Tags: shoebox / shoeboxes

The smaller the unit, the cheaper the rent? Not necessary so!

- August 10, 2014 No Comments

Rental for shoebox units are not necessarily cheaper than small apartments (i.e. those above 500sqft) within the same development. This is according to rental data from URA.

 

As an example, one can rent a shoebox unit of 300 - 400sqft at Alexis for between $3,200 to $3,500 per month. However, he can actually get a larger unit in the same development for around the same amount of rental.

 

The same scenario are currently being played out in other developments around Singapore as well.

 

The higher rental yield and per square feet (psf) rental commanded by shoebox units tend to be the market norm. In general, psf rental for small apartments are about $1 higher than those of medium and larger-sized units. For shoeboxes, the difference can be up to $3 higher. The overall average rental at Alexis, for example, is $4.90psf. However, average rental for units that are 600sqft or smaller is as high as $7.30psf.

But given the current depressed rental market, the difference in asking rent between shoeboxes and their larger counterparts are becoming smaller. As such, owner of shoeboxes are finding it increasingly challenging to rent out their units. Some savvy tenants have resorted to renting larger apartments and sub-letting one or two bedrooms in order to subsidize their rental cost. This has resulted in a larger number of empty shoebox units.

 

And the situation may be getting worse. About 10,000 new shoebox units are expected to be completed from 2014 to 2017.  Going forward, property consultants say that rental for shoebox units may likely fall between 10 - 15%.

Looks like stormy seas ahead for shoebox investors seeking rental...

 

Tags: misc

Our wishes for Singapore on its 49th Birthday!

- August 9, 2014 No Comments

As we celebrate the birth of our nation today, the wife and I will like to share our "birthday wishes" as Singaporeturns 49 (operative word here being "OUR", which may not necessarily concur with everyone else's):

 

1. Do the LABB

LABB, which is our acronym for "Let Able Buyers Buy". We are not seeking a total removal of ABSD for Singaporeans buying a second private property. But with the TDSR already showing its "teeth" in restraining buyers from overstretching themselves financially and SSD putting a curb on speculative activities, maybe the government can consider reducing the ABSD from the current 7% to say, 3%?

 

 

2. Upsize the shoebox

The government had already tried to manage the proportion of shoebox units in suburban areas by insisting an average unit size of 70sqm gross floor area for new developments. We say let's do one better by putting a minimum size requirement for all "small format" units and set this at, say 400sqft. With the demand for such unit type waning in both the sales and rental fronts, we are probably already in an excess supply situation. Maybe buyers and tenants have finally realised that a space of around 300sqft (some even less) is really a tad too small? 

 

 

3. "Learn the xylophone" campaign

Given our nation's love for "campaigns", let us add this one to our list. The music from the xylophones are sure to sound better than those xenophobic trumpets, and if we gather enough xylophonist, we make may just be loud enough to drown out them "xenophonist".

4. Strengthen our MRT, not just the SAF
While residential projects near/next to a MRT station is still a big draw, this notion is increasingly being challenged these days with the more-than-frequent train break-downs. Although the occasional "walking tour of our MRT train tunnels" sounds fun, it may not be so once this becomes a regular chore. So if the one-point-something million fine that the government had imposed so far is no deterrent enough, maybe we can consider increasing this to, say 10 million?


5. Better water/glass proofing at our Shopping Malls
And we aren't talking about those old and dilapidated ones rather the glittering (literally speaking, from water and glass fragments) new mega malls that have commenced business recently. While an interior water fountain may be an attraction, a "waterfall" from bursting water pipes is not. Same goes with shattering glass roofs or doors. And speaking of glass door, this is meant to keep the air-conditioning in and not as a form of amusement for toddlers - we sure hope that parents with young children can keep this in mind.

Tags: announcements / misc

Our very first collaboration with PropertyGuru!

- August 8, 2014 2 Comments

The good folks at The PropertyGuru have decided to publish one of our recent article in their fortnightly newspaper which hit the streets today.

