Saturday, 31 December 2011


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HAPPY · ˚ ˚ ˛
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 l || ˚ ˛

Wednesday, 28 December 2011

What will the world be like in 2012?

What will change in 2012? What will stay the same? Here are 12 presentations that take a look at where we’ve all been in 2011 and predict trends that we’ll see in the coming year.

Link :- Read them here.

Tuesday, 27 December 2011

Story of the Year 2011 - Of Tall Trees (Leviathan) and Mushrooms

2011 was an eventful Year. The World was "rocked" with events from The Great Sendai / Miyagi Earthquake and Tsunami  ... The Great Bangkok Flood ... just as NZ Christchurch was jolted by another quake  as I started to draft this posting while the Euro-Zone Crisis continues..

It had been an exciting year for me personally. Two major events had been most significant, meaningful and memorable for me to have participated in 2011.

(a) The Presidential Election Campaign
(b) The Opening of the New Clementi Interchange

The first was for supporting a friend on a worthy cause and brought me closer to a better understanding of the new social media.

PE 2011 Collectibles

The second was part of my regular job for a project and brought me closer to look at the recent events hitting the SMRT as a public transporter. Both has a wave of nostalgia.

Does the arrow means MRT and Bus fares will  continue to rise as HDB flat prices skyrocket in the background ?

I was thinking what to write to close for 2011 and to welcome 2012 in a new way for this blog. I thought it would be great to recap the following "Story of the Year 2011" which now appears very well said during the last General Election, retrospectively.


The story was :-

...about a village which was sheltered by special tall trees which protected it from storms. Yet the villagers were tempted by mushrooms which spouted only every five years.

"The villagers asked, 'Are these mushrooms any good? They are so pretty. Shall we remove some of these tall trees and allow the wild mushrooms to grow?' And so the wise old man told them that these mushrooms may look pretty but some of them are poisonous, and 'if you associate too closely with them, these wild mushrooms will weaken us, stunt our growth, and retard our development. Leave them alone, protect the trees, these trees are special trees'."


As if a magical spell was casted, we watched the "story" befallen on the SMRT, as I also wrote here in this blog about its corporate culture; and ironically on the great story teller during GE 2011.

If the CEO can't change the culture and the Leader (great story teller) could not spot the poisonous mushrooms, what do you do? Appoint a "BOI" and bring in an Union "Superman" while another tries to stamp out the villagers' noise?  There are no more Wise Old Man to "re-juvenate" this simple story of Tall Trees (Leviathan) and Mushrooms again ..... One must at be an ardent practitioner of taiji or at least make it to the Exco of an International Tai Chi  Federation to stay cool when the crisis get too heated up. Does this sum up "what politics are all about" (when we struggled to  Hi 5, LOL) ?

It is easier to tell a story than solve an organisational cultural issue as the reality will unfold.  With this, I close 2011 for this blog, as we await Story of the Year for 2012 - "How to lower Ministers' Million Dollar Salaries without having them to ruminate and regret for 5 years?". I will return with a new series on What exacerbates Middle Income Stagnation in Singpore and the Marginalization of PMETs jobs due to "Foreign Talents" in the new year.

All the best in the New Year ahead. Cheers.

Thursday, 22 December 2011

Blame SMRT’s corporate culture

Tend to agree with this article by P N Balji. I share similar thoughts in my earlier posting, "SMRT - A Public Transporter that Went Terribly Wrong with its Business Model ".

Tuesday, 20 December 2011

Elderly woman suffers head injury after SMRT bus fall.

Now another incident involving SMRT as reported in Yahoo News. Blame it on bad luck?

Elderly woman suffers head injury after SMRT bus fall.

Ding was with her daughter at Orchard Road near the Heeren on Sunday night when they both boarded bus service 164. 

While on the bus, the bus captain suddenly jammed the brakes, causing the 54-year-old Ding to lose her footing and fall. She then hit her head on a seat and fell unconscious. It’s believed she fractured her skull during the fall.

She was sent to the Singapore General Hospital where an operation was performed to stop the internal bleeding in her brain. She is still in critical condition.

Monday, 19 December 2011

Diary of A Singaporean Mind: MRT breakdown and what is wrong with our transport system....

Diary of A Singaporean Mind: MRT breakdown and what is wrong with our transport system....

SMRT - A Public Transporter that Went Terribly Wrong with its Business Model

My recent involvement in the commissioning of the new air-conditioned Clementi Bus Interchange brought me out of the construction industry and closer to the Singapore transportation industry.

