Rental Direction

[Up in April]

Rents continued to rise in April, up 11.5% YTD
While residential rents were slightly weaker in March, rents rose 6% MoM in
April. Year-to-date, we estimate rents have risen 9% in the mass districts, 11%
in the mid-range districts and 14% in the prime districts. The number of leases
signed in April was also healthy at 2,629, compared with the monthly average of
1,628 in the first quarter

UBS.

[Landlord]

I am one of the people who think supply of rental properties will become tighter as the years go on and property will go up substantially in price.

[same trends]

Rents spiked based on supply issues over the past few years.

We can also expect to see the rental market slump as investors who bought under DPS have to start paying massive mortgages. In this instance they will have to take what ever they can get to cover the payments.

For example the repayments on a 1 million condo at 2% will be 1600 per month. We can expect to see many of these condos renting for this price again as desperate investors play it safe.

This will drive the total rental market down with it. Happy days for expats again!!!

[Our condo]

For the first time in over a year, I am seeing "for rent" signs appearing on the balconies of apartments in our condo.  The apartments don't seem to be shifting as quickly.  Only anecdotal evidence I know but for me, that's evidence enough that any landlord with half a brain will be open to negotiation.  I wouldn't have said that a year ago.

[RocketScientist]

'Interesting' maths..

The repayments on a $1m condo (borrow 800k) at 2% over 25 yrs would be $3.4k pcm

In order to pay $1600 pcm, you would need to borrow the money for 90 years

[interest only]

many DPS borrowers will be forced to take interest only loans and hope to hold 3-5 years when they can get their money out.

It is a mess. Could be much worse than sub-prime when it hits because we will be in the middle of a global recession.

[Keep on dreaming]

many DPS borrowers will be forced to take interest only loans and hope to hold 3-5 years when they can get their money out.

It is a mess. Could be much worse than sub-prime when it hits because we will be in the middle of a global recession.

Keep on dreaming about DPS causing a mess. Look at the asking prices in classified carefully and you notice that prices are stubbornly very high. I wonder where are the fire sales?

[interest only]

Fire sales will start when DPS contract completions start to bite. Also read the Stagflation thread. Recession is happening with massive inflation also taking hold which is driving up commodity prices. Singapore is lagging behind the downturn but it will happen as expats get retrenched from the finacial sector already happening with 100s of Citibank staff on their way home.
The next big shock will be a raise in interest rates.
Be patient. Absolute bargains will appear from about 2010 onwards

[Must Buy or Rent]

If you dont buy, you must rent.

Which explain the surge in leased contracts in April.

This in term push up or give strength to rental market which than give strength to resale market due to solid yeild.

So you see its a interesting cycle.

Only when housing demand falls will price falls.

[housing demand is falling]

housing demand is falling and will continue to fall with the global recession.

Things like IR and Youth Olympics are just tourist blips and will make no significant long term impact on housing demand.

Singapore economy is totally dependant on manufactured goods and services and global prices for such. As demand contracts so will income and property prices accordingly.

[Fire sale?]

What is meant by Fire Sale?  I've seen it in the ST Classifieds.  At first I thought property damaged by fire, but there seem to be lots of them.

[asdfg]

What is meant by Fire Sale?  I've seen it in the ST Classifieds.  At first I thought property damaged by fire, but there seem to be lots of them.

It means the property for sale is on fire.

[Fire sales over]

Fire sales will start when DPS contract completions start to bite. Also read the Stagflation thread. Recession is happening with massive inflation also taking hold which is driving up commodity prices. Singapore is lagging behind the downturn but it will happen as expats get retrenched from the finacial sector already happening with 100s of Citibank staff on their way home.
The next big shock will be a raise in interest rates.
Be patient. Absolute bargains will appear from about 2010 onwards

Would you be that silly for DPS contract completion to put up your unit for sale or would you do it now? Most fire sales have ALREADY taken place. From now on price declines will be due to smaller developers forced to sell

[many reasons]

There are many reasons for prices starting to move down. Global recession. Over supply. Market peaked so investors vacate the market then there is DPS. The fire sales are only just beginning.

[mortgagerates]

mortgage rates have been at ultra low levels. but they are starting to rise and once they normalise the $4000 salary a month guy who paid $1000000 for his shoe box will end up as a distressed seller. that is when the market really will crashes. unti then it wil just fall, rather than free fall. with inflation a problem globally it is hard to imagine yields not rising dramatically from presently absurd levels in singapore (sibor sub 1% now?).