Executive Condo (EC) bubble?

annetyu

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1st launched in Punggol with land price bidded at $280psf/ppr. No track records of private resale. No news of SIT, Waterway Point, Safra, regional sports hub, Punggol Digital District and the latest Oasis Terrace.

It is hard to compare then. $680psf in 2010 does not seem high anyway. Which scientist/mathematician was bombarding Prive?
 

skizzer

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What were the prices for private resales and new launches at punggol at that time?

https://sbr.com.sg/property/news/executive-condominium-market-makes-comeback-five-year-hiatus

This article back in 2010 says that EC historically has a 30 percent price discount to private resale.
 

skizzer

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1st launched in Punggol with land price bidded at $280psf/ppr. No track records of private resale. No news of SIT, Waterway Point, Safra, regional sports hub, Punggol Digital District and the latest Oasis Terrace.

http://eresources.nlb.gov.sg/history/events/c31a9cc5-3c2a-4fd5-9f4a-3054f95dffa3

Well we had the real Punggol waterway (the River) construction which began in 2009. HAHAHAH
 

sft1393h

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It is hard to compare then. $680psf in 2010 does not seem high anyway. Which scientist/mathematician was bombarding Prive?
Now that you looked back 9 years ago is not high for sure. Likewise in 2028, when u look back $1100psf will also won't be high.
 

Solid_snape

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Now that you looked back 9 years ago is not high for sure. Likewise in 2028, when u look back $1100psf will also won't be high.

In 2010, the global economy was just starting to recover from the global financial crisis, collapse of Lehman etc.. prices were at low due to the sentiments of the times. We enjoyed 8 years of relatively bullish markets and growth in many sectors of the economy.

Fast forward to 2019, the economy is uncertain, there’s the trade war, the political turmoil in America, many industries are facing disruption, plus many other factors. I find it hard to believe we will have another 8 years of growth such that $1100psf will ‘also won’t be high’. But of course we may be wrong and time will reveal our folly.
 

annetyu

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Now that you looked back 9 years ago is not high for sure. Likewise in 2028, when u look back $1100psf will also won't be high.

You may be right, in 2028 sumang ec may sell for 1,700psf, but treasure trove will also rise to 1,900psf, so whats the difference?

What is important is to find the best deal in today's market ... and that is definitely not sumang ec as there are still so many cheaper punggol/SK resales.

If I remember correctly, 3 years ago, EC price was aro $800psf? Is there any basis for rising $300psf in such a short period of time? Has your income risen 30%?
 

Nobody1122

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What about location ?

Edmw always say punggol is ulu la
Slum la
Birds no lay eggs la
Lots of cecas la
Pasir Gudang la.......

Why Sumang will still sell well ?

In my opinion, sumang ec will sell well.
Other than the usual logical fact like there are a shortage of ec and cheaper alternative of pc, two trends I observed are
1. People usually new places. To you watertown and Parc centro are still new, but to the young people, they are old already.
2. People generally wouldn't mind developer earning a profit, but not the owners of existing condo.
 

jonchar

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Many years back, when DBSS was first launched, many ballk at the price and paying such money for a small place is unthinkable, even though the locations are good.

Today, many sold for above $1mil for those oh higher floors. Sometimes, it is just irritational. Take the park colonial example, unthinkable at $1.7k psf where surroundings are selling for lower. But that pricing seems to be the norm for new launches and even EC, based on breakeven for Sumang is above $1k.

Time will tell these bunch of trend setters are heroes or zeroes.
 

Clazav

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Every region has a cheaper/ulu new town.
North is Yishun/Sembawang
East is Pasir ris
Northeast is punggol/sengkang
West is jurong west
Northwest is cck/Bukit batok

In fact, punggol hdb are aesthetically more appealing than hdb from other new town.
And it has more potential than many other new towns. What does Bukit Batok, Pasir Ris have to offer?

What about location ?

Edmw always say punggol is ulu la
Slum la
Birds no lay eggs la
Lots of cecas la
Pasir Gudang la.......