The first day Transport Minister Lui Tuck Yew took over his portfolio after the May General Election, I witnessed him personally standing at the Jurong East MRT Station platform to appreciate the morning crowded condition at Jurong East MRT Station "first-hand". I was greatly impressed by him. That was before the new platform was opened.

It must have been a sigh of relief for him after the opening ! ... Hmmm ... what is left to be done is probably to add more new trains, and perhaps things will be back to "normal" till the next GE in 2015. Meanwhile, SMRT would probably continue with its incremental annual fare hikes despite public protest about SMRT's profits.

I would have thought so personally too. Personally, I have been involved in the new Clementi Bus Interchange commissioning recently. The old Clementi Bus Interchange used to be my "transit" point between SBS Bus 173 and the feeder service No 96 to NUS during my undergraduate days. I recall most weekends before the Final Exam in 1987, we would study on campus and visit the Clementi Hawker Centre for some nice food to "spur" us on. It was great for me to help see to the  upgrading of this nostalgic suburban HDB hub, some 20-over years later.

Routes can remain unchanged for over 20 years, but facilities must be maintained, if not upgraded.

Upgraded Clementi Town Centre

Meanwhile, I also heard about the switch to the temporary Jurong East Bus Interchange as the Jurong East Interchange will also be upgraded to an "air-con" one just like the Clementi Bus Interchange, etc.

Then, suddenly all the bad news seem to hit the "headlines" for the public transport industry again for public scrutiny.

First, several serious and fatal accidents; with drivers even escaping from the scene. Next was a China SBS driver of Service No 52, though with the "right initiative" to escape from a traffic jam; drove his passengers on a 2-hour "joy-ride" when he got lost whilst seeking "guidance" from the control centre as reported by Channel 8 news reporter Wu Liang Xiang who happened to be in that SBS bus. Our public transporter adopts sophisticated GPS technology so that they can charge us "distance-based" fares but the same technology could neither tell the control centre where the bus was nor guide the driver to its proper destination, as could be seen in the video. Do they expect the public to pay to add to their "efficiency" ? LOL. Profits yes!, customer service...hmmm...maybe not ?

The previous weekend, I read in the Straits Times about shops in MRT Xchanges making losses and SMRT taking legal actions to wind them up for not paying rentals. To me this was wrong strategy for the SMRT. It had deviated from its responsibility and "core competence" as a public transporter by "improving the shopping experience" in its premises ... something I had posted in this blog here when the vandalism case hit. I doubt such improved "shopping experience", a brain-child of the current CEO who used to managed Singapore's Duty Free chain; could be sustained as they compete with the surrounding shopping malls. The basic lesson any MBA student would have learned about "competitive strategy" is to concentrate on your "core competence", not straying into something which will tie-down your limited resources, where others who know best are not your direct competitors. It must be a joke now that they are ranked by a US consultancy for topping in corporate governance ranking; above top firms like SIA & OCBC.

One Graffiti painter broke into its "restricted" Changi Depot premises, you could dismiss your responsibility and blame "others" including the public for the shortcomings. SMRT could start to do "nonsense" like what as I wrote here for "face-saving" but when another Graffiti hit at another depot, what did that demonstrated? No chance to push the blame, but what are the remedial actions? Just add more cameras at the perimeter fences hoping to re-coup back from future fare increases?

Is it something wrong with the corporate culture and "The Million Dollar Salary Syndrome" I wrote sometime ago when a Thai girl fell into the track and lost her 2 legs at the Ang Mo Kio Station? You  could turn it into a legal case ... but then ...???

Or did the Workers Party really hit the nail at the right spot when it called for a nationalised transport system during GE 2011? The ex-PMO Minister and Second Transport Minister Lim Hwee Hua had said that 'commuters would be worse off with nationalised transport system'. Is this really so, putting her loss at the last GE aside?

The 2 recent SMRT outages certainly illustrate that the "profit and market mechanism" isn't working, definitely not when the "corporate culture and business model" is all wrong. How long could it last to hide under the "skirt" of the PTC to deliver a never-ending stream of incremental profits annually? Certainly, the Workers' Party should raise questions over train disruptions , as it is the only opposition party capable to highlight the needs of a "nationalised transport system", which is not purely motivated by pure profits alone.

