It is official now

[Prices going down]

Dismal private property sales despite lower prices

Private property sales by developers remained weak last month, with 441 units sold. That may be up 55 per cent from the 284 units sold in April, but over 3,000 new units remained unsold. That was despite developers cutting their prices for homes in 18 developments last month. Median prices for The Verve along Jalan Rajah, for example, dropped 17 per cent from 1,187 psf in March to to 985 psf in May.

Mr Colin Tan, Chesterton International's research and consultancy head, said: "Presently, the market is dominated by investors rather than owner-occupiers because current price levels are beyond the affordability of most owner occupiers."

"To nibble at this investors' market, developers will have to lower prices and have to continue to lower them sustain sales," he said. "A one-off price reduction may generate some sales but it will stagnate once that segment with that certain level of risk appetite is secured or captured."

Some developments still saw fairly good sales last month. DTZ Debenham Tie Leung's research senior director Chua Chor Hoon named Vutton at Akyab Road and Orchard Scotts as examples, but that some developers are holding off from new launches.

Property analysts expect smaller listed developers to lower prices first, as they will be under pressure to boost earnings.

As for leasing, Cushman and Wakefield's Singapore managing director Donald Han said: "Contrary to the widely held perception that the rental market is still hot, it has already stabilised. The overall vacancy level is slowly rising as more units are completed."

Today Paper 17th June 2008

[chaos theory]

Contrary to the widely held perception that the rental market is still hot, it has already stabilised. The overall vacancy level is slowly rising as more units are completed."

Here is a quick analyis to confirm the rental market is the next "house of cards to fall"

Citigroup have announced 15000 job cuts worldwide. The financial sector sets the benchmark for rental in Singapore.

Singapore is the Asia Pac Hub for Citigroup. ( Thats why Sing Govt pumped in $ 7 billion recently). Lets be conservative and say only 5% of the worldwide job cuts are in Singapore.

Ok thats 750 jobs. Lets say 1/3 are expat jobs. Thats 250 jobs. The expats in Singapore have a conservative low end housing allowance  $5000 av per month.

So thats 250 X 5000 X 12 = 15000000 per year of rental income that has just been taken out of the economy.

If you extrapolate that out into how much purchased property this funds at an interest rate of 4%, you get a figure of $300,000,000 worth of property sales.

And this is just one finance company. Now multiply this by the number of finace companies...you get the idea. It is scary. This is why sales have stalled.

[NewsCLSA]

0231 GMT [Dow Jones] Despite Singapore's primary residential data showing signs of recovery in May with uptick in both new launches and unit sales, CLSA remains Underweight on the sector. Says developers held back launches, adopted soft launches to clear inventories, causing actual launched units to be underestimated, take-up ratio likely overstated. Notes also, overall demand remains weak, as 2008 year-to-date new sales only 29% of annual sales in last market trough in 2003; also only 11% of 2007 sales. "We remain of the view that a turnaround is not in sight. Developers are releasing more projects as reflected in the latest data, but these are at lower prices, as revealed by our analysis. This continues to reflect market weakness." Says City Developments (C09.SG), Keppel Land (K17.SG) more exposed to Singapore residential slowdown than CapitaLand (C31.SG) due to 11%-27% NAV exposure to Singapore residential, slow Vietnam residential market (for Keppel Land). (LES)

[Read again]

For every 1 job taken away, 3 is created.

You can see how people choose to ignore this fact and try to quote out of context.

[few thoughts]

First where does this create jobs come from which you assert as fact.  Second, what sort of jobs?  3 binmen for 1 banker doesn't help.

Next, while generally I like chaos theorys posts this one is just wrong.

First, 5 percent is aggressive, it is a processing hub. Next 1/3rd being expats is aggressive. Next assuming they all get housing is aggressive.

I work for a bank that just laid off a number of people globally.  Singapore is our regional hub.  Not a single expat here with a housing allowance left.

[chaos theory]

First where does this create jobs come from which you assert as fact.  Second, what sort of jobs?  3 binmen for 1 banker doesn't help.

Next, while generally I like chaos theorys posts this one is just wrong.

First, 5 percent is aggressive, it is a processing hub. Next 1/3rd being expats is aggressive. Next assuming they all get housing is aggressive.

I work for a bank that just laid off a number of people globally.  Singapore is our regional hub.  Not a single expat here with a housing allowance left.

To few thoughts. I am trying to be conservative and extrapolate the figures from Citigroup worldwide job cuts and see how this will impact the local rental market for expat housing.

The figures are rubbery. We all know how expat contracts work. ie they are generally 1-3 year contracts. I suggest that a lot of expat finance sector contracts will not be renewed and a lot of Finanace expats will be heading to Changi over the 6 -18 months.

No firm data yet. Im just putting that idea on the table.

So based on that premise. If the number of Finance expats who leave Singapore over the next 6-18months is 250 and their jobs are not replaced ( again I am supposing) then the figures above are valid.

[Read again]

First where does this create jobs come from which you assert as fact.  Second, what sort of jobs?  3 binmen for 1 banker doesn't help.

Next, while generally I like chaos theorys posts this one is just wrong.

First, 5 percent is aggressive, it is a processing hub. Next 1/3rd being expats is aggressive. Next assuming they all get housing is aggressive.

I work for a bank that just laid off a number of people globally.  Singapore is our regional hub.  Not a single expat here with a housing allowance left.

