Which Direction Will Property Prices Go ?

arctician

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If earning or free cash flow increases in the next few quarters for many quality companies, valuation will become cheap. ;)
personally i prefer high quality value over growth stocks now, if i remember in march there was a rotation towards value stocks in US as tech stocks are dependent on future earnings and cash flow which is worth less if interest rate rise. Now i just put everything into quality SG REITs at good valutions, every month just do DCA
 

holasingapura

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Not exactly true. Key diff between property & stock is that property is leveraged.
It is very easy to trade on leverage with stocks too.

Key difference is that property is less volatile and less likely to get margin calls. Thats why I say sinkies and generally humans are risk-adverse. Thats fine, if not everyone will be making millions in stocks and coins.
 

Passerboy

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It is very easy to trade on leverage with stocks too.

Key difference is that property is less volatile and less likely to get margin calls. Thats why I say sinkies and generally humans are risk-adverse. Thats fine, if not everyone will be making millions in stocks and coins.
Additional point is while u can leverage with stocks the interest or “pitfall” is higher.
 

scanner007

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personally i prefer high quality value over growth stocks now, if i remember in march there was a rotation towards value stocks in US as tech stocks are dependent on future earnings and cash flow which is worth less if interest rate rise. Now i just put everything into quality SG REITs at good valutions, every month just do DCA
To each, it’s own. Lol
Amazon, Salesforce are few good examples. As long as our investment meets our needs. All is good.
 

holasingapura

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Additional point is while u can leverage with stocks the interest or “pitfall” is higher.
Exactly. That is why property is the one of the simplest form of investment.

And one passing question for you.... Would prefer to...

1. Afford 3 investment properties and collect 3x rental income. Prices appreciate slowly. Enjoy life with quarterly overseas trip.
or
2. Own 1 investment property and have its value double in 15 years. Slog throughout your life and live from paycheck to paycheck.

Just keeping your euphoria in check.
 

arctician

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To each, it’s own. Lol
Amazon, Salesforce are few good examples. As long as our investment meets our needs. All is good.
true also. thats why real estate is preferred by some for lower volatility, one will need lots of courage to have 90% of your networth in Equities. but not sure why it became comparatively OK if its real estate.
 

Passerboy

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Exactly. That is why property is the one of the simplest form of investment.

And one passing question for you.... Would prefer to...

1. Afford 3 investment properties and collect 3x rental income. Prices appreciate slowly. Enjoy life with quarterly overseas trip.
or
2. Own 1 investment property and have its value double in 15 years. Slog throughout your life and live from paycheck to paycheck.

Just keeping your euphoria in check.
Why number 1, don’t need to slog? Then where does he get the capital to afford the 3 investment property?
 

holasingapura

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Why number 1, don’t need to slog? Then where does he get the capital to afford the 3 investment property?
Don't need to slog because prices lower due to very slow appreciation in case 1. Your income rises faster than property prices, not the other way round.

Just a hypothetical situation. Anyway, hard for ordinary young sinkies to achieve number 1 today because too many sinkies are competing to be landlords.
 
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Passerboy

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Don't need to slog because prices lower due to very slow appreciation in case 1. Your income rises faster than property prices, not the other way round.

Just a hypothetical situation. Anyway, hard for ordinary young sinkies to achieve number 1 today because too many sinkies are competing to be landlords.
But u own 3 properties instead of 1, with ABSD and all it should hit equally hard as option 2.

though I say option 1 is better.
 

holasingapura

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But u own 3 properties instead of 1, with ABSD and all it should hit equally hard as option 2.

though I say option 1 is better.
If prices appreciated gradually, govt would not have imposed today's ABSD?

Anyhow, good that you are aware option 1 is better. Unfortunately, this was easier for our elders to achieve. e.g. one of our senior expert panel member has 3 or 4 properties - I do not think he has a top tier income. Oh, as I write about him, you can easily avoid the ABSD for additional 3 properties, pls consult him! But perhaps it will be tougher if you are single.

For now, happy living with option 2! Up, up and away - as you love it!
 

Passerboy

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If prices appreciated gradually, govt would not have imposed today's ABSD?

Anyhow, good that you are aware option 1 is better. Unfortunately, this was easier for our elders to achieve. e.g. one of our senior expert panel member has 3 or 4 properties - I do not think he has a top tier income. Oh, as I write about him, you can easily avoid the ABSD for additional 3 properties, pls consult him! But perhaps it will be tougher if you are single.

