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Old 08-12-2011, 09:39 PM   #1
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Impact of New Cooling Measure : ABSD

After the government introduce Additonal Buyer's Stamp Duty, Do you think we can start buying private properties in the next six months?
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Old 09-12-2011, 01:04 AM   #2
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After the government introduce Additonal Buyer's Stamp Duty, Do you think we can start buying private properties in the next six months?
Seriously a lot of people are very naive when they think that property prices will start falling and crashing.

Just look at the umpteenth time the govt has tried to come out with a cooling measure which the buyers have consistently proved them wrong.

The 1st step of reducing 80% loan to 70%. No use.
2nd step of reducing 70% to 60% loan for 2nd property. No use.
This shows that people are buying not based on credit but by real cold hard cash.

Ok, they fall flatly and now decided to implement Sellers Stamp duty with 3 years at 1st. And then improve this implementation of theirs with 4 years SSD at a whopping 16% upon selling at the 1st year. Again, the buyers defy the govt by buying again and again. This shows that people are buying and willing to hold on to their purchase.

Today, the govt comes up with Buyers Stamp Duty at a huge 10% on foreigners wanting to stop them from buying. Seriously, if the market is quiet now, it is expected. It is a knee jerk reaction and after the dust has settle down, people will still buy and Singaporeans will follow.

The govt has only temporary stop people from buying thinking that they stop a bubble in their eyes. But they did not realise that this group of people who have been really buying are not the 1st timers but property investors who will just channel their buys for the next 2 months to properties in Malaysia, Australia, London, Japan, etc.

To those foreigners who bring out their money from their home country into Singapore, they are buying in Singapore because buying in Singapore is so much worthwhile than buying in their home country. Not to forget the stability and security. How will developers drop their price when they have already done a "mark up" based on demand and I post a scenario that at $1300psf and 10% would just be a $130 off the psf and marking it at $1170psf.

Buyers will just put this 10% extra as part of their purchase price. Developers just earn lesser, buyers just earn lesser and the govt earns more. That's about it.

Reducing the property picture to the days of $500-$600psf or even lower and thinking that this measure alone can crash the market is simply naive. Remember this is a cooling measure, not a world economy problem.

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Old 09-12-2011, 11:06 AM   #3
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got some question regarding the ABSD for PR, it stated that for 2nd property need to pay 3%

What if the guy sell HDB and buy Private at the same time using bridging loan, is it still considered 2nd property ?
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Old 09-12-2011, 11:08 AM   #4
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the markets are sentiment driven, it can overshoot on the upside and also overcorrect on the way if sentiments shifts dramatically to pessimism

the factors that drove up property prices here are slowly evaporating,
huge foreign influx that drove demand up are slowing to a trickle,
MBT deliberate policy of under supply has been reversed by Khaw Boo Wan,
there are increased reports of job losses and pay/bonus cuts across many industries,
property bubbles are popping one by one, latest being Norway and China,

what remains is low interset rates and cheap money, once that is gone, anything can happen

the current prices are simply unsustainable long-term on an price- income ratio basis for the average worker
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Old 09-12-2011, 12:13 PM   #5
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the markets are sentiment driven, it can overshoot on the upside and also overcorrect on the way if sentiments shifts dramatically to pessimism

the factors that drove up property prices here are slowly evaporating,
huge foreign influx that drove demand up are slowing to a trickle,
MBT deliberate policy of under supply has been reversed by Khaw Boo Wan,
there are increased reports of job losses and pay/bonus cuts across many industries,
property bubbles are popping one by one, latest being Norway and China,

what remains is low interset rates and cheap money, once that is gone, anything can happen

the current prices are simply unsustainable long-term on an price- income ratio basis for the average worker
Foreign influx has in fact not been slowing down prior to this current ABSD. Right now it will definitely create a knee jerk reaction. Singaporeans being on the kiasi side will definitely stand on the by lines for now.

But once the dust has settled, and this 10% will seriously be neglected by the foreigners. Singaporeans being on the kiasu side this time will come in again.

Non-sustainability is what we all think but in actual fact does not represent the actual situation. If not the previous loan reduction to 60% and SSD would have brought down quite a fair bit.