The collaboration represents the first time since the inception of SG Proptalk that we have been featured outside of the internet realm. Now that we have finally "come out", will this lead to more magazine/newspaper editors knocking at our door? The wife and I can always hope!

The PropertyGuru newspaper is Singapore's only property dedicated newspaper distributed on a complimentary basis. New issue of the newspaper is published fortnightly and available on Friday at various locations including downtown and suburban shopping belts, selected MRT vicinities and most petrol kiosks islandwide.

So do pick up your free copy from today!

Tags: fernvale / gls / sengkang

Lukewarm response to latest URA land tender

- August 7, 2014 No Comments

Two plots of land for residential development at Fernvale Road have attracted lukewarm response from developers at the close of tender on Thursday (Aug 7).

 

The two adjacent plots were put up for sale on June 26 under the batch tender closing system, which is aimed at ensuring more prudent bids from developers.
 

The Urban Redevelopment Authority (URA) said Land Parcel A has attracted four bids. The top bid for Parcel A came from CEL Development and Unique Residence at $234.9 million. It is a joint venture led by Chip Eng Leong Development. The 99-year leasehold site measures about 16,604 square metres.

 

 

 

Meanwhile, Land Parcel B has received three offers, with the top bid also coming from CEL Development and Unique Residence at $252.1 million. This plot has a site area of about 17,414 square metres.

The top bids for both land parcels work out to a weighted average land price of $443.38 per square feet per plot ratio (psf ppr) and the break-even cost is estimated to range from $850 to $890 psf. The two adjacent plots were put up for sale on June 26 under the batch tender closing system, which is aimed at ensuring more prudent bids from developers.

SLP International Property Consultants Executive Director for Research and Consultancy Nicholas Mak said in a statement: "Altogether, the two sites at Fernvale Road can potentially add a large number of housing units, around 1,100 to 1,200 units, to the supply. This will create a large influx of residential supply in the neighbourhood. Hence, the developments on Parcels A and B may take a longer time to sell all their units."

URA said it will announce its decision on the tender award at a later date. 

Source: CNA

 

So it looked like developers are definitely more cautious when come to bidding of land parcels these days. The wife and I did some checking and found that the average land price for this combined parcels is lower than the land prices of nearby residential parcels sold to developers last year. The site of Riverbank @Fernvale went for $489psf ppr and the Rivertrees Residences plot fetched $533psf ppr.

 

We wonder if this is likely to be the trend for the short to medium term, i.e. fewer bidders coming in with more conservative bids for suburban plots. This is because of the deluge of new private homes expected in the suburban regions over the 1 - 2 years.

 

 

 

 

 

Tags: rental

Rental yields rebound, but hold that bubbly!

- 2 Comments

Gross rental yields of private condos have rebounded in the first half of 2014 in all regions across Singapore, after having slid since 2009. This is due to resale prices falling at a faster rate than rents.

 

However, market watcher say this rebound is likely to be a blip, given that the leasing market continues to soften and vacancy rates are rising.

 

Gross rental yields in the north-east region of Singaporeled the recovery, up from 3.73% last year to 4.03%. The smallest improvement was registered in the central area, with yields increasing to 3.39% from 3.37% last year.

 

Topping the list of planning areas with the highest rental yields are Ang Mo Kio and Yishun, with gross rental yields of around 4.2%. Six planning areas attracted rental yields of more than 4%. The lowest-yielding areas are the prime locations, with homes in Orchard area attracted the lowest gross rental yield of 2.7%.

 

 

But the dynamic could shift with huge supply of completed condos coming onstream, mainly in the suburbs. The significant supply of units expected to enter the rental market during this year and next also comes at a time when expatriate hiring and leasing demand has moderated. Thus rental yields in the suburban market may weaken again if suburban rents fall faster than capital values.

 

Rising vacancy rates and difficulty in securing tenants are already weighing on the minds of investors, who typically want to invest in a property that can generate net positive cash flow on a stable and sustainable basis. And their property purchase will have to take into account of borrowing costs, operating expenses and property tax into their property purchase.

