Outlook for Sg property market

[Merg91]

That's why Mummy doing 'research' here

 

[ocs_woodlands]

1 sentence.

There will always be a Teban garden 3 room flat owner offering his 3 room flat for sale at $1m and so what?......

 

[BBCWatcher]

The only asset class safe for leverage when compared to bonds and equities.

When you (personally) buy stocks or a stock fund without a personal debt obligation, you're still investing with significant leverage. The companies you're investing in undertake their activities with leverage. When they win, you win.

Apple (AAPL), for example, has over US$112 billion of outstanding debt on its balance sheet. (It has even more cash and cash equivalents, but it has a lot of low cost debt, too.) But, unlike direct real estate purchases with leverage (a mortgage), you are not personally responsible for Apple's debt when you buy Apple's shares -- either separately or in fund form. Indeed, in Singapore loans such as mortgages are full recourse loans, or nearly so. If you default the lender takes the property, and if the proceeds from the foreclosure aren't enough to cover outstanding debt, interest, and penalties, the lender has the legal right to try to grab more of your personal assets. You can bet the lender will try.

Unlike individual pieces of real estate, most stocks and stock funds happen to be highly liquid. You can get quotations at least during market hours and often more often than that. But you shouldn't confuse liquidity and a flood of available quotation data with risk. Real estate is probably just as volatile in terms of instantaneous valuations, perhaps even more so. (What's your house worth for a sale agreed within the next 5 seconds? Think that number will bounce around like a crazed clown on a trampoline? Yes, oh yes.) There's simply no functioning market with new price quotations every second (or more often) for postcode 123456 unit #07-08, that's all. It's a highly illiquid asset, one that's seldom (re)valued and never for a hypothetical sale with a 5 second offer expiration.

Anyway, I'm rather tired of the tired arguments that stock investing doesn't involve leverage. It most certainly does, and quite a lot of it, automatically, even if you're buying stocks solely with personal cash. You're investing in real business enterprises and their activities, including leveraged activities. But you're not personally liable for that corporate debt. It's ridiculous to argue that a personally liable mortgage is "safer" than that.

For the record, to repeat, I'm not opposed to real estate. But the "real estate RULEZ ALLLLLL!!!!!" nonsense is nonsense, truly. Diversify well.

 

[Merg91]

Very few stock millionaires but many many strike it in properties.

 

[Toni90]

When you (personally) buy stocks or a stock fund without a personal debt obligation, you're still investing with significant leverage. The companies you're investing in undertake their activities with leverage. When they win, you win.

Apple (AAPL), for example, has over US$112 billion of outstanding debt on its balance sheet. (It has even more cash and cash equivalents, but it has a lot of low cost debt, too.) But, unlike direct real estate purchases with leverage (a mortgage), you are not personally responsible for Apple's debt when you buy Apple's shares -- either separately or in fund form. Indeed, in Singapore loans such as mortgages are full recourse loans, or nearly so. If you default the lender takes the property, and if the proceeds from the foreclosure aren't enough to cover outstanding debt, interest, and penalties, the lender has the legal right to try to grab more of your personal assets. You can bet the lender will try.

Unlike individual pieces of real estate, most stocks and stock funds happen to be highly liquid. You can get quotations at least during market hours and often more often than that. But you shouldn't confuse liquidity and a flood of available quotation data with risk. Real estate is probably just as volatile in terms of instantaneous valuations, perhaps even more so. (What's your house worth for a sale agreed within the next 5 seconds? Think that number will bounce around like a crazed clown on a trampoline? Yes, oh yes.) There's simply no functioning market with new price quotations every second (or more often) for postcode 123456 unit #07-08, that's all. It's a highly illiquid asset, one that's seldom (re)valued and never for a hypothetical sale with a 5 second offer expiration.

Anyway, I'm rather tired of the tired arguments that stock investing doesn't involve leverage. It most certainly does, and quite a lot of it, automatically, even if you're buying stocks solely with personal cash. You're investing in real business enterprises and their activities, including leveraged activities. But you're not personally liable for that corporate debt. It's ridiculous to argue that a personally liable mortgage is "safer" than that.