Eventually thinking that this policy can help first timers only looks like it from the surface "for now". But it will cause these people more harm when those who can afford to buy still keep coming in again and again. Seriously the only way the govt can stop this is to tell everyone, Foreigners only allowed to buy 1, PR buy 2, Singaporeans buy 3, regardless of how rich and affluent you are.
Even a 10% decrease in price will still not help these first timers from achieving what they want.
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Old 09-12-2011, 12:28 PM   #6
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A crash can only happen if there is a black swan event. Like collapse of Euro..for example.
Else another is high interest rates. Right now, these measures are just ways of putting people off in property. Only when interest rates popped up then we will see the real effect.
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Old 09-12-2011, 01:29 PM   #7
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I agree. The cooling measures are just stepping stones to cool the market before the BiG BANG.

What is the Big Bang? When Interest rate shoots to 5-8%. that's called POWER. Woe to all the greedy speculators and developers.

The government is trying to do everything to slow down this Big Bang, but it will come inevitably unless there is a sudden V Shaped recovery in US and Europe. Highly unlikely though.
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Old 09-12-2011, 02:04 PM   #8
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I agree. The cooling measures are just stepping stones to cool the market before the BiG BANG.

What is the Big Bang? When Interest rate shoots to 5-8%. that's called POWER. Woe to all the greedy speculators and developers.

The government is trying to do everything to slow down this Big Bang, but it will come inevitably unless there is a sudden V Shaped recovery in US and Europe. Highly unlikely though.
bedok resevoir will be choked with dead bodies if such a scenario happens

I think it is not likely though
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Old 09-12-2011, 03:29 PM   #9
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I agree. The cooling measures are just stepping stones to cool the market before the BiG BANG.

What is the Big Bang? When Interest rate shoots to 5-8%. that's called POWER. Woe to all the greedy speculators and developers.

The government is trying to do everything to slow down this Big Bang, but it will come inevitably unless there is a sudden V Shaped recovery in US and Europe. Highly unlikely though.
The thing is everyone says their prediction and forsee. But no one can safely say what will happen. It's a question mark.

We have a lot of analysts who said market crash since 2008 and these guys are still in business after giving all the wrong predictions. So what does these tell everyone?

When you said interest shoots to 5-8%, yes you can predict on this, but the question mark is when? What happens if this happens only 20years time? So what is everybody going to do for now till the next 20years? Those who ventured already made their money, while to those who waited and decided to venture in may get the prediction they forecasted, though on a different time line.
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Old 09-12-2011, 08:11 PM   #10
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Singapore property price drop likely after new tax - Yahoo! Singapore Finance

Finance Minister Tharman Shanmugaratnam said the government is seeking to cool demand now to avoid a major price crash in the future.

so they're predicting a crash next year
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Old 09-12-2011, 11:58 PM   #11
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Singapore property price drop likely after new tax - Yahoo! Singapore Finance

Finance Minister Tharman Shanmugaratnam said the government is seeking to cool demand now to avoid a major price crash in the future.

so they're predicting a crash next year
They have been predicting a lot of wrong things.

Like how much seats they win, how much percentage they can win.
How the market will crash but not fall.
Their repeated cooling measures just exposed how weak the effectiveness of their policies are which simply does not work.

If they are good, they don't need repeated cooling measures. period
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Old 11-12-2011, 12:35 AM   #12
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actually i feel it wouldnt crash the market..just help stabilize the market..n get them get richer..haa
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Old 11-12-2011, 01:03 AM   #13
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They have been predicting a lot of wrong things.

Like how much seats they win, how much percentage they can win.
How the market will crash but not fall.
Their repeated cooling measures just exposed how weak the effectiveness of their policies are which simply does not work.

If they are good, they don't need repeated cooling measures. period
I think no government managed to get it right this year.

China, HK, SG all had to introduce several measures in a space of 1 year just for domestic property market.
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Old 11-12-2011, 09:55 AM   #14
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What if combine name like 1SC + 1SPR?
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Old 12-12-2011, 09:51 AM   #15
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What if combine name like 1SC + 1SPR?
will fall under the citizen rule
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