 

URA data shows that vacancy rate island-wide has spiked to 8.3% in Q2 2014 - higher than the 7.3% during the third quarter of the 2009 recession year.

 

With buyers more driven by appreciation than by gross rental yields, the slight improvement in yields is unlikely to influence their buying decisions. Investors are also more inclined to assume higher vacancy risks when prices fall substantially.

Info source: BT

 

So our local condos that will easily set you back more than a million dollars are currently averaging less than 4% in gross rental yields. And the yields (miserly as is) are expected to fall even further come next year. Then there is the double whammy of all the restrictions imposed on local property investment. Given such, can one really fault Singaporean investors for "looking outwards" (where purchase quantum are smaller and expected rental yields are higher) in search of better returns for their dollars, despite MAS harping about the added risks associated with such foreign property investments?

 

Tags: misc

Key considerations when buying into an older development

- August 6, 2014 No Comments

So you are on a budget and desire a home with an interior living space that is much larger than what the new condominium projects can offer these days. Your current option, other than moving to Iskandar, is to look at apartments in an older development.

By "older", the wife and I are talking about developments that are at least 10 years old. For those that really crave for space, this is not so much a "choice" rather than a "requirement". There are few options, for example, for a 3-bedroom apartments of at least 1,600sqft that was built before 2004 (as far as we know anyway). And if you only want to consider those that come with no bay windows and planter boxes, you probably would have to go further back than 10 years!

 

Now that we have established that your best bet is with older apartments, what are some of the key considerations that you will have to take before buying into that older development?

 

1.     Number of years remaining (for leasehold condos)

You may want to reconsider on that leasehold condo if it currently has 60 (or fewer) years on its land lease. This is because should you need to resell your unit, it will be a tad challenging as many buyers still frown upon old developments with less than 60 years of lease remaining.  

 

2.     General upkeep of the estate

This is especially important for older developments. Other than keeping a wide-eye on the general cleanliness around the estate and whether the greeneries within are properly maintained, you may also want to inquire about when the estate was last repainted and when was the last time the lifts (especially for high-rise developments) were upgraded. All these will have a direct impact on the maintenance and sinking funds of the development, which will ultimately affect your purse. 

 

3.     Maintenance/Sinking funds

It may be prudent to ask how much the estate has in terms of maintenance/sinking funds. This tells you how financially adequate the estate is currently and more importantly, whether you need to be around during the next AGM to vote on any proposed increase in the maintenance/sinking fund contribution. And by knowing whether an estate repainting or lift upgrading exercise is round the corner, this gives you further idea on whether more money is needed from each household vis-à-vis the current amount of funds that the estate has. 

 

4.     Your immediate neighbours

While it is normally a case of "what you moved-into is what you get" for brand new developments, you can typically make "informed decisions" about your neighbours when you buy into an older estate. If you are a sucker for tidiness and you see tons of shoes and other knick knacks lying all over the outside of your immediate neighbours' home, you have to then decide if you can live with that mess whenever you step out of the lift coming home. The wife and I will also advice for you to make at least 2 visitsto the apartment before you make that purchase decision - once during the day over a weekend and once on a weekday evening (say, between 7 to 8pm, when all the school-going kids have come home). This will give you a true indication of the noise levels generated by your immediate neighbours, especially the family that lives on top of you. Doing so may save you from another "Everitt Road" type of incident. 

 

5.     Any impending/on-going collective sale activity?

Some people will deliberately buy into an estate when they hear that it is preparing to go en-bloc. But if you are really buying to stay, the last thing you need is to spend time and money completing that ideal renovation, move into your new home and then realise that 80% of your neighbours are ready to sell-out within the next 12 months! 

 

6.     Plot ratio and building restrictions

As potential new owners, question about plot ratio and building restrictions may be the last thing on your mind. But we deem it important to have some idea of how "marketable" your estate is when comes to collective sale before you consider buying into it. Even if this does not happen anytime soon, the likelihood persists simply because the estate is... well... old.   