For the record, to repeat, I'm not opposed to real estate. But the "real estate RULEZ ALLLLLL!!!!!" nonsense is nonsense, truly. Diversify well.

In the last 15 years, how much money you made from stock and how much money your landlord made from the property?

 

[chrisloh65]

When stocks of companies leverage and make money, you don't get the full leveraged return into your pocket.

When you leverage using your own money into properties, you get the full returns into your pocket.

This is the most significant difference. Some people just don't get it.

When you (personally) buy stocks or a stock fund without a personal debt obligation, you're still investing with significant leverage. The companies you're investing in undertake their activities with leverage. When they win, you win.

Apple (AAPL), for example, has over US$112 billion of outstanding debt on its balance sheet. (It has even more cash and cash equivalents, but it has a lot of low cost debt, too.) But, unlike direct real estate purchases with leverage (a mortgage), you are not personally responsible for Apple's debt when you buy Apple's shares -- either separately or in fund form. Indeed, in Singapore loans such as mortgages are full recourse loans, or nearly so. If you default the lender takes the property, and if the proceeds from the foreclosure aren't enough to cover outstanding debt, interest, and penalties, the lender has the legal right to try to grab more of your personal assets. You can bet the lender will try.

Unlike individual pieces of real estate, most stocks and stock funds happen to be highly liquid. You can get quotations at least during market hours and often more often than that. But you shouldn't confuse liquidity and a flood of available quotation data with risk. Real estate is probably just as volatile in terms of instantaneous valuations, perhaps even more so. (What's your house worth for a sale agreed within the next 5 seconds? Think that number will bounce around like a crazed clown on a trampoline? Yes, oh yes.) There's simply no functioning market with new price quotations every second (or more often) for postcode 123456 unit #07-08, that's all. It's a highly illiquid asset, one that's seldom (re)valued and never for a hypothetical sale with a 5 second offer expiration.

Anyway, I'm rather tired of the tired arguments that stock investing doesn't involve leverage. It most certainly does, and quite a lot of it, automatically, even if you're buying stocks solely with personal cash. You're investing in real business enterprises and their activities, including leveraged activities. But you're not personally liable for that corporate debt. It's ridiculous to argue that a personally liable mortgage is "safer" than that.

For the record, to repeat, I'm not opposed to real estate. But the "real estate RULEZ ALLLLLL!!!!!" nonsense is nonsense, truly. Diversify well.

 

[RMCWMR]

When you (personally) buy stocks or a stock fund without a personal debt obligation, you're still investing with significant leverage. The companies you're investing in undertake their activities with leverage. When they win, you win.

Apple (AAPL), for example, has over US$112 billion of outstanding debt on its balance sheet. (It has even more cash and cash equivalents, but it has a lot of low cost debt, too.) But, unlike direct real estate purchases with leverage (a mortgage), you are not personally responsible for Apple's debt when you buy Apple's shares -- either separately or in fund form. Indeed, in Singapore loans such as mortgages are full recourse loans, or nearly so. If you default the lender takes the property, and if the proceeds from the foreclosure aren't enough to cover outstanding debt, interest, and penalties, the lender has the legal right to try to grab more of your personal assets. You can bet the lender will try.

Unlike individual pieces of real estate, most stocks and stock funds happen to be highly liquid. You can get quotations at least during market hours and often more often than that. But you shouldn't confuse liquidity and a flood of available quotation data with risk. Real estate is probably just as volatile in terms of instantaneous valuations, perhaps even more so. (What's your house worth for a sale agreed within the next 5 seconds? Think that number will bounce around like a crazed clown on a trampoline? Yes, oh yes.) There's simply no functioning market with new price quotations every second (or more often) for postcode 123456 unit #07-08, that's all. It's a highly illiquid asset, one that's seldom (re)valued and never for a hypothetical sale with a 5 second offer expiration.

