Can you afford to buy a HDB flat?
- Thread starter pokiemon
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Definitely not, unless there are serious deflation. But the situation now is the housing price is raise much faster compare to the salary raising rate. Those who own the house may be happy for now, but what about the next generation or who hasn't bought a house? Now seem to be majority benefit for it, but in long run, more will suffer from this.
night86mare
Deregistered
When asset such as housing increase in price, inflation will kicks in, all prices such as food, transport & etc will increase, but do you see your salary increase that fast?
Think about it. Its a vicious cycle which enriched the banks and man at top, but not man in the street..... How sad.
Think about it. Its a vicious cycle which enriched the banks and man at top, but not man in the street..... How sad.
I'm actually expecting the bubble to burst within the next 5 years.
Demands for housing in Sinagpore in the last few years are artificial in nature. It is driven mainly by 3 factors:
1.) An influx of migrants;
2.) Market speculation; and
3.) Seller expectations.
As population increases due to liberal immigration policies, demand for housing increases. Landlords exercises large scale housing space acquisition for his lucrative businesses and sellers of properties expect premium payback for their properties.
As public housing prices in Singapore is market based rather than cost based, prices of public housing are more directly affected population boom, speculations and expectations and hence will continue to rise. A home owner may initially think that he is making some fortune by selling his current property only to be faced with the hard reality that his next property acquisition will cost even more- leaving him with nett negative benefits in selling.
Like all artificial demands, the nature is volatile. An example would be that if another country in the region becomes more attractive for migrants, or for some reasons the regular stream of migrants found Singapore unattractive, a substaintial fall in the country's population can occur. This will eventually cause an over supply of housing which will fuel the market's reaction. Prices for public housing will plummet during the correction phase. Buyers who took loans from banks will be forced to top up the differences between the loan and the market prices of their flats when the loan was made. For example, if a loan of 250K was made for a flat selling at 250K at market then; falls to 150K, the bank will demand a cash top-up of 100K with the alternative being bank foreclosure.
There are many causes in the unique housing system that we have and one of them is the glaring deficiency in our Central Provident Fund system. As social safety net is weak and largely dependant on one's already deficient Central Provident Funds, housing is being viewed and used as part of the pension system for the majority of Singaporeans. The downside of depending on housing as part of a pension program is that the prices of homes must perpetually inflate and ride on the inflating market generated (hence possibly the choice of pricing flats in a market based rather than a cost based system). However, to achieve a year on year inflation of prices, demands must also surge year on year.
This leads us to a highly complex scenario. How do we ensure demand for housing continue to increase year on year? The only direct solution is to increase the population of the country year on year. Hence, part of the seemly positive outcome from the liberal immigration policies and foreign talent initiatives helped drive the housing prices in the short run.
Inccidentally this leads us to a more complex but classical economic problem. Resources are finite. There are enginnering limits to how tall a flat can be built and the true but painful fact that our land space is a mere 687 square kilometres. The housing space is further being competed by the need for offices and industries. When the limit of housing is reached, no new homeseeker is able to secure housing facilities. Demand cannot be renewed as the population numbers become stagnant for long periods. As demand for housing becomes stagnant, prices cannot be further be inflated in the absence of the classical drivers. With the stagflation occuring following this event, the value of pension invested in housing diminishes. This leads to an escalated issue of workers unable to exit employment as there is no feasible retirement funds to draw upon.
It is only logical that the common folk plans and executes his exit strategy today- not tomorrow.
Demands for housing in Sinagpore in the last few years are artificial in nature. It is driven mainly by 3 factors:
1.) An influx of migrants;
2.) Market speculation; and
3.) Seller expectations.
As population increases due to liberal immigration policies, demand for housing increases. Landlords exercises large scale housing space acquisition for his lucrative businesses and sellers of properties expect premium payback for their properties.
As public housing prices in Singapore is market based rather than cost based, prices of public housing are more directly affected population boom, speculations and expectations and hence will continue to rise. A home owner may initially think that he is making some fortune by selling his current property only to be faced with the hard reality that his next property acquisition will cost even more- leaving him with nett negative benefits in selling.
Like all artificial demands, the nature is volatile. An example would be that if another country in the region becomes more attractive for migrants, or for some reasons the regular stream of migrants found Singapore unattractive, a substaintial fall in the country's population can occur. This will eventually cause an over supply of housing which will fuel the market's reaction. Prices for public housing will plummet during the correction phase. Buyers who took loans from banks will be forced to top up the differences between the loan and the market prices of their flats when the loan was made. For example, if a loan of 250K was made for a flat selling at 250K at market then; falls to 150K, the bank will demand a cash top-up of 100K with the alternative being bank foreclosure.