SMRT should think about "service delivery" first as a public transporter and forget about becoming another corporate giant motivated solely by profits and at the expense of the general fare-paying public and its shareholders. We certianly do not need any enhancement of "shopping experience" at the expense of a safe ride.

Hmmm...I wrote about the upgrading of the Clementi Bus Interchange and the surrounding HDB hub. As I recently sat for lunch at Swensen at Clementi Mall which overlooks the Clementi MRT Station, I recall it was opened in 1987, the year I graduated from NUS. Clementi Town / Interchange went through the upgrading I wrote above, what about our MRT 1 which is more than 20 years old? Care to read here (my letter published in TODAY, 2 July 2003)  about the "Dare and Imagination" of LTA when the NEL was opened "driverless" ? I dare not imagine the worst scenario. Are they waiting for the fares to rise first? It is increased incrementally every year after all.

Breakdown in communication - that is only good as the introductory part of an excuse. Where is the "maintenance" to deliver that undisrupted service and safe ride which justifies the incremental annual fare increase? It was no wonder the initial reaction of the outage was to inform SMRT taxi drivers about "income opportunity" - more profits? Something must be wrong with the corporate social responsibility, corporate culture and business model of SMRT. Or do you need a nasty accident as part of the feedback mechanism to justify spending on maintenance?

Communication Problem ? - Interesting Sign at old Temporary Clementi Bus Interchange - No jaywalking ? SBS drivers must run in Bus Park ? SBS Driver take buses within Bus Park free ?

Tuesday, 13 December 2011

Revisiting The Property Bubble & Investment Trap Part 3 - Quick 2011 Year End Review of the Property Market & External Business Environment

After the Presidential Election campaign, I last wrote about the Singapore property market in End Sep 2011. I had not written much since then, for the following 2 reasons.

(a) As I put in my last posting, I believe it would be about "going back to the basics" for our property market ... "that property prices might move sidewards due to the world recession from 2009 and probably drag on for sometime longer due to the Earthquake, Tsunami and Nuclear Crisis in Japan and then the re-emergence of the Euro-zone debt crisis".

There were no significant "internal changes" to the property market since the May General Election and a change of MND Minister, until perhaps last night when new control measures were announced; except for the ever-continuing ridiculous pricing of some new EC & DBSS launches, despite the negative volatile economic picture arising from the Euro-Zone debt crisis. I will elaborate later on.

(b) I was busily involved in the commissioning of the new Clementi Bus Interchange, as the final phase of the Clementi Town Centre / Suburban Mall / Bus Interchange development project.

New Clementi Bus Interchange
The Old Clementi Temporary Bus Interchange
Just a short distance away, a new DBSS project was launched at prices which seemed ridiculously high to me considering the present negative volatile business environment and uncertainty of employment. So you may understand how difficult it is for me to comprehend and accept property prices if they are still ridiculous, when construction cost data are at my finger tips.

An interesting architectural shot taken of Clementi Towers
Appreciating in context - The Singapore's Property Market

Following GE 2011, my particular attention was on what measures the new MND Minister would take since "affordable public housing" was a "hot-potato" issue during the last GE. Nothing much came until yesterday night. These are my observations :-

(a) Ramped-up BTO supply.   That the new MND Minister was able to "largely cleared the  backlog of BTO first-timer applicants" with his ramped-up BTO programme in just 6 months, perhaps made it just too simple for the previous intelligent MND Minister to even think about it. No wonder his predecessor was too busy, and took more than a year; figuring out how to implement control measures to "fix" prices for "asset enhancement" but not simply to supply more affordable BTO flats when the waiting threatens with backlog ... or was it a bargain for electoral votes so that he could be empowered again to enhance your property value? This certainly looked "going back to the basics" for the new Minister and not of our property market that I wrote on 23 Sep 2011(LOL).

(b) Issue of HDB pricing.  The next issue which the new MND Minister could not answer for his predecessor was still on "affordability" of HDB flats. He has so far kept silent on the contentious issue of pricing HDB flats, which emerged as a top election issue. HDB, under Mr Mah, maintained that market-based pricing made more sense, although opposition parties had argued for a more transparent cost-based method.