First quarter Job creation and retrenchment figures?

Or should it be 1 taken away 30 created to be more data accurate? I take it as 10% of which are jobs for financial sector.

[ManPower Ministry]

Employment growth remains strong; Unemployment up; Retrenchments unchanged

Employment

Employment continued to grow strongly as the economy picked up pace in the first quarter of 2008. Preliminary estimates show that employment grew by 68,400 in the first quarter this year. This is higher than the increase of 62,500 in the previous quarter and 49,400 in the first quarter of 2007.

2.   Services continued to lead the employment gains, adding 42,900 workers in the first quarter of 2008. Driven by the growth in building activities, construction increased its workforce by 13,400, continuing the rapid increase of the earlier quarters. Manufacturing posted gains of 11,900.

Retrenchment

3.   Preliminary findings show that 2,000 workers were retrenched in the first quarter of 2008. This is about the same as the number retrenched in the previous quarter (1,966) and in the same quarter a year ago (1,964).

4.   The majority of the workers retrenched were from manufacturing (1,500), mainly from the electronics industry. Another 500 workers were laid off from the services industries.

[few thought]

First where does this create jobs come from which you assert as fact.  Second, what sort of jobs?  3 binmen for 1 banker doesn't help.

Next, while generally I like chaos theorys posts this one is just wrong.

First, 5 percent is aggressive, it is a processing hub. Next 1/3rd being expats is aggressive. Next assuming they all get housing is aggressive.

I work for a bank that just laid off a number of people globally.  Singapore is our regional hub.  Not a single expat here with a housing allowance left.

To few thoughts. I am trying to be conservative and extrapolate the figures from Citigroup worldwide job cuts and see how this will impact the local rental market for expat housing.

The figures are rubbery. We all know how expat contracts work. ie they are generally 1-3 year contracts. I suggest that a lot of expat finance sector contracts will not be renewed and a lot of Finanace expats will be heading to Changi over the 6 -18 months.

No firm data yet. Im just putting that idea on the table.

So based on that premise. If the number of Finance expats who leave Singapore over the next 6-18months is 250 and their jobs are not replaced ( again I am supposing) then the figures above are valid.

Still disagree.  Pharma and oil may be typically on fixed term contracts, most people in banks are merely employed by the local branch and may or may not get perks such as housing (a lot fewer now than a few years ago - now dir upwards when it used to be everyone).  Contract renewal is irrelevant, what may be relevant is if they choose to leave themselves when their housing allowance runs out as it is typically for 3-5 years, not permanent.

Still, the estimates of people here affected and the proportion of expats is far too high.  I doubt 5% of Citi staff globally are here (maybe of their investment bank but not the whole firm - could be wrong on this though).  You also tend to have offshore hubs like Singapore hit more softly in these things.  Also being set up that way I'd guess closer to 1% of their staff on housing allowances than 1/3.

As to the employment question.  Great, creating lots of contruction and manufacturing jobs, that will help condo rentals no end.  What is services anyway, that can be anything from waste removal to law partner?IB MD.  Nevertheless a large proportion of the jobs will be sharing 8 to a room up North somewhere.

[chaos theory]

We are talking about expat jobs in the finance industry with and average housing allowance of >$5000 per month to fund the cost of servicing a loan on a condo.

How many of the 68000 jobs has a housing allowance of $5000 per month?

[Fail Maths?]

We are talking about expat jobs in the finance industry with and average housing allowance of >$5000 per month to fund the cost of servicing a loan on a condo.

How many of the 68000 jobs has a housing allowance of $5000 per month?

You dont sound very smart.

Your assumption of layoff in Singapore for Citibank is 750???

For that to happen it would require nothing short of a severe economy downtown in Singapore. Not to mention despite the US gloom, Singapore is still booming with GDP > 5% expected.

In the latest Manpower report, a grand total of 2000 in the 1st quarter were layoff and only 500 are from service sector. You cannot count?

[pity then]

That exports fell 10.5% last month.

[RAMBLER]

There will be a see-sawing of property prices, and it will move up and down vv in small notches for a little while more until the credit crunch and oil speculation and food shortages blow over. It has got to come to an end, lets face it. However appetites have been largely whetted targeted for huge gains. To all you sourgrapes and kiasus your only chance is to sniff out a desperado, and better do it quickly, cos once things get manipulatively "settled", watch it, this time round the next wave shall see phenomenal increases unimagined before. There is no turning back.

[Rambler is a nut]

There will be a see-sawing of property prices, and it will move up and down vv in small notches for a little while more until the credit crunch and oil speculation and food shortages blow over. It has got to come to an end, lets face it. However appetites have been largely whetted targeted for huge gains. To all you sourgrapes and kiasus your only chance is to sniff out a desperado, and better do it quickly, cos once things get manipulatively "settled", watch it, this time round the next wave shall see phenomenal increases unimagined before. There is no turning back.

Rambler, but your money where your mouth is and gear up with the banks to buy as many props as you can lah. sure win what. nothing to scare right? easy money. come on, you can do it! Sell and make money in a couple of years time correct? In the meantime, find some tenant and squeeze as much rent as possible from them. What a plan! you go boy! Woohoo.

Nuts...

[he is]

smoking crack, the authorities will find him soon.

Rambler, cut it out quickly.