For those who only own two properties (one invested and one own stay) and for whatever reason wish to move to another home might also not be good news. Existing might need to lower asking price and for new, need to incur higher ABSD, provided the drop in property price is more than offset the increase in ABSD. (Assuming that investment property is not suitable for own stay). Also, even for those who own one home who needs to upgrade, definitely needs to sell first. If not, provided the drop in new home prices is more than offset the increase in ABSD…
youtube i think calculates depending on day started, like 18th-17th if im not wrong. See this playlist and cya on the inside th-cam.com/play/UUMOQAp2EzcRv2wl09p88TBrGA.html
Media is partly responsible for the property hype, often reporting how profitable the property deals are by simply comparing the URA transacted prices which are misleading because this doesn’t take into account the transaction costs on buying and selling plus renovations which can be 5-10% of the property price. And Singapore banks are offering insanely low mortgage rates, as if borrowing money for almost free. The government’s cooling measures are slightly overdue, probably because of hesitation over Covid, but necessary.
Has any statistics been done to determine the percentage of first time home buyers for the past 1-2 years? If the bulk are first time home buyers, will this increase in ABSD result in moderation or drop in ppty prices?
@@joshconsultancy If that’s the case, then government is just barking at the wrong tree. Property price will continue to shoot up and we are killing off genuine foreign investors…
Overall I think it is a good move. In my opinion, prices have been rising unnaturally fast. If nothing is done, Singapore is going to become a city where only the super wealthy can afford to live.
Usually at the heart of the policy decision, it’s to protect common Singaporeans like us. In 1997 AFC, many lost big in property speculation when prices crashed
@@joshconsultancy using historical trend is inaccurate. wealth level now and back then is vastly different. The macro environment is also largely different e.g. wfh. where larger space is preferred and drive people towards HDB over Private housings.
I am 31 and have bought a resale condo as a bridge between now till 35 where i can get more housing options such as a HDB. I was intending to capitalize my purchase by collecting rental and capital gains. But right now, looks like I can only collect rent by staying with my parents. After this cooling measure has been implemented, i am not sure if my condo price will increase after the 3 years lock in is up. Any thoughts on this?
Interestig proposition "bridge between now till 35 where i can get more housing options such as a HDB. " I wont know if ogt appreciation or not. Best to be prudent and can hold until there is
No offence but I'd go direct to the point. It sounds like you have bought your condo without doing much homework. Generally, Singapore's rental market and property market are no longer as buoyant as in what I call "the good old days" of the '80s, '90s, and 2000 to 2011 or so. I was fortunate to have access to housing data that clearly show the annualised returns of property investment in Singapore is not fantastic. (I'm not a property agent and they usually won't show you such data.) Sometimes it could be just 1-2%. Those not so lucky have even made losses of 6 to 7-figures even after holding their properties for 10 long years. Even without doing much research, we can see that there have been frequent condo launches in the past few years. Gone are the days where you could get high appreciation of prices within 5 years. Expect a lot of slowdown. I'm personally not optimistic about the local property market, all the more so now that the government has introduced this recent cooling measures that hit hard at foreigners. Think about who will rent or buy your condo next time. There will also be many choices to pick from. The COVID pandemic adds an extra salt to the wound. The end is nowhere near. So time will tell how resilient the market can be. All it takes is for some financial crisis to occur and we could be seeing a large sell-off in the property market.
Condo downgrader will not like it for sure. TDSR adjustment will affect the next apartment buyer affordability and hence bring down resale price quantum. Even if a half mio HDB price will take a slight hit , the damage on a 1.5 mio condo to be sold will be significantly more affected in comparison..
The increase in ABSD basically killed the “property investment” strategy. The concept of buying a property to collect rent while waiting for the price to appreciate with substantial leveraging in a low interest regime has come to an end. While it’s still possible to invest in multiple properties and profit from it, the risk has substantially increased and capital appreciation upon TOP is no longer a sure thing. The government is basically telling everyone that Singapore Housing policy is targeted for own stay and not for speculative investment which does not generate as much economic value to the country as a whole versus other investment instruments. If property were to be part of one’s investment portfolio , perhaps REITs has better risk - return prospects and there are multiplier effects to the local economy as a whole as many of these REITs do generate income from both local and overseas businesses.