I had posted on 17 Sep 2011 - "Since the stepping down of Mr Mah Bow Tan as MND Minister and the taking-over by Mr Khaw Boon Wan, I believe nothing has changed to the pricing formula for new BTO flats or even EC. If Mr Mah could not explain about profits on BTO flats and do something to the pricing formula, I believe there is nothing more Mr Khaw would do too, judging from his actions so far." [Re-visit the top-read posting in this Blog; posted on 21 April 2011 just before GE 2011 - "An illegal raid on the reserves? Mr Mah Should Explain About Ballooning Land Costs"]

"CPF grants are helpful but it seems like we are just taking money from one pocket to return it to another. We must seriously consider the pricing formula for HDB flats and seek to make it a transparent one as much as possible," said Zainudin, MP to Bishan-Toa Payoh GRC and his own PAP comrade in Parliament.

But do you now know the pricing formula for new HDB flats?

But I am sure you have read this :-

"As a result of rising land costs and the need to keep flats affordable, the size of HDB flats has shrunk by 5 to 10 per cent over the last two to three decades. For example, a five-room flat in Bukit Batok Central built in 1989 has a floor area of 121 sq m, compared to 110 sq m for a similar unit built in 2003....The shrinking size of public flats here has not lowered Singaporeans' quality of living, according to HDB CEO Cheong Koon Hean" but experts like Colin Tan disagreed as reported in this article in TODAY.

(c)  New Property Control Measures.  

"The new cooling measures mean any foreigners who want to buy a property will incur an additional 10 per cent stamp duty and another 3 per cent stamp duty. Including the seller's stamp duty, it may go up 25 per cent to break even in the next four years. The foreigner has to be really bullish about the property market," ... "With the additional 10 per cent, it will add $150,000 to the total cost of the stamp duty, which is already at 3 per cent,"  for most private condominium which is priced at about S$1 million.

Why the latest round of control measures?

I was chatting with a a new citizen colleague (formerly a China national) early this week. I told him that I expect prices of properties here to consolidate drastically next year. My arguments are the same as you might have read my previous posting(s) such as this in Oct 2010, but now also supported by new dismayed developments of the continuing financial crisis in the Euro-Zone.

He disagreed with me and told me a major price consolidation next year is unlikely. His reason - Just look at the number of China investors coming to Singapore to buy properties. China had tightened the property market and price had consolidated so much as evident at the End of Autumn which traditionally is the highest sale-volume month. I was monitoring the H-Share related HSI index and property counters and this review maybe a good simple summary. So China investors are instead investing here in Singapore. Perhaps unknown to you, many China investors are buying their 2nd or even 3rd property (home or here) with hard cash while many Singaporean genuine homeowners are struggling to pay off one very expensive property purchase with a "mortgage". He was right but that was before the new control measures were announced.

Sometime last year, you had heard our PM Lee said a double-dipped recession was unlikely; but just a few days back he would have thought otherwise as his NTUC Labour Chief told us to "bite 3 bullets instead of 1". Next, this would become his excuse for you to improve productivity but perhaps still let pay stagnate another 10 years ... (Read about what I call the $10K Salary Syndrome here) ..... Coincidentally, in U-Channel, I heard about the latest control measures.

If you asked me whether it is too late, I would say "Yes". But is it fair? ... Certainly yes... Why? Simply...those Singaporeans whom I considered to be daring enough ... had gone forward to purchase their expensive EC, DBSS etc at prices still ridiculous to me ...while the market was left 'open" to the foreigners since many moons ago after MBT announced earlier control measures ... "Tharman mentioned "no capital controls"...[read my posting dated 7 Dec 2010 more than a year ago here] ... and you may recall that the revision of income ceiling for HDB flats purchase was implemented exactly 1 year late since PM Lee first announced it during N-Day Rally in 2010. So the "capital controls actually came one year late but implemented in the form of new property control measures by KBW. For the obvious reason which I had also mentioned trap all those buyers for the last one year in - locals and foreigners included, while the "price was still ridiculous". This is for the sake of the economy in future and the Govt coffer.

Read here, HK is looking at relaxing restrictions on mortgages for residential properties if economic conditions worsen ...

Read here, China is looking at relaxing restrictions - "China's thin margin for error in property policies". ... "Fears that the euro might collapse, unleashing a tsunami of financial and economic disruptions around the globe, have added urgency to concerns that China's campaign to cool overheated housing prices may go too far."

But ... we in Singapore is putting in new control measures ... I am afraid a substantial number might have already been trapped ...  Is it really "An entire nation held hostage by the property market" ?

Is this effective to prevent a future drastic fall in property prices and a collapse or have you burnt your pocket and are already trapped?