Anyway, I'm rather tired of the tired arguments that stock investing doesn't involve leverage. It most certainly does, and quite a lot of it, automatically, even if you're buying stocks solely with personal cash. You're investing in real business enterprises and their activities, including leveraged activities. But you're not personally liable for that corporate debt. It's ridiculous to argue that a personally liable mortgage is "safer" than that.

For the record, to repeat, I'm not opposed to real estate. But the "real estate RULEZ ALLLLLL!!!!!" nonsense is nonsense, truly. Diversify well.

I somewhat disagree.
1. Its very hard to leverage on stocks on the cheap to make any decent returns if you have limited capital. Even for CFDs you are paying almost 4+% p.a. in financing cost to leverage up. And then there is a max cap on leverage. For layman/ordinary folks like me, brokers won't allow me to leverage past $50k. Which is peanuts and won't make one rich with limited capital. Compare that with property where you can leverage up to 75% at a financing cost of 2.3% p.a. paid by installment over 30 years.

2. While you don't "assume" the company debt, you also have no control over how much or how little debt the company can or want to take on. I'm sure you know some companies over leverage themselves then get hit badly when they hit a bad patch like the recent hyflux case causing shreholders to lose everything. In short, there is nothing shareholders can do if a company decides to go stupid. Property on the other hand, almost never have 0 value despite what some naysayers say about 99 years property, at least in Singapore context up todate.

3. Too many external factors influence prices of shares. I'm sure you know even if a company is making truckloads of money ripping apart analyst estimates, there is no guarantee that particular stock price will skyrocket. In fact I have noticed some counters with good earnings and strong balace sheet lose 50% of their share value just because sentiments turn sour and shortist keep shorting a counter. Case in point Venture Corp.

 

[dork32]

a property is valued at 4 mil. it is placed in the market over an extended period but there are no takers.

finally it is sold to you at 3 mil. what do you think is the value of the property?

yeah you still value at 4mil. who do you think will pay 4 mil for the property if you try to flip.?

like i said before, mummy's mathematics inflate numbers to make her investment decisions look fantastic.

 

[JuniorLion]

Grandma story ma.
Her long story is like those Taiwanese TV series, 100 集also no ending.
Soon 3 millions then 10 millions liao.

5000 episodes. And every episode, the plot is the same. Her useless husband, her clinic, her locum, her properties.

Nobody here believes her anyway.

 

[luei74]

Quite true.

Now waiting for agents to persuade sellor's wife. And for me to persuade my hubby.

Heard seller's wife agree but Xiao San never agree Mumny

Sent from Xiaomi MI MAX 3 using GAGT

 

[Merg91]

Did her small white faced approved?
Or he backstabs?
The plot thickens.......
This TV series can't end so soon.

Heard seller's wife agree but Xiao San never agree Mumny

Sent from Xiaomi MI MAX 3 using GAGT

 

[NewInvestor]

Not just flipping.
Even buying and holding it .. your success rate of getting a million is much much higher when compared to bonds and equitiees.

I agree. Properties is a must for any portfolio. But add equities n bonds to your portfolio for their liquidity.

 

[SBC]

A faulty clock is right twice in a day.

Mummy1234 will be rite 1 fine day.

 

[BBCWatcher]

Very few stock millionaires but many many strike it in properties.

There are quite a large number of stock millionaires. Worldwide, there are very few property millionaires.

Among the world's wealthiest individuals, literally nobody at the top of the list is wealthy due to real estate. You have to go way, way down the list before you see anybody who is a real estate tycoon.

I would point out, again, that real estate is comparatively heavily taxed in Singapore. But if you want to pay more taxes (and thus help reduce mine), I'm not opposed.

In the last 15 years, how much money you made from stock and how much money your landlord made from the property?

Quite a lot, and you're assuming I have a landlord and the landlord has made money. Big assumptions!

When stocks of companies leverage and make money, you don't get the full leveraged return into your pocket.

I'm not sure what you mean. Who else gets the returns? You own the business, your share(s).