Why Sumang will still sell well ?
 

fotoudavid

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Choa chu kang and Bukit batok also not bad lah 😂 got near SPCA and Qian Hu. Anyway, choa chu kang and Bukit batok getting crowded with new bto in Bukit batok. I wonder how the traffic will be if Tengah first two batches of bto up and running.
 

sft1393h

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You may be right, in 2028 sumang ec may sell for 1,700psf, but treasure trove will also rise to 1,900psf, so whats the difference?

What is important is to find the best deal in today's market ... and that is definitely not sumang ec as there are still so many cheaper punggol/SK resales.

If I remember correctly, 3 years ago, EC price was aro $800psf? Is there any basis for rising $300psf in such a short period of time? Has your income risen 30%?
EC is the bridge to move towards private properties which is considered the "luxury lifestyle". Must a "luxury lifestyle" developer price their product be in tendem with someone's income? If yes, Rolex need to revalidate their pricing too.
Luckily govt set a ceiling cap of $14k else high income earners will grab it like hot cakes.
Anyway, buying an EC is a need, not a must.
 
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sft1393h

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In 2010, the global economy was just starting to recover from the global financial crisis, collapse of Lehman etc.. prices were at low due to the sentiments of the times. We enjoyed 8 years of relatively bullish markets and growth in many sectors of the economy.

Fast forward to 2019, the economy is uncertain, there’s the trade war, the political turmoil in America, many industries are facing disruption, plus many other factors. I find it hard to believe we will have another 8 years of growth such that $1100psf will ‘also won’t be high’. But of course we may be wrong and time will reveal our folly.
Ok, analyst, are you able to advice all of us here based on Dow Jones or STI indexes, at which point should we enter or exit the property market?
When its time to enter the market, are developers going to have fire sales?
Every past recessions are different and this time round if someone from EDMW can spot a oncoming recession and yet US or S'pore govt scholars act as sitting duck, the world is doom
 

Solid_snape

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Ok, analyst, are you able to advice all of us here based on Dow Jones or STI indexes, at which point should we enter or exit the property market?
When its time to enter the market, are developers going to have fire sales?
Every past recessions are different and this time round if someone from EDMW can spot a oncoming recession and yet US or S'pore govt scholars act as sitting duck, the world is doom

Disclaimer: I’m a first timer in my early mid 30s looking for my first property and I was hoping that there would be convincing arguements as to why $1100psf for the Sumang Ec is fair as I too would love to take part in the dream of owning a luxury home, get rich, etc. But so far the only thing I’ve read is the optimism that “prices have gone up historically, hence they will continue going up.” That is a statement that is generally true, we need inflation and prices to go up for the economy to function.

However there is a reason why you don’t pay $500k for a Toyota, there has to be a fair value for everything. If there is actual justification that this is a good price to enter I would be more than happy to swallow my words and be first in line to queue on balloting day.
 

sft1393h

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Disclaimer: I’m a first timer in my early mid 30s looking for my first property and I was hoping that there would be convincing arguements as to why $1100psf for the Sumang Ec is fair as I too would love to take part in the dream of owning a luxury home, get rich, etc. But so far the only thing I’ve read is the optimism that “prices have gone up historically, hence they will continue going up.” That is a statement that is generally true, we need inflation and prices to go up for the economy to function.

However there is a reason why you don’t pay $500k for a Toyota, there has to be a fair value for everything. If there is actual justification that this is a good price to enter I would be more than happy to swallow my words and be first in line to queue on balloting day.
As long as govt din announce the massive increase of S'pore land area or stop the influx of new citizen from currently 5.6m to 6.9m, u r safe to go
 

darknite84

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Disclaimer: I’m a first timer in my early mid 30s looking for my first property and I was hoping that there would be convincing arguements as to why $1100psf for the Sumang Ec is fair as I too would love to take part in the dream of owning a luxury home, get rich, etc. But so far the only thing I’ve read is the optimism that “prices have gone up historically, hence they will continue going up.” That is a statement that is generally true, we need inflation and prices to go up for the economy to function.

However there is a reason why you don’t pay $500k for a Toyota, there has to be a fair value for everything. If there is actual justification that this is a good price to enter I would be more than happy to swallow my words and be first in line to queue on balloting day.