Not if you had already committed and bought "high" in the last one year ... but good for those who are looking forward to a 10~15% price consolidation in the private mass property market, or a 15~20% price fall in the Central Core Area. It is worth the wait - isn't it, if you are not already entrapped?

Appreciating In Context the External Business Environment & Property Markets

Asia's economy looks heading for a 'yo-yo' year in 2012.

European banks' claims on Asia, excluding Japan, amount to $1.4 trillion, according to data from the Bank for International Settlements. If Europe's debt problems intensify and its banks retrench, they may pull back some of that credit with little warning, leaving Asia vulnerable to a sudden exodus of capital.

Singapore stands out among the most heavily exposed, with European bank claims amounting to 83 % of the country's gross domestic product, according to a Bank of America-Merrill Lynch economist, so you can imagine how much exposure we have to the Euro-Zone Crisis.

For some Asian economies, it is China rather than Europe that will most influence 2012's course. China is the largest trading partner for many Asian countries, and it is no longer simply an assembly point for goods destined for export.

That means what happens inside China matters a great deal for the rest of Asia. The biggest domestic worry centers on China's cooling property market, and the repercussions for bank lending and local government borrowing.

Beijing orchestrated a real estate slowdown this year to try to avoid a damaging property boom and bust. But the side effect has been a rise in troubled loans to developers, and a drop in land sales that has cut off a vital source of revenue for heavily indebted local governments.

Credit Suisse, which has been among the more bearish in its forecasts on China's housing sector, predicted property prices would fall 10 percent in 2012, bringing the cumulative decline to 20 percent from a mid-2011 peak.

China's central bank said on Dec 2 that home prices were at a "turning point" and banks were concerned about a possible chain reaction if prices were to fall by 20 percent. Many market watchers took that as a signal that Beijing would ease some of the restrictions it placed on home purchases.

China has already reduced the amount of reserves that big banks must hold, a measure that freed up an estimated $55 billion to $63 billion in lending capacity.

Economists expect China to continue lowering banks' reserve requirements. That in turn should help spark stronger growth in the second half of 2012.

So for Singapore, it is still worthwhile to look at China as an economic driver of growth. At least, it looks certain as an indicator of the direction for growth in Asia and its property market is of paramount concern.

The Likely Future Direction

Can the new MND Minister delivers the 10~15% price consolidation that those who still have not committed in private properties might be waiting for? And what sort of price are we looking at as fair as genuine home buyer?

In my posting last October 2010, I wrote about my general observations of the whole property market after the earlier control measures were announced. They were :-

Falling prices in land bids by developers
(a) Fall in price of DBSS land bids by about 10% to a base of about $220~$230 psf ppr.
(b) Fall in price of EC land bids by about 20% to about $230 ~ $ 240 psf ppr
(c) Fall in price of Private Mass Market Condo land bids by about 10%~15% to about $320~$340 psf ppr.

While there was a fall in bidding price for land psf, we did not see a corresponding fall in sale price of new launches since then. Most of these lands would probably have been pushed out in new launches by now or will have to be pushed out very soon as the URA requires development to commence with a certain time frame.
With the latest control measures announced, I expect "construction costs" to actually fall at least in the short run, probably to match the fall in land bids then.

While a 10~15 % fall in prices of private property seems imminent, whether it will materialise into a major price correction of say 25~30% will depend very much on the "external drivers", either on the Euro-Crisis or China's growth which has shown sign of slowing down recently and the future direction of the China's property market.

I read in the papers that developers are now offering discounts of about 10% to foreigners to offset the additional 10% stamp duty payable by foreigners due to the new control measures. You can see there is certainly a comfortable margin for developers to do so. Those who have paid high prices in the last one year would probably regret.

During the 2006~2007 boom of HDB re-sale flats MBT seemed to have successfully engineered for the HDB re-sale index to rise despite a fall in prices of private property index - The infamous asset enhancement scheme.

In the first series of my posting, I had explained how developers had tried and probably succeeded to push up prices of private properties by a "$200 psf" benchmark. This was propped up and made "sustainable" by the HDB re-sale index which defied a severe fall through the Lehman crisis. With supply of BTO now increased, I am looking at a different scenario.

The 2008 financial tsunami had shown that "nothing is impossible even for big banks". We have seen Dubai's sudden fall. What will the Euro-Zone Crisis deliver at the end? China is smart enough this time round, not to help out Europe but will help itself due to their imminent change of leadership in 2012. I am still looking at a major correction in private property prices by the end of 2012. This round of control measure will just lessen the pain of the fall for those who have not yet committed but certainly not for those who had been daring enough to commit in the last one year but got trapped by the "$200 psf benchmark" pushed up prices.