I somewhat disagree.
1. Its very hard to leverage on stocks on the cheap to make any decent returns if you have limited capital.

You're missing the point. The businesses leverage -- their management does it. That's when you buy shares of stock using cash. There is leverage, quite a substantial amount of it.

I'm not talking about buying stock on margin, but of course you could do that. I'm talking about buying stock with cash. The share of the real business that you then own is a real business that borrows, that leverages -- and you participate in that. You're a shareholder.

2. While you don't "assume" the company debt, you also have no control over how much or how little debt the company can or want to take on. I'm sure you know some companies over leverage themselves then get hit badly when they hit a bad patch like the recent hyflux case causing shreholders to lose everything. In short, there is nothing shareholders can do if a company decides to go stupid. Property on the other hand, almost never have 0 value despite what some naysayers say about 99 years property, at least in Singapore context up to date.

There are plenty of real properties that are now worthless, and that's a possibility in Singapore -- I can't rule it out. Indeed, that pretty much happened in 1942, within the living memory of people still alive. The probability that the value of the entire investable planet's enterprises (e.g. IWDA, VWRA) collectively falls to zero is a much, much lower probability.

3. Too many external factors influence prices of shares. I'm sure you know even if a company is making truckloads of money ripping apart analyst estimates, there is no guarantee that particular stock price will skyrocket. In fact I have noticed some counters with good earnings and strong balace sheet lose 50% of their share value just because sentiments turn sour and shortist keep shorting a counter. Case in point Venture Corp.

Yes, that's possible. It's also possible and has actually happened with REITs, which are nothing more than collections of real property.

An illiquid, seldom market valued asset isn't less volatile because it's seldom valued. That's not how it works. When real estate is securitized and publicly traded in high volume (popular REITs, REIT funds) it's at least as volatile as stocks.

Look, I'm not the one arguing against real estate. I have some exposure to property. I think it's just supremely dumb to be so ridiculously over-the-top focused on real estate that it represents a huge or huger portion of household wealth, especially if that's in only one country. Stay well diversified, that's all -- maintain some balance.

 

[RMCWMR]

a property is valued at 4 mil. it is placed in the market over an extended period but there are no takers.

finally it is sold to you at 3 mil. what do you think is the value of the property?

yeah you still value at 4mil. who do you think will pay 4 mil for the property if you try to flip.?

like i said before, mummy's mathematics inflate numbers to make her investment decisions look fantastic.

Every property is different. Every property is unique. Just because the last one transacted at $3million does not mean the next one cannot transact at $4million. Its about how one markets that property and its uniqueness. Otherwise there won't be so many $1million HDB transacted

 

[turnaround]

Waiting for sentosa cove prices to drop further

 

[Small Lee Fly Dagger]

Every property is different. Every property is unique. Just because the last one transacted at $3million does not mean the next one cannot transact at $4million. Its about how one markets that property and its uniqueness. Otherwise there won't be so many $1million HDB transacted

By the same measure, doesn't mean the next one cannot transact at $2million either.

 

[Merg91]

Similar location /size can't be 25% diffence.
The (different height/view) flats in the block with $1 million flat may differ a bit / how desperate one is.

Every property is different. Every property is unique. Just because the last one transacted at $3million does not mean the next one cannot transact at $4million. Its about how one markets that property and its uniqueness. Otherwise there won't be so many $1million HDB transacted

 

[RMCWMR]

By the same measure, doesn't mean the next one cannot transact at $2million either.

Yes that is true. Again depends on how one markets the unit. That is why it is important to get a good property agent to accentuate the selling points of your unit.

 

[RMCWMR]

Similar location /size can't be 25% diffence.
The (different height/view) flats in the block with $1 million flat may differ a bit / how desperate one is.

Who says? There are alot of factors which can result in price changes even at the same floor and same size. For e.g. a unit with panaromic unblocked views of the city will command much more than the same unit with same size and same level but with blocked view. Similarly a well renovated unit will fetch a better pricing than a bare unit.