Totally agreed. A house is for your own living and not for speculative investments. I think govt is targeting this group of property buyers as they are pushing the prices too high for the normal Singaporeans who just come out to society to work. I think this group of people were rather selfish as they had gained much from the property market and does not care about the high prices which made a lot of youngest beyond the reach of owning a home...I stayed in Bishan and the prices had sky rocketed because of these people.. there were many people renovating aka new owners, even during the pandemic. I have no intention to sell as I not chasing those gains and also I feel that a house is for living, not for earning money.
Good point raised. Its now more of property speculation because rent can be forecasted and worked at but capital appreciation is a hope and not within control
@@whis5448 When it comes to money, be careful of what the rhetoric by policy makers vs self interest. From a policy maker pov, they want to push for a new mindset of house is for staying and not appreciating asset. BUT as an owner of a property that probably takes up 1/3 to 1/2 your networth, it is foolish to buy into the policymakers rhetoric. lemme explain. if you want your total networth to grow by 5% (excluding your incremental yearly savings from income flows), and 1/3 to 1/2 your total networth has zero appreciation, that means your other 2/3 to 1/2 of your networth needs to grow by 7.5% to 10%!!. On a long term basis, that is pretty darn difficult..... Don't be foolish. what is good for policymakers is not necessarily good for yourself.
@@ocswoodlands You have to consider the big picture and I don’t think it’s fair to say that policies are created with only monetary self interest in mind. Yes, property is a huge portion of a person’s assets and because of that, it can only appreciate ? Property can be a good store of value if you do not have a situation where prices are rising at a much faster pace than the real economic growth of the country. The risk of asset inflation leading to rapid and catastrophic collapse of the market will hurt everyone. So it’s all about financial prudence and a diversified and resilient portfolio is the way. I suggest you engage Josh to help you in your retirement planning.
i guess people never learn their lesson. stay away from singapore housing market all together, just dont play the game. the black swan for Singapore housing market is the government.
Who allow it. Those in power can make change but no. Giving grants because of higher price units. Than put rule and rules and rules. Like no credit card who will pay pump prices in petrol station Who allow it. RIP
mixed fortunes for me. I am a decoupled owner of an HDB flat. looking to sell and then buy a 3/4 bedder condo. guess I will sell lower and buy lower...
5th group of people Not happy.... Those with more than 1 residential property. Difficult to offload now. 6th group of people not happy... Property agents! Two years of 365 days working non stop. 😊 Time to relax now...... 7th group of people not happy.... Those in D9, 10, 11...... No more rich Ang moh buying .... 😁
If properties in D9/10/11 fall in price, so will the rest of Singapore. The market will correct itself, and there will not be a time where prime district properties become less pricey than those elsewhere. This has been the case from time immemorial. In fact the OCR RCR and CCR price gaps have already closed significantly, but they're called prime districts for a reason...
@@joshconsultancy yes, you are right. It now seem more like a middle class tax than for the top earners. They just dun want middle class to make it to the next tier.