Next let's see if more will lose jobs as banks start to retrench. And do not forget, Singapore stands out among the most heavily exposed to the European banks. That you have voted for a "financially savy" EP may not help you out any more.

Tuesday, 18 October 2011

Public housing concerns raised in Parliament

"CPF grants are helpful but it seems like we are just taking money from one pocket to return it to another. We must seriously consider the pricing formula for HDB flats and seek to make it a transparent one as much as possible," said Zainudin, MP to Bishan-Toa Payoh GRC.

Thursday, 6 October 2011

Rich Mate Poor Mate II

Johnny Chan - Investment bank chief experiences the life of the elderly poor.

Johnny Chan was born to an industrialist family, and is known as one of the ‘wealthy third generation’. After graduating overseas, Johnny has worked in multinational investment banks. He describes the investment amounts he has handled as ‘astonishing’.

In this episode, Johnny will live with poor elderly people in a shabby cage house; work as a street hawker in a dawn market; scavenge on the street; and work in an undesirable cleaning job. He will reflect on how the elderly can live the rest of their lives with dignity.
Watch :'s Rich Mate Poor Mate II

Friday, 23 September 2011

Revisiting The Property Bubble & Investment Trap Part 2 - It is back to basics again

Those who have visited this blog recently after the Presidential Election should have noted my focus back on the watch of the external economic "drivers". Those who are not familiar with what the word "driver" means would probably have to re-visit and search in my postings in the first series on "The Property Bubble & Investment Trap". Yes, I am not talking about same "driver" analogy WP's MP LTK was talking during GE 2011. They are what could be driving the volatile financial market recently, especially the last one week.

As I write this posting, I had watched the S$ vs RMB exchange dropping from S$1 : RMB 5.36 to as low as S$1 : RMB 4.86 today. With all the attention now shifted back to the Euro-zone, we had seen in the past weeks US$ vs S$ rising from US$1 : S$1.21 to above US$1 : S$1.31. The volatite market is certainly worrying. If this persist, our construction workers from China are going to shake their heads. The smart ones would have remitted a substantial portion of their savings back home to China.

Many investors on expensive properties in Singapore are notably from China. If they are relying on monthly rental income as remittances, they be very keen to know ... Will this trend continue? What will the MAS do?

Just as I was wondering about the global financial picture, I came across this article, "Safe havens in Singapore property" by a pretty well known property analyst. While I may not have totally agree with some of his views on other topics in certain of my previous postings, I like what he said in this article, on the following points.

Leaving his points about S&P and fundamentals about stocks and REITs aside, I will pick out some interesting points he said or mentioned in his article:-

(a) "For most global investors, it is back to basics again ...".

This is particularly so, after what we had all have seen with the Lehman Bros Crisis.

(b) "The thin ray of positive light coming from the U.S. is for interest rates to remain low over the next two years, hopefully on the back of a U.S. recovery. Let's not forget that troubles in Europe and Japan may delay the U.S. recovery by some more."

I had mentioned somewhere in my previous postings, that property prices might move sidewards due to the world recession from 2009 and probably drag on for sometime longer due to the Earthquake, Tsunami and Nuclear Crisis in Japan and then the re-emergence of the Euro-zone debt crisis.

(c) "... they stated that the Federal Reserve's pledge to keep U.S. interest rates at record lows until mid-2013 will benefit REITs through low interest costs which can possibly widen profit margins."

If you look at this mid-2013 date, you would also realised that I had cited it in several of my postings in the first series. More specifically, my prediction of a major correction / possible crash of our property market in 2012 ~ 2013. You may re-visit my article, "The Property Bubble & Investment Trap Part XI - Currency war may fuel bubbles - Impact on Mid Range & Luxury Class Properties" posted on 24 Oct 2010. Other analysts had also mentioned the same about 2013. So, is 2013 or even earlier a year to watch?

One year has past since my article, and the past 2 QE. PM Lee had also bought time and taken a year to implement the revision of "income ceiling" for BTO flats & ECs - what I termed the $10K salary dilemma.

Is the sudden rocking of the financial market a pre-cursor for QE3? Or is it the start of another real nightmare or the "perfect storm" for our property market and also who ever has been given the mandate to safe-guard our reserves? Hang Seng Index had just dropped over 900 points and oil prices dropped 4%...and the whole world financial markets are rocking ...