 

 

The above considerations may be elementary to some of you. Please bear with us if this is so. And if you have anything else to add to our list, we be most happy to hear from you!

 

 

 

Tags: misc / private home sales

HDB prices cannot drop more than private home prices?

- August 5, 2014 No Comments

Someone said in a recent discussion within the "Comment" section of our blog that it is unlikely for HDB prices to drop more (in % terms) than private home prices if the property market crashes. To which, the wife and I responded that we will not discount totally that HDB prices may drop more % wise but we were unable to quote actual historical data then to substantiate our claim. This is because we have not been keeping up with developments on the HDB price front.

 

Given that today is a "slow news day", the wife and I decided to do some homework on the subject. We did not have to go back too far in time to affirm our belief: 

• The private residential index for non-landed properties fell 1.3% in Q1 2014 from Q4 2013. The was followed by a further drop of 1.1% in Q2 2014 from Q1 2014.

 

• The HDB resale price index registered a 1.6% decline in Q1 2014. This was followed by a further 1.3% drop in Q2 2014. The fall in price was across all 3 to 5-room property types over the 2 quarters.

 

• According to one market expert, private property prices are expected to drop 3% in the second half of the year to bring about a correction of 5% in 2014.

 

• With HDB prices, the same expert expects a similar drop of 3% for the second half of 2014, giving a total decline of 6 - 8% for the whole of 2014.

Actual market data have shown that HDB prices had indeed fallen sharper than private home prices for the past 2 consecutive quarters. While we are not anywhere near a "market crash" yet, we cannot eliminate the possibility of HDB prices dropping more than their private counterparts if market do fall sharply.

 

 

 

Tags: ABSD / cooling measures

Minister Khaw: Not time yet to relax property cooling measures...

- August 4, 2014 No Comments

Existing concessions are already in place for those looking to upgrade their properties, and these are "reasonable and sufficient", said Minister for National Development Khaw Boon Wan on Monday (Aug 4).

MP Foo Mee Har asked in Parliament on Monday if the Government will consider relaxing some property cooling measure such as those relating to Additional Buyer's Stamp Duty so Singaporeans who meet the total debt obligation cap of 60% can upgrade their properties while remaining financially prudent.

In response, Mr Khaw said: "The property market cooling measures are intended to keep our housing market stable and sustainable. They aim to encourage financial prudence among home-buyers and moderate property prices.

"Various concessions are already in place to benefit upgraders. The existing concessions are reasonable and sufficient. Any move to relax the cooling measures, including broadening these concessions, is premature under market conditions."

The minister said such a move could lead to an upswing in demand, which would increase the number of transactions and raise housing prices. "This would not be welcome to Singaporean home-buyers, particularly those with aspirations to upgrade," Mr Khaw added.

Source: CNA

 

Call us ignorant but can someone enlighten us on the "various concessions" that are already in place to benefit upgraders please?  The only one that the wife and I are aware of is the refund on Additional Buyer's Stamp Duty for married couples if they sell their existing home within a stipulated period after the purchase of their new home...

Update (Aug 5th):   Here's one more "concession" that we read about today - an upgrader may qualify for the highest loan-to-value limit of 80% on his second loan if he is able to provide documents to his bank to show that he will be selling his existing home. However, there is no mention of  what the "grace period" is (6 month?) and what happen if the upgrader is unable to find a buyer at the end of the grace period.

Tags: d10 / leasehold / mon jervois / SingLand

Mon Jervois (Review)

- August 3, 2014 No Comments

Some of you may have taken a double-take and we won't blame you. After all, this is the first review that we have written for almost two-and-half years! The wife and I had to go back over 300 blog-posts before we found our last review - of Watertown in Punggol - that we did back in Feb 14, 2012.

So let's see if we still got what it takes...