For now, happy living with option 2! Up, up and away - as you love it!
Haha working towards Option 1, up up and away!

but I think either options need to slog abit or look out for hyper growth stocks.
 

scanner007

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true also. thats why real estate is preferred by some for lower volatility, one will need lots of courage to have 90% of your networth in Equities. but not sure why it became comparatively OK if its real estate.
Remember most equities play is tax free.
In US, capital gain is tax free but they tax on dividend.
SG, HK, Malaysia it is totally free.

Property rental need to be taxed. You still need to pay for property tax, mcst, etc. ;)
 

Entity

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Do you have any recent cases where investors can flip and sell witin 3 years- TOP for that kind of profit - is it still possible now with SSD and assuming you have to take a bank loan ? I know it was possible in the early 2010s but how do you do that now?
Just some cherry picking:
https://ibb.co/09xmX4G
~157k down payment with BSD/fees and 152k gains (almost 100% gain, but of cos without interest costs and other fees considered) in about 3.6years, >20%CAGR
https://ibb.co/hKJ9hRs
About the same period, S&P500 went up 50%, about 11%CAGR

https://ibb.co/Qj4xy0Y
~520k down payment with BSD/fees and 575k gains in about 4.8years, ~17%CAGR
https://ibb.co/JpGgGxV
Same period, S&P500 doubled, about 15%CAGR

Ok la not exactly 3 years but still, very good gains. I think someone shared that about 60% of the new launches were profitable in this period, thus making these kind of gains not that easy to come by, maybe top 10 percentile? Whereas the S&P 500 involves no stock picking

I think the key is diversification. Personally, have stocks too, but liquidated a portion to divert into property investment back in 2018.
Personally with my limited income capacity, 50:50 diversification in property:stocks is impossible, but can be a consideration for those better off

For me its less of an investment, when one has enough, quality of life takes over financial metrics like yield and ROE
Yup, there is that consideration too. But personally feel there needs to be a balance to this though, and not stretch it. Ultimately if I am staying in it, it is kind of an operating expense
 

arctician

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Remember most equities play is tax free.
In US, capital gain is tax free but they tax on dividend.
SG, HK, Malaysia it is totally free.

Property rental need to be taxed. You still need to pay for property tax, mcst, etc. ;)
precisely most mrakets dont have capital gain and income tax yet locals prefer real estate though we need to pay income tax, property tax, maintenance etc. Its probably due to lower volatity and leverage.
 

kpkb

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precisely most mrakets dont have capital gain and income tax yet locals prefer real estate though we need to pay income tax, property tax, maintenance etc. Its probably due to lower volatity and leverage.
Properties is a physical asset you can stay in, rent out, share memories with family and friends, even if value drops, it will not disappear (unless building collapses). Stocks and bonds become worthless paper if company goes belly up like the Hyflux case. So taking big loans for a physical useable asset is definitely safer than loaning to buy stocks. Properties will always have strong appeal.
 

Eternit

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I think when comparing gains from stocks and properties, you also need to consider that property is also a necessity for living. Suppose both your stock and property gain 100K each, you can sell your stock and net 100K, but if you sell your house you also need to fork out money to buy/rent another place to stay (applicable if you only got 1 property)
 

1993newbie

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HDB Resale Prices Continue Rising for Ten Straight Months in April 2021; Year-on-Year Prices Increase 10.8%​

  • Year-on-year, the overall price increase is 10.8%.
  • Year-on-year, prices for all room types increase in April 2021: 3 Room by 13.5%, 4 Room by 10.4%, 5 Room by 9.1% and Executive by 10.8%.
  • Mature and Non-Mature Estates prices increase by 9.4% and 11.8% respectively from a year ago.
  • April 2021 prices are 3.7% lower than the peak in April 2013.

 

Passerboy

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HDB Resale Prices Continue Rising for Ten Straight Months in April 2021; Year-on-Year Prices Increase 10.8%​

  • Year-on-year, the overall price increase is 10.8%.
  • Year-on-year, prices for all room types increase in April 2021: 3 Room by 13.5%, 4 Room by 10.4%, 5 Room by 9.1% and Executive by 10.8%.
  • Mature and Non-Mature Estates prices increase by 9.4% and 11.8% respectively from a year ago.
  • April 2021 prices are 3.7% lower than the peak in April 2013.

The psf of the resale HDB transacted are now on par with EC prices three years ago and very close to new launch EC prices.
 
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