(d) "... what might be considered "safe haven properties" in physical real estate?" ...

1. Freehold or 999-year leasehold properties
2. Trading at more than 10 per cent discount relative to other projects within walking distance
3. Comes with a good quality tenancy contract of at least 3 per cent of gross rental yield

With the prices rising faster in the outskirts of Singapore, and prices of older freehold properties in districts 9, 10, 11 being stagnant, my choice targets are centered around properties in the core central region (CCR).

Wow, short-term yield is only 3% for "safe haven" properties. If that is the case, why should you be buying ECs (especially if they are new launches) still at ridiculous prices rather than such "safe haven"  properties, when there is a possibility that the EC prices may correct by 20~25% from current high, whether or not "control measures" are still in place, unless FH ones in these key districts are too expensive for you as an average middle income earner. The analyst's advice maybe be for the richer "long-term" investors, but do watch the external economic "drivers" and interpret his advice correctly if you are not in the extraordinary richer class.

(3) "And given the low interest rates over the next two or more years, investors can consider taking on some borrowings to boost the cash-on-cash returns. However, leaning on the side of conservatism and allowing some space for errors, an investor can borrow at between 50-70 per cent of the property value and still sleep soundly even if the downpour should become a thunderstorm."

Why did he put a cautionary note to his whole advice if it is really that "safe heven"? Now, you would probably see why I had re-posted recently certain good advices from Tan Kin Lian's blog postings, as well as other bloggers here in this blog. It is not because I had supported him in his recent PE campaign and wish to help him recover his standing after the PE. It is simply that I share his insights and thinking that things must return "to the basics again". At least, this would give some hope for a cure, for the average middle income earners, who still believe in investing in properties, having seen through the rough waters since the Lehman crisis.

Now, you will see why I had advised to use "single" income as a gauge, even if you can make $10,000 a month. Now you will see why Tan Kin Lian say if you use "dual income" do factor it to about 70% of the combined income. Our analyst above said, go as low as 50%; even if it is "safe haven". So when you are talking about ECs which is just LH 99 years, do think twice.

Finally, there is a "driver" to watch in China & US as 2012 will certainly be a year for change of political leadership in China and possibly in the US too. Will President Obama finally "CHANGE" the US economy or will the US economy finally "CHANGE" him? I believe it would be about "going back to the basics" for him too and the US economy and world financial system, if not for other politicians and political systems worldwide.

Thursday, 22 September 2011

Home loan rates likely to climb

Home loan rates will likely climb next year, warn analysts

Analysts warn that Singapore's interest rates will likely climb in March next year, according to a Channel NewsAsia (CNA) report.

This means that loans, which currently range from one to 1.2 percent, will likely increase by as much as 0.3 percentage points by early next year. This comes even if the Singapore interbank offered rate (Sibor) component of mortgage loans remains low.

The report said that refinancing loans in the country is increasing but the rising cost of funds offshore, along with banks' profitability, may force banks to increase rates.

Sunday, 18 September 2011

Saturday, 17 September 2011

Revisiting The Property Bubble & Investment Trap Part I - What's next with the MND Minister, with the New Parliament Opening Soon?

Read this posting in Yahoo News :- Private home and EC sales slide 16 per cent in August. Sales slide but not the price.

REDAS is requesting the Govt to review the current control measures on property purchases.

Since the stepping down of Mr Mah Bow Tan as MND Minister and the taking-over by Mr Khaw Boon Wan, I believe nothing has changed to the pricing formula for new BTO flats or even EC. If Mr Mah could not explain about profits on BTO flats and do something to the pricing formula, I believe there is nothing more Mr Khaw would do too, judging from his actions so far.

Happy watching to you on what our Govt can do further to the property market, while I follow up more closely on the "external drivers" to bring you more interesting reads and postings, as this article by Collin Tan in TODAY seems to suggest, Link : Worry more about risk levels and less about supply. And if you had read my posting on 14 Jan 2011, The Property Bubble & Investment Trap Part XIV - Opening Shock in 2011; it could also be something for you to ponder and know why Collin Tan had said to "worry more about risk levels" and "less about supply".

The developers would want to push out new "supply" to test and push up the private property market, and the Govt would still want to profit from "land sales" [especially when GIC had just lost more billions from investing in UBS] ... and there you are, its back to "EC" after taking exactly one year to adjust "income eligibility bracket" for BTO and ECs, after PM Lee had announced it in the previous N-Day Rally and having seen MBT stepping down from his MND ministerial post.