Mon Jervois is not (strictly speaking) a "new" project : The wife and I was told that the project had previewed about a year ago but was not marketed aggressively thereafter, probably because of poor marketing sentiments.

 

The sales gallery of Mon Jervois, which apparently was renovated recently and re-opened in May this year, is located next to 87 Zion Road. If you are traveling along Ganges Road towards Havelock Road, be prepared to turn into this small slip road (we forgot to note the name, sorry) on your left just before you hit the Havelock Road junction else you will drive right pass it.

 

 

Mon Jervois (the actual development) is located on Jervois Road within District 10 (i.e. the "correct" side of the canal, else it becomes District 3, which is considered less "prime" based on traditional norm). It is nestled within a cluster of private (and primarily freehold) residential developments, and across from the Good Class Bungalows (GCB) area at Chatsworth Park.

The wife and I have always liked the tranquillity around the area, without being too far away from the convenience and bustle of the city. The shopping and dining in Orchard Road/River Valley are only minutes' drive away and if one works within the CBD, you have the option of either a short drive or taking the train - we were told that the Redhill MRT station is a mere 7 minutes' walk away - this was supposedly confirmed by one of the market agent who actually did the legwork.

 

But unlikely most of your immediate neighbours, Mon Jervois is a leasehold development. The project consists of 5 low-rise (5 storeys) blocks of 109 units. The apartment configurations range from 1- to 4-bedroom apartments.

 

The first thing that the wife and I were pleasantly surprised to discover was that there are actually quite a few more parking lots (135, including 3 handicapped lots) than units at Mon Jervois. This will at least allow SOME of the residents to park their second car within the estate and maybe offer a few parking spaces for visitors, which is going to be especially useful - we will come to this in awhile. 

 

The land parcel that Mon Jervois sits on was acquired by SingLand in February 2012 via a government land sales (GLS) exercise. SingLand purportedly paid $118.9 million for the land, which worked out to be around $862psf ppr. And just to provide you with some perspective, the current asking price for a unit in Mon Jervois is in excess of $1,900psf!

 

For those of you who are not familiar with SingLand, they are the same developer that are responsible for projects like Trizon,  Thomson Three and Alex Residences.

 

 

For the kind of money that Mon Jervois is asking, one can reasonably expect (and get) full facilities within the development. The usual "bells and whistles" exist but the one thing that caught our eyes was the entertainment pavilion with its triangular canopy roof. This area can cater to a party of 8 - 10 people and is equipped with everything you need (fridge, cooker, dining table and chairs etc.) to cook and serve up a great party.

 

So even if your dining room is a tad small (we will also come back to this later), you will at least have the option to host your dinner event here, where all your guests won't be rubbing shoulders with each other... literally. But the #1 problem the wife and I have with alfresco dining is that it is typically a "sweaty affair" with the kind of weather we get in Singapore. So we sure hope that the entertainment pavilion will provide sufficient ceiling fans.

 

 

There was only one showflat type on display - a 3-bedroom (Type C3) unit. The size of this unit type is 1,389sqft, but with 2 sets of balconies (PES), we reckon the interior living area is probably a tad under 1,300sqft.

The living and dining area is a "straight through" rectangle so there is no real separation between the two areas. Trying to fit a 6-seater table into the dining area is likely to be a challenge (and here's where the "entertainment pavilion" comes in handy). Even with the 4-seater round table on display, the wife and I were scratching our heads over how to manoeuvre a set of 3+2 sofa in the living room to accommodate a TV console. But we like the good quality marble flooring that are provided in the living/dining area.

The kitchen is decent-sized and comes equipped with high-end "Miele" appliances. But you do not get the dish-dryer you see in the photo. There are two entrances into the kitchen - one as you enter through the main door and the other from the dining area - with swing doors at both ends.

What we especially liked about the kitchen is that the cooking hood/hob are positioned at the end and next to the yard area. This allows for better ventilation for all the smoke and smell generated when you are doing heavy cooking.  