Too often, I have heard property agents pushing residents to sell their HDB flats and buy condos because condos have a wider buyer pool, namely, foreigners, and hence, even if you price your condo at a very high price, "some foreigner" out there will likely buy it, unlike HDB flats. NOTHING COULD BE WORSE THAN THIS LIE! I think the recent cooling measure is a double-edged sword for those who have recently purchased condos. So while one may heave a sigh of relief at having already purchased a condo recently, just before this new cooling measure, be aware that you may likely face headwinds when trying to sell it away in the years to come. At 30% ABSD for foreigners, it's a lot less attractive for them to make a purchase from you. In addition, the pandemic is not looking to end soon. Rental of the condo will likely not be as buoyant as the pre-COVID days. I also don't agree with the video that the cooling measures will be good for those who wish to sell their HDB flats and buy condos. (You call it "upgrading" but I always feel it's a wrong term to use. It's really "downgrading".) First, depending on the price of the condo, I think it is tougher for one to now get a higher loan than before from the bank.This may prevent you from being able to buy a property that you desire. Second, it sounds promising if condo prices do fall slightly due to to cooling measures. But don't forget, so too will your HDB flat's asking price. You won't really benefit too much. Third, I feel the new cooling measures mainly affect those who wish to buy a second property, or multiple properties. If you are selling your property now to move into another, I don't think you will be largely affected, except for the first point above on the lowered MSR and TDSR. To end off, I feel many should wisely have done their own study of the property market in Singapore before jumping into whatever "upgrading" or "downgrading". Unfortunately, from the general sensing, I feel Singaporeans are often too lazy to do so and believe every word the property agents tell them. That is very dangerous. You are dealing with big hard-earned money on your part. Actually, property investing isn't as attractive as in the long past (think year 2005 and before that). Since the cooling measures were first introduced almost a decade ago, the returns have not been as high as in the good old days. In recent years, It has gotten worse. I'm always amazed to see how many people rush to buy condos in whatever new launches there are. There is a lot of liquidity in the market. BUT... THE BIG QUESTION IS, is it sustainable? Only time can tell.... (Personally, I am not optimistic about SG property market any more.)
For those who only own two properties (one invested and one own stay) and for whatever reason wish to move to another home might also not be good news. Existing might need to lower asking price and for new, need to incur higher ABSD, provided the drop in property price is more than offset the increase in ABSD. (Assuming that investment property is not suitable for own stay).
Also, even for those who own one home who needs to upgrade, definitely needs to sell first. If not, provided the drop in new home prices is more than offset the increase in ABSD…
Id be releasing more discussions on property on THE JOSH TAN SHOW - Subs and stay tuned there too! =) - th-cam.com/users/THEJOSHTANSHOW
As always, very educational, thanks for sharing,
Josh, what types of videos do you have in the members channel? And is it better to join on the 1st of the month to get the best value
youtube i think calculates depending on day started, like 18th-17th if im not wrong. See this playlist and cya on the inside th-cam.com/play/UUMOQAp2EzcRv2wl09p88TBrGA.html
Media is partly responsible for the property hype, often reporting how profitable the property deals are by simply comparing the URA transacted prices which are misleading because this doesn’t take into account the transaction costs on buying and selling plus renovations which can be 5-10% of the property price.
And Singapore banks are offering insanely low mortgage rates, as if borrowing money for almost free.
The government’s cooling measures are slightly overdue, probably because of hesitation over Covid, but necessary.
Good points raised
Has any statistics been done to determine the percentage of first time home buyers for the past 1-2 years? If the bulk are first time home buyers, will this increase in ABSD result in moderation or drop in ppty prices?
From the ground, very few locals are paying ABSD. All couples who can afford decouple to buy in 2 individual names
@@joshconsultancy
If that’s the case, then government is just barking at the wrong tree. Property price will continue to shoot up and we are killing off genuine foreign investors…
@@joshconsultancy what you are saying doesn't make sense. Lesser Number of people paying absd it actually means the measure is effective.
Could you comment on investing in commercial property to earn rental compared to second residential property, which will have high ABSD etc.?
CHeck this discussion Investing Into Commercial Property BETTER Than Buying REIT??? th-cam.com/video/_1iVtHtyPdA/w-d-xo.html
Any impact on REIT prices?
REITS are commercial. Think no correlation
Overall I think it is a good move. In my opinion, prices have been rising unnaturally fast. If nothing is done, Singapore is going to become a city where only the super wealthy can afford to live.
Usually at the heart of the policy decision, it’s to protect common Singaporeans like us. In 1997 AFC, many lost big in property speculation when prices crashed
@@joshconsultancy using historical trend is inaccurate. wealth level now and back then is vastly different. The macro environment is also largely different e.g. wfh. where larger space is preferred and drive people towards HDB over Private housings.
I am 31 and have bought a resale condo as a bridge between now till 35 where i can get more housing options such as a HDB. I was intending to capitalize my purchase by collecting rental and capital gains. But right now, looks like I can only collect rent by staying with my parents. After this cooling measure has been implemented, i am not sure if my condo price will increase after the 3 years lock in is up. Any thoughts on this?