Unfortunately property has no fair value, due to a few factors,

1) the land price, developers are like bakers, if the flour they buy is expensive, the bread they sell will be expensive, if all bakers sells their bread expensive, there is nothing you can do, unless you want to bake your own bread
2) public confidence (property price is just a reflection of this confidence)
3) raising inflation, there is a fix cost of sand, cement, steel, copper that
is required, and with raising inflation, so is cost of constructions

While it is possible to somewhat factor in point 1 and 3, public confidence and government policies are hard to calculate..

In a normal environment, with no recession and decent stock market, property prices will naturally appreciate.. especially with population growth, which cannot be stopped
 
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annetyu

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Unfortunately property has no fair value, due to a few factors,

1) the land price, developers are like bakers, if the flour they buy is expensive, the bread they sell will be expensive, if all bakers sells their bread expensive, there is nothing you can do, unless you want to bake your own bread
2) public confidence (property price is just a reflection of this confidence)
3) raising inflation, there is a fix cost of sand, cement, steel, copper that
is required, and with raising inflation, so is cost of constructions

While it is possible to somewhat factor in point 1 and 3, public confidence and government policies are hard to calculate..

In a normal environment, with no recession and decent stock market, property prices will naturally appreciate.. especially with population growth, which cannot be stopped

Was the appreciation the past year and a half "natural"?

I'll be happy to be a property developer next time if I have more buyers like you, because I can bid the land at any high price and still sell out.

Anyway, my main point is, look at the resales around the area first. One of the many better options is Treasure Trove. Its fairly new, very near MRT and going for less than $1,100psf. If you buy sumang EC for $1,100, whats the potential for appreciation when compared to the other private condos now?
 

dnsfpl

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you forget another impt factor - lease

tt 2011, sm 2019

8 years is not long, but not short either
 

infernolord

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The recent years cooling measures already putting up alot of "stress" to developers. In the recent talk, developers gang up together to put pressure to govt to ease the stamp duty and LTV limitations.


Govt want to sell land space at a more "reasonable" price, developers must able to "survive" in order buy up more land from govt.


At some point, i feel easing might happen. Property market aint going down unless a crisis happened, financial tightening from bank. Even it is down, there are really alot of standby lookers with huge cash ready to go in.



Just look at 2016, over supply of EC, no one buying because everyone think it will drop more. (Drop only 3-5%) When EC price going up abit, everyone chiong. 2 years up (10-15%) and demand more than supply now...
 

darknite84

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The recent years cooling measures already putting up alot of "stress" to developers. In the recent talk, developers gang up together to put pressure to govt to ease the stamp duty and LTV limitations.


Govt want to sell land space at a more "reasonable" price, developers must able to "survive" in order buy up more land from govt.


At some point, i feel easing might happen. Property market aint going down unless a crisis happened, financial tightening from bank. Even it is down, there are really alot of standby lookers with huge cash ready to go in.



Just look at 2016, over supply of EC, no one buying because everyone think it will drop more. (Drop only 3-5%) When EC price going up abit, everyone chiong. 2 years up (10-15%) and demand more than supply now...


We had almost 8 rounds of cooling measures. Anytime it drops, gov can just loosen some of the tightening and it will spark a price increase
 

skizzer

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The recent years cooling measures already putting up alot of "stress" to developers. In the recent talk, developers gang up together to put pressure to govt to ease the stamp duty and LTV limitations.


Govt want to sell land space at a more "reasonable" price, developers must able to "survive" in order buy up more land from govt.


At some point, i feel easing might happen. Property market aint going down unless a crisis happened, financial tightening from bank. Even it is down, there are really alot of standby lookers with huge cash ready to go in.



Just look at 2016, over supply of EC, no one buying because everyone think it will drop more. (Drop only 3-5%) When EC price going up abit, everyone chiong. 2 years up (10-15%) and demand more than supply now...

Heng Swee keat just hinted REDAS don’t expect anything ytd. And u see the reason given by redas boss why cooling measures should be unwind is a joke.
 
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