The yard area houses the washer & drying (provided) and a utility room plus bathroom. We were unable to get photos of the yard area but it looked decent enough in size to do your laundry/ironing. The utility room and bathroom are a tad small but within the norm of most new apartments these days.

 

The bedrooms are again typical of the size you get with new development these days. We reckon a super-single bed will probably be your best bet in the common bedrooms while you may wish to consider a queen-sized bed in the Master bedroom. This is assuming you do want some walking spaces around the rooms.

 

The bedrooms all come with parquet flooring, which again looked to be of pretty decent quality.

 

 

Both the common and Master bathrooms are decked with good-quality homogenous tiles and premium fittings from "Hansgrohe" and "Laufen". The Master bathroom is rather spacious and we especially liked the concept of having the standing shower next to the bathtub, which save space, as opposed to having a separate shower cubicle. 

Overall speaking, the wife and I were rather pleased with the 3-bedder layout. The unit felt more spacious than the 1,300sqft that it is supposed to be. The high ceiling probably helped - the showflat has ceiling height of 4.7metres, which is what you get for the ground-floor units. The typical ceiling height for apartments on higher floors are 3.3metres.

 

The 3-bedroom apartments are available in all the blocks within Mon Jervois except Block 47. But we felt that the best 3-bedder stack is located in Block 45 - this stack faces inward towards the swimming pool. And the stack even comes with an auspicious house number - 18. Huat ah!

 

 

What we like: 

1)      The location, which is tranquil yet not "ulu". 

2)      There are more parking lots than units - if you are familiar with that stretch of Jervois Road you will appreciate what we mean. Street parking is a big challenge both for residents with multiple cars and for visitors who drive.  

3)      The good layout of the 3-bedroom apartment, and the quality of the furnishings and fittings provided within. 

What we "do not quite" like: 

1)      The $1,900+sqft price tag is a tad steep, especially for  99-year leasehold development, albeit this being in District 10. The 3-bedder will cost you in excess of $2.65 million. 

2)      And speaking of leasehold, we cannot help but wonder how well the prices (not to mention self-esteem of owners) at Mon Jervois will hold against its immediate neighbours like Jervois Regency, Jervois Gardens, Jervois Lodge, Jervois Ville or Dormer Park - most of which are smaller and older developments but all of freehold tenure.   

3)      We are only identify one primary school - the newly installed Alexandra Primary - that is borderline within 1-km of Mon Jervois. So this may be a concern for parents with primary school going kids and no affiliations.

 

Our parting shot
 

Mon Jervois is one of the few new developments that the wife and I are rather impressed about and can put a "like" to. But the bit that we are struggling with is whether we liked it enough to pay over $2.65 million for it.

P/S: If you are heading down to the Mon Jervoissales gallery and wish to be attended by a marketing agent that is extremely pleasant and non-pushy, do give us a shout. We can provide you with a name but will rather not post it outright on our blog. And rest assured there is not vested interest with our recommendation!

 

 

Tags: ABSD / cooling measures / TDSR

What gives, Singapore property prices?

- August 1, 2014 1 Comment

So what does the experts think about the current status with the Singaporeproperty prices and when is the right time for our government to consider winding back some of the existing cooling measures? 

These are our main take-away from the round-table session organized by The Strait Times late last month, which was reported in the ST today. The panellists included Mr Donald Han (managing director of property consultancy Chestertons), Mr Song Seng Wun (regional economist at CIMB Bank), Mr Eric Cheng (group chief executive of real estate agency ECG Holdings) and Mr Li Jun (general manager of property developer Qingjian Realty):    
 

1. The market has seen a slow but sure decrease in pricing since 4Q'2013. While prices were expected to fall between 5 - 8% at the beginning of 2014, we will probably see prices falling 8 - 10% for the rest of the year. 