Interestig proposition "bridge between now till 35 where i can get more housing options such as a HDB. " I wont know if ogt appreciation or not. Best to be prudent and can hold until there is
No offence but I'd go direct to the point. It sounds like you have bought your condo without doing much homework. Generally, Singapore's rental market and property market are no longer as buoyant as in what I call "the good old days" of the '80s, '90s, and 2000 to 2011 or so.
I was fortunate to have access to housing data that clearly show the annualised returns of property investment in Singapore is not fantastic. (I'm not a property agent and they usually won't show you such data.) Sometimes it could be just 1-2%. Those not so lucky have even made losses of 6 to 7-figures even after holding their properties for 10 long years.
Even without doing much research, we can see that there have been frequent condo launches in the past few years. Gone are the days where you could get high appreciation of prices within 5 years. Expect a lot of slowdown. I'm personally not optimistic about the local property market, all the more so now that the government has introduced this recent cooling measures that hit hard at foreigners. Think about who will rent or buy your condo next time. There will also be many choices to pick from.
The COVID pandemic adds an extra salt to the wound. The end is nowhere near. So time will tell how resilient the market can be. All it takes is for some financial crisis to occur and we could be seeing a large sell-off in the property market.
Hi josh do u think resale hdb market will drop in this way?
Actually I think it has little impact. Same as in scenario 1
Condo downgrader will not like it for sure. TDSR adjustment will affect the next apartment buyer affordability and hence bring down resale price quantum. Even if a half mio HDB price will take a slight hit , the damage on a 1.5 mio condo to be sold will be significantly more affected in comparison..
Noted on your POV. I was thinking from the shoes of someone who sold off the condo/ gotten the enbloc already
The increase in ABSD basically killed the “property investment” strategy. The concept of buying a property to collect rent while waiting for the price to appreciate with substantial leveraging in a low interest regime has come to an end. While it’s still possible to invest in multiple properties and profit from it, the risk has substantially increased and capital appreciation upon TOP is no longer a sure thing. The government is basically telling everyone that Singapore Housing policy is targeted for own stay and not for speculative investment which does not generate as much economic value to the country as a whole versus other investment instruments. If property were to be part of one’s investment portfolio , perhaps REITs has better risk - return prospects and there are multiplier effects to the local economy as a whole as many of these REITs do generate income from both local and overseas businesses.
Totally agreed. A house is for your own living and not for speculative investments. I think govt is targeting this group of property buyers as they are pushing the prices too high for the normal Singaporeans who just come out to society to work. I think this group of people were rather selfish as they had gained much from the property market and does not care about the high prices which made a lot of youngest beyond the reach of owning a home...I stayed in Bishan and the prices had sky rocketed because of these people.. there were many people renovating aka new owners, even during the pandemic. I have no intention to sell as I not chasing those gains and also I feel that a house is for living, not for earning money.
Good point raised. Its now more of property speculation because rent can be forecasted and worked at but capital appreciation is a hope and not within control
@@whis5448 When it comes to money, be careful of what the rhetoric by policy makers vs self interest.
From a policy maker pov, they want to push for a new mindset of house is for staying and not appreciating asset.
BUT as an owner of a property that probably takes up 1/3 to 1/2 your networth, it is foolish to buy into the policymakers rhetoric.
lemme explain.
if you want your total networth to grow by 5% (excluding your incremental yearly savings from income flows), and 1/3 to 1/2 your total networth has zero appreciation, that means your other 2/3 to 1/2 of your networth needs to grow by 7.5% to 10%!!. On a long term basis, that is pretty darn difficult.....
Don't be foolish. what is good for policymakers is not necessarily good for yourself.
@@ocswoodlands You have to consider the big picture and I don’t think it’s fair to say that policies are created with only monetary self interest in mind. Yes, property is a huge portion of a person’s assets and because of that, it can only appreciate ? Property can be a good store of value if you do not have a situation where prices are rising at a much faster pace than the real economic growth of the country. The risk of asset inflation leading to rapid and catastrophic collapse of the market will hurt everyone. So it’s all about financial prudence and a diversified and resilient portfolio is the way. I suggest you engage Josh to help you in your retirement planning.
the biggest winner is SG government.
