Gloomy outlook? Hmm. Photo credit: hsalnat, Flickr

Everyone is asking the same question with regards to the current financial market as Singapore Exchange (SGX) seem to be volatile with no directions.

Greece/ Europe Situation

With over 54 billion euros in debt, Greece as alongside with Spain and Portugal sent a shock wave to the global economy to end Singapore Exchange’s bullish streak from over 3,000 index point back to the 2,700 point in a matter of 1 week.

This highlights the fragility of the Euro dollar and its economy with 16 countries of the EU zone tied to one currency. As there’s no solution to Greece’s pressing issues at this stage, the world economy’s eyes will be watching and following tightly.

Here’s how the Greece problem happened.

Government injecting Land Sales

The government has been introducing numerous land to allow local developers to top up their land banks as we understand developers are running short of supply. This effectively brings down the possible en bloc fever that has happened in 2007 in which was the former peak of the real estate prices in Singapore (At current, 9 en blocs has been successful this year).

With more land supply coming into the market and with Government stepping in with measures such as the Seller’s Stamp Duty to cool prices down. It’s quite clear that the Government introduce more measures to cool the market down if the price continues to climb.

Additional Home Supplies Coming Along for TOP Projects

Numerous projects are about to TOP soon and with some already having obtaining their Occupancy Permit, you will have more supply in the market. Owner-occupied units are unlikely to be affected unless the job economy is not doing well. What we are afraid of would be only investment units which are looking for tenants. If there’s a good number of tenants coming into the market, the prices will maintain;

On the contrary should the units be empty, investors will be tested on their pockets on the ability to hold out for either a good or bad rental.

Is it a Good Time still to Buy?

All these seems to be market dampener no matter what angle you look at it. Personally, my take is its always a good time to buy should you be able to identify and justify your property purchase.

For example, If a condo development has 176 units and only has 7 units of 2-bedroom units and the rest are bigger. No matter how you look at it, you know you’ll never go wrong in the long haul with the supply and demand math.

Its also never wrong to start buying early if its for your own stay. No matter how the market declines, it will come back as our estate cycles are getting shorter. And in a good or a bad market, there’s always transactions that looks reasonably fair and attractive in prices. How would you explain that?

With a land scarce situation that Singapore is facing with the growing population on a limited amount of land, and even for the Government to start devising an Underground Master Plan. land value could only head north overtime.

My two cents. What’s yours?

Market Sentiments – Will Singapore Property Market Turn? is a post from: Benson Koh, a Singapore Realtor

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Get your pdf released of The Edge’s property deals between the week of April 20th to 30th.

This issue focuses on the pick up activity in the recent weeks in sub-sale and resale market. As I’ve mentioned on the activities that are happening a few days ago, everyone can feel the momentum of the subtle price swing towards the upside again.

The Edge – Property Done Deals Between April 20th to April 30th 09 is a post from: Benson Koh, a Singapore Realtor

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Well we’ve already slide into almost about 3 – 6 months of hourglass movement where the sellers’ market has eventually toppled over fully by the buyers. Inevitably this has uncannily become the same for the landlords to the tenants.

Buyers and Tenants, it's yours in 2009 now Photo courtesy of PretamRao

Buyers and Tenants are now the one with the say in the market.

We’ve seen newspaper reports on more retrenchments homing in after the Chinese New Year period which is about just 3 weeks away, which would cost more people to be distressed and worry about their mortgage loans; especially for those who have taken up Deferred Payment Scheme (DPS) for the new projects which are getting their TOP in 2009/ 2010.

Should the current crisis be affecting the buyers who bought on DPS, even if they have secured a loan with the bank, there might be still be chances these people might default. Again, those who would be in serious trouble are those who hasn’t secure a loan from the bank yet 3 months ago as local banks has taken their stances by already reducing their loan value of only up to 80% of the intended purchase property (The last I knew, UOB, OCBC and DBS is confirmed at 80% rate).

Buying/ Renting Opportunities

With property prices setting to slide further, this creates many possible opportunities of good buys as well as securing a good bargain for rental be it even for commercial or residential.

For the Residential Buyers

We’ll be seeing buying opportunities even in the prime districts like 9, 10, 11 affected. It probably would be a good time to buy for investment in Q2 of 2009 when we would see the full impact of the crisis after consumers cuts their spendings after Chinese New Year and more people losing their jobs. As gloomy as it is, those people who are in-the-money from the enbloc craze in 2006 – 2007 and hasn’t bought anything would have the last laugh.

I’ve seen good condominium units in Devonshire and Jervois going at very realistic and good price medians. Kudos to those who’re waiting.

For the Commercial Tenants

Business which are not affected badly by the crisis or are expanding could take this time to renew a decent tenancy with the landlord or look for even more bigger spaces to expand. Landlords are definitely in a softer position and would not be as skeptical as a year ago to listen to tenants’ proposals. If you have been a good tenant and punctual on your rents, they will definitely try to retain you.

Indeed the chinese phrase 危机 (the flip of two sides, the danger times and opportunities) has become imminently true for people who’re ready for the buying/renting to ride the next boom in at least 2011, 2012.

Buyers and Tenants Market – Your Call Now is a post from: Benson Koh, a Singapore Realtor

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Just read a mailer from Tony, Knight Frank on an article in Business Times talking about lower bank interest rates here at home since key interest rates from the States will be cutting tremendously within the next 12 months , meaning adjustments to our SIBOR (Singapore InterBank Offered Rate). It only means two huge things for people who keep their money in the bank and for people who borrows money to do investments or businesses here at home in Singapore.

The faces of your key interest rates decision makers lol.
Photo Credit: fintag

For People Who Keeps Their Money In the Bank

Chances are you’ll lose out if you keep your money in a savings account during this season if your main purpose is to earn interest for the next few months. Unless the bank is giving you a fixed rate (usually, and very low), you would be suffering from lower interest earning power.

For People who Loans Invests in Property and Businesses

Congratulations, it means lower cost for you! I’d reckon the adjustment movements on Sibor and the rates on your banks won’t be taking effect so soon, but it’s a good borrowing time if you are buying properties like houses, shophouses or office even as an investment.

The sentiments for US eating into a recession is very strong, but it shouldn’t impact our economy much. Asian countries has came a long way from the 97-98 Asian Crisis and have definitely diversified their nests all around instead of concentrating all its eggs on the US economy. I’ve read even about neighbour Malaysia’s Central Bank, Bank Negara breaking borders on its monetary reserves (at 101.3 Billion US Dollars) being able to survive for even in face of another crisis should one arise.

Much shouldn’t be said for our own Singapore Government being prudent on our reserves and investment overseas. We’re generally sound.

Plunging Key Interest Rates, A Good Time to Borrow? is a post from: Benson Koh, a Singapore Realtor

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