There are many causes in the unique housing system that we have and one of them is the glaring deficiency in our Central Provident Fund system. As social safety net is weak and largely dependant on one's already deficient Central Provident Funds, housing is being viewed and used as part of the pension system for the majority of Singaporeans. The downside of depending on housing as part of a pension program is that the prices of homes must perpetually inflate and ride on the inflating market generated (hence possibly the choice of pricing flats in a market based rather than a cost based system). However, to achieve a year on year inflation of prices, demands must also surge year on year.
This leads us to a highly complex scenario. How do we ensure demand for housing continue to increase year on year? The only direct solution is to increase the population of the country year on year. Hence, part of the seemly positive outcome from the liberal immigration policies and foreign talent initiatives helped drive the housing prices in the short run.
Inccidentally this leads us to a more complex but classical economic problem. Resources are finite. There are enginnering limits to how tall a flat can be built and the true but painful fact that our land space is a mere 687 square kilometres. The housing space is further being competed by the need for offices and industries. When the limit of housing is reached, no new homeseeker is able to secure housing facilities. Demand cannot be renewed as the population numbers become stagnant for long periods. As demand for housing becomes stagnant, prices cannot be further be inflated in the absence of the classical drivers. With the stagflation occuring following this event, the value of pension invested in housing diminishes. This leads to an escalated issue of workers unable to exit employment as there is no feasible retirement funds to draw upon.
It is only logical that the common folk plans and executes his exit strategy today- not tomorrow.
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Thanks for the realistic insight.
Everything could happen including
drastic ones any time.
Many a thoughtful common folks did know how
to manage their money, however more often than
not they trusted their money in a way that they
cannot do more in their lives.
Showing off their world wealth now would get them
more responsibilities at a later stage with a higher
price to pay.
Really it is time to sit back and start
to back-up with some faithful simplicity.
Everything could happen including
drastic ones any time.
Many a thoughtful common folks did know how
to manage their money, however more often than
not they trusted their money in a way that they
cannot do more in their lives.
Showing off their world wealth now would get them
more responsibilities at a later stage with a higher
price to pay.
Really it is time to sit back and start
to back-up with some faithful simplicity.
Thankfully, I had parental financial help. Not that I asked, but they volunteered and I am grateful for that.
Have to agree that its difficult for a young family to start, given the situation now. Worse if the family have kids and worst if the family decide not to get maids and one of the parent stays home to take care of the kids. I guess I am in the worst scenario now. Haha.
Have to agree that its difficult for a young family to start, given the situation now. Worse if the family have kids and worst if the family decide not to get maids and one of the parent stays home to take care of the kids. I guess I am in the worst scenario now. Haha.
azul123
Senior Member
I don't think that is a bad idea at all... imparting your own family values to your children could be the best thing to do. Of course on the flipside less income, but somethings are priceless.
../azul123
Which is why I took the financially worst route. I will not be able to spend alot to buy the things I want to buy, but at least I'll have kids that grow up closer to their parents (i hope) and speaking english (or singlish) and mandarin rather than tagalog or malay (no offense).
And fundamentally, my kids are my responsiblity. Even if I have to go hungry or sell my camera and lenses (really hope not), its my job to bring them up, otherwise, I should not even bring them into this world. Why have kids when I am leaving them in the care of strangers? Personally, I prefer to be involve in the process of them growing up, to play with them, to get tortured by them and just enjoying the growth I see everyday. Cos they grow up only once. I dun wanna miss a single minute. Now they bug me to play with them. Later, I'll be the one bugging them to stay home to talk to me. Even now, I already miss my kid's younger days...
Sorry for the OOT.
azul123
Senior Member
No offence and none taken... that's a commendable direction to take on raising kids... I thought not many people are like this and nice to see a change once in a while. FYI, when they are grown up, you and your wife have to learn to let loose the stings a little, that said I think you took a good route.
Back to topic HDB still have those scheme to help a young family right?
../azul123
Back to topic HDB still have those scheme to help a young family right?
../azul123
iMac08
Senior Member
yes i agree...but your gear list....hmm..not too bad la..stll can maintain the top Ls..haha..
Ya, its a challenge that I am forseeing. But we'll have to handle that when it comes along.
Haha, I'll have to say that I am kinda blessed. I got my gears as a gift. :embrass:
Was that phrase ever used?
Good thing i bought my flat 2-3year ago 3rm for 180k.
Then I was complaining why so expensive and I do not wish to pay for the
15K above eval. Now, I think differently, it's a blessing and I do not complain
that much.
Ultimately, a family unit need FOOD and HOUSE to stay in. But the house
can be a cardboard box in some country and some a mansion with a LONG
driveway with gardens and galloping horses. My take, PLAN with wisdom
and ACT upon it with caution.
UandMe
New Member
Oh, you got good karma, according to Eric How's theory :bsmilie:
night86mare
Deregistered
paved with tiles of 18k gold :bsmilie:
9V-Orion Images
New Member
:bsmilie:
iMac08
Senior Member
that shld be reserved for the units at ION...every tile you step on is at least 7-8k if i not wrong...haha
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