecott, Braddell, and Toa Payoh.

In addition, its proximity to Toa Payoh West Market and Food Centre, as well as Toa Payoh Central, makes it highly attractive for potential buyers.

The unblocked view of the city skyline, thanks to the undeveloped plot of land next to the estate, further enhances its appeal.

Price Hikes and Concerns

Although record-setting resale prices continue to make headlines, Minister for National Development Desmond Lee pointed out on August 20 that flats with very high resale prices account for “a very small proportion of all transactions.”

He noted that such sales represent only 0.5 per cent of all four-room or smaller flat transactions in the past two years.

These units tend to be centrally located, well-connected to public transport, and situated on very high floors with good views.

Nevertheless, the rise in million-dollar flats has sparked concerns about the affordability of resale flats in general.

Minister Lee warned that these transactions could lead to unrealistic price expectations among sellers and anxiety among buyers, potentially distorting market dynamics.

He cautioned that if the market moves too far out of sync with economic fundamentals, it could result in a property bubble.

Million-dollar flats currently account for about 2 per cent of all resale transactions over the past 1.5 years.

In August alone, 104 flats were sold for at least S$1 million, down from 120 in July.

In the first seven months of 2024, 539 HDB flats crossed the million-dollar threshold, compared to 470 in 2023 and 369 in 2022.

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Property

Newly MOP-ed projects in Bidadari and Ang Mo Kio fetch S$1.2M and S$1.08M

Two recently MOP-ed projects have achieved impressive resale values: a unit at Alkaff Vista in Bidadari sold for S$1.2 million, marking the highest resale in the area, while a flat at Cheng San Court in Ang Mo Kio fetched S$1.08 million, making it the most expensive 4-room HDB resale not just in Cheng San Court but throughout Ang Mo Kio.

Published

3 weeks ago

on

23 September 2024

By

SINGAPORE: Two recently MOP-ed (Minimum Occupation Period) projects have achieved significant resale values.

As per reported by Singapore’s property portal 99,co, a unit at Alkaff Vista in Bidadari sold for S$1.2 million, while a flat at Cheng San Court in Ang Mo Kio fetched S$1.08 million.

A check on HDB website indicated that the S$1.2 million 5-room unit located at Block 106A, Bidadari Park Drive.

This particular unit, situated between the 7th and 9th floors of the 17-storey building, spans 1,216 square feet.

Launched in 2010 and completed in 2019, Alkaff Vista boasts nearly 95 years remaining on its 99-year lease, contributing to its substantial market value.

When Alkaff Vista’s BTO units were initially launched, 4-room flats began at S$433,000.

Alkaff Vista offers a range of amenities, including a children’s playground, fitness stations, and a roof garden on the 8th storey, appealing to families and individuals alike.

Its location adds further allure, being a mere 5-minute walk from Potong Pasir MRT Station and conveniently close to various shopping hubs and schools, such as Cedar Primary School and St. Andrew’s Junior School.

Interestingly, the S$1.2 million sale stands as the highest resale not only in Alkaff Vista but across Bidadari.

This project is the first in the area to reach MOP, and its current lack of competition may have contributed to the elevated prices.

As more projects in Bidadari reach MOP, it is anticipated that additional million-dollar sales will follow.

This S$1.2 million sale is not an isolated event; in fact, three other transactions from the project were also sold at impressive prices, with two of them exceeding the S$1 million mark.

4-Room unit at Cheng San Court Achieves S$1.08 Million Sale

Meanwhile, a unit at Cheng San Court (Block 590B, Ang Mo Kio Street 51) recently sold for S$1.08 million.

This flat, located between the 28th and 30th floors of a 32-storey block, measures 1,001 square feet and achieved a price of S$1,078 psf.

Cheng San Court, launched in 2019, is one of the youngest resale projects in Ang Mo Kio, with approximately 93 years and 6 months left on its lease.

Original buyers of this Cheng San Court unit also experienced a notable capital gain.

When the project was launched, 4-room flats were priced from S$435,000, making the recent resale price a 59.72% increase, or S$645,000.

Cheng San Court has seen a surge in million-dollar transactions since recording its first such sale in November 2023, marking Ang Mo Kio’s first-ever million-dollar sale for a 4-room flat.

With this latest S$1.08 million transaction, it stands as the most expensive 4-room HDB resale not only within Cheng San Court but throughout Ang Mo Kio.

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