2. Barring any external shocks that may accelerate price decline, prices may fall 10 to 15% by the end of 2015. 

3. The current property downturn is likely to be different from previous ones, such as the Asian financial crisis and global financial crisis because

 

• Unlike previous times, Singapore currently still enjoy positive economic growth, very strong employment and very high liquidity. Given such, strong buying interests still remain as long as prices from developer is "right". So those 30% (global financial crisis) or 60% (Asian financial crisis) drop are unlikely to happen this time around.

 

• Even if a rude shock were to happen, we can expect policy response to be much faster this time around. So any downturn or recession will be better cushioned and compressed.

 

• Fundamentally, our banks are also much stronger and amongst the most liquid in the world.

 

• Buyers are also more liquid and just waiting for the right opportunity to enter the market. Developers are also equally liquid these days. So we hardly see any distressed sales, both by home owners and developers, unlike during the global financial crisis. 

4. A 20% drop in home prices is probably the psychological threshold that policymaker will come in to ease off on cooling measures. If you purchase a property 3 to 4 years ago, your LTV (loan-to value) is about 80%. So banks will start asking for top-ups if home values drop 20%.  

5. As it stands, only a sharp drop in property prices within a short period, or a groundswell of unhappiness from a large number of home owners, could prompt the government to act faster to relax on cooling measures. 

6. Home buyers are advised to wait before taking the plunge as prices are likely to get more competitive.

 

So we have heard from the experts. The magical number is still 20.

 

After reading the ST article today, here are some thoughts from us "non experts" in line with the round-table discussion for anyone that wants our 2-cents:   
 

1)      Although the Singaporeeconomy remains somewhat positive, subtle signs of a slow-down are beginning to show - GDP is shrinking, economic growth rate forecasts are being cut and new job creation rate has hit new lows.  
 

2)      There have been increasing "sound bites" from banks about NPL (non-performing loans) on the home mortgage front. Despite the number being still low and "manageable" by the banks' standards, this is certainly a cause for at least some concerns.  
 

3)      In addition, interest rates are moving up slowly but surely. This will put further pressure on existing home owners with significant amount of mortgages. 
 

4)      The current geopolitical situation around the world are not giving us much comfort either. Any of the "hotspots" may explode overnight and causes dire effects to global financial markets. While Singapore may be more resilient to deal with a financial crisis as compared to 1997 or 2007, there is probably little we can do to mitigate the damage if the rest of the financial world goes into a tail-spin. 
 

5)      If our memories served us right, things started unravelling fairly quickly during 1999 and 2007. The property markets were down in a matter of weeks and at astonishing pace. All the buyers simply disappeared! So any counter-actions to try and prop/revive the market at that point in time were more or less futile.  
 

6)      While a price drop of 20% in property prices tomorrow may benefit certain groups of people (the "cash rich" and "risk taker" as per our previous post), it may led to rather serious repercussions and even negative equity for some. Despite all the talks about high level of liquidity out there, the wife and I believe (rightly or wrongly) that this only resides in the hands of a small group of potential buyers. There are many people out there that are seeking to "upgrade" and are primarily dependent on the money that they are able to generate from selling their existing homes to do so. So a sudden and severe price drop may not necessarily benefit this group of buyers. 
 

7)      So what is the "right" time to enter the property market or "upgrade"? Our mantra has always been that one can almost never catch the highest (for sellers) or lowest (for buyers) price point. At least we have never managed to do over the past 5 or 6 properties that we have bought and sold. Our "right" time is a combination of "gut feel", comfort level (especially if we are going to stay in it) and more importantly, affordability (are we stretching ourselves too thin in terms of the cash component and can we reasonably afford the mortgage payment over the course of the next 5 years?). And as long as you possess the "holding power" and given that the property market comes and goes in cycles, you wouldn't go too wrong even if you enter the market now. This approach has served us rather well thus far (*fingers crossed*). 
 

8)      So where do we see the market in 6 months' time? We have often been off the mark when comes to this question. But sticking our necks out (again), the wife and I reckon that private property prices will probably fall by some 10% by the end of the year. This is assuming that everything (government policies, global and local economic/political situation etc.) remains status quo.