How many rounds of property cooling measures have we seen? Did the price ever come down? No, it just keeps going up.
It does. Just a few rounds haha. 2013, good case study
@@joshconsultancy Let's see, anyway thanks for sharing.
i guess people never learn their lesson.
stay away from singapore housing market all together, just dont play the game.
the black swan for Singapore housing market is the government.
Gov is cooling the market for long term stability. It’s good isn’t it?
Who allow it. Those in power can make change but no. Giving grants because of higher price units. Than put rule and rules and rules. Like no credit card who will pay pump prices in petrol station
Who allow it. RIP
mixed fortunes for me.
I am a decoupled owner of an HDB flat. looking to sell and then buy a 3/4 bedder condo.
guess I will sell lower and buy lower...
Decoupling, the motivation is to own two in the family isn’t it?
5th group of people Not happy.... Those with more than 1 residential property. Difficult to offload now.
6th group of people not happy... Property agents!
Two years of 365 days working non stop. 😊 Time to relax now......
7th group of people not happy.... Those in D9, 10, 11...... No more rich Ang moh buying .... 😁
Oh ya property agents. But they are creative also. Good agents will adapt and still do well
If properties in D9/10/11 fall in price, so will the rest of Singapore. The market will correct itself, and there will not be a time where prime district properties become less pricey than those elsewhere. This has been the case from time immemorial. In fact the OCR RCR and CCR price gaps have already closed significantly, but they're called prime districts for a reason...
It is mainly to curb foreigners from making our country more expensive than it should.
Thats one part of the equation only and as shown, around 4% only
@@joshconsultancy yes, you are right. It now seem more like a middle class tax than for the top earners. They just dun want middle class to make it to the next tier.
看到鬼？
another group are rich singles thinking buying 2nd property 😫😫😫😫
Very rare. From my circle they trade up in size not get two
Too often, I have heard property agents pushing residents to sell their HDB flats and buy condos because condos have a wider buyer pool, namely, foreigners, and hence, even if you price your condo at a very high price, "some foreigner" out there will likely buy it, unlike HDB flats. NOTHING COULD BE WORSE THAN THIS LIE!
I think the recent cooling measure is a double-edged sword for those who have recently purchased condos. So while one may heave a sigh of relief at having already purchased a condo recently, just before this new cooling measure, be aware that you may likely face headwinds when trying to sell it away in the years to come. At 30% ABSD for foreigners, it's a lot less attractive for them to make a purchase from you.
In addition, the pandemic is not looking to end soon. Rental of the condo will likely not be as buoyant as the pre-COVID days.
I also don't agree with the video that the cooling measures will be good for those who wish to sell their HDB flats and buy condos. (You call it "upgrading" but I always feel it's a wrong term to use. It's really "downgrading".)
First, depending on the price of the condo, I think it is tougher for one to now get a higher loan than before from the bank.This may prevent you from being able to buy a property that you desire.
Second, it sounds promising if condo prices do fall slightly due to to cooling measures. But don't forget, so too will your HDB flat's asking price. You won't really benefit too much.
Third, I feel the new cooling measures mainly affect those who wish to buy a second property, or multiple properties. If you are selling your property now to move into another, I don't think you will be largely affected, except for the first point above on the lowered MSR and TDSR.
To end off, I feel many should wisely have done their own study of the property market in Singapore before jumping into whatever "upgrading" or "downgrading". Unfortunately, from the general sensing, I feel Singaporeans are often too lazy to do so and believe every word the property agents tell them. That is very dangerous. You are dealing with big hard-earned money on your part.
Actually, property investing isn't as attractive as in the long past (think year 2005 and before that). Since the cooling measures were first introduced almost a decade ago, the returns have not been as high as in the good old days. In recent years, It has gotten worse. I'm always amazed to see how many people rush to buy condos in whatever new launches there are. There is a lot of liquidity in the market. BUT... THE BIG QUESTION IS, is it sustainable?
Only time can tell....
(Personally, I am not optimistic about SG property market any more.)
Good sharing. More should see