Thursday, 15 September 2011

Diary of A Singaporean Mind: Developers to Khaw : Review cooling measures...

I had posted the following comments in Tan Kin Lian's Blog a few days ago. There was also a request from a keen visitor to my blog that I write an update about the Singapore property market. While I will be following up shortly on this topic, I thought it might be apt to post the following while referring to a posting by a popular Blogger, Lucky Tan; on this same subject. All these testify to the "perspective" and direction many independent minds are watching and thinking about (be it Tan Kin Lian, Lucky Tan, Yahoo News or even myself) what our PAP Govt would and should have done and how the property market is currently the light of evolving circumstances facing the world economy.


Developers are a calculative lot. They are afraid of the oversupply.

Now REDAS is asking the Govt for an indepth review of the property cooling measures.

Read :-

But if you look at the prices of the recent EC launches at Arc at Tampines ... the price isn't cheap. It starts at above S$741~$875 psf for 2rm, $693~$810 psf for 3rm.

Those who are not careful enough of the mechanics of their marketing techniques, they would be "tricked" into committing when price is still high.

Wait for a real correction of the property market, which looks quite certain if the world economy is going to be dragged down the US and Europe.


Read also :-

Diary of A Singaporean Mind: Developers to Khaw : Review cooling measures...

Thursday, 25 August 2011

Observe Presidential Election Cooling Off Day - 26 Aug 2011

Come 28 August 2011 .....?

In my last posting, I asked if Dr TT is tailing, based on the Yahoo News survey. There was a high percentage polled out of the nearly 5,000 respondents, some 71% who would prefer "Someone who questions government policies". Is this also saying something like Dr TT will get nearly 30% of the votes?

In any public chatroom in the Internet, if there were only few chatters; "weird" comments could be totally ignored. If there was a long list of comments, and the comments were nearly all negative, it would also not generate 100% votes against a candidate closely related to the ruling PAP party. 100% negative comments would probably garnered 60% pro-PAP or 40% pro-opposition votes as observed during GE2011.

Hence, how will the EP results turn out in 2011?

This is a nice piece "The ugliest election in Singapore history?",  by writer Catherine Lim in Yahoo News. I believe she is one who will never download any "apps" from the PAP into her grey matter.  LOL.

If only she would stand for election, our preamble in Paragraph 1 above that 71% would prefer "Someone who questions government policies" would be put to real test, and we could perhaps see the first lady President just like what Dr Tony Tan mentioned in his opening paragraphs at his lunch-time Rally speech.

Wow, read this :-

"the constitution was created more than 20 years ago by a self-serving government that provided it with enough ambiguities to allow for an interpretation that will always suit their purpose, it is no longer relevant. Indeed, it contradicts the new spirit of openness, transparency and expanded powers for the people"

But until then, how will our political climate be evolving with PE 2011? The average Singaporeans may not be politically matured to understand how our legal mechanics would work, but they are certainly the people  casting the votes and might even vote on instincts or emotions.

From scenario in Paragraph 1 above, where some 30% of the votes might be stuck on the extreme right (held by Dr TT) end of the spectrum, will a swelling middle ground then encroach into the comfort zone on the far left 30% occupied by TJS?

The answer seems to lie in the crowd at TKL's Rally held at Yio Chu Kang Stadium last night because TCB has yet to have his when this posting was written. Just look at the crowd that turned up last night despite the frequent personal attacks on TKL in the blogosphere by those crankiest of all.

It would be interesting to interpret the PE results come May 28. Will this "swelling middle" ground snatches away a substantial portion of TJS's would-be voters to create the closest fight of all amongst only 3 TANs. The loudest TCB's yet to be held Indoor Rally in theory should be aimed strategically at grabbing more votes from Dr TT's 30%. Then Paragraph 1 scenario above would not just be assumption but reality.

Come 28 August 2011, will Singaporeans be unified in the same boat? As one rally speaker had said with analogy, what "boat" would we be rowing in? [some emphasis for clarification are mine] :-

(a) Dr TT : Let's row forward in the same boat ? [With the same PAP policies]

(b) Dr TCB : Let's row forward in the same boat but more slowly ? [With same PAP policies but he will certainly take his time to sort things out, don't forget his "Singaporeans First" took 12 years for him to claim credit and only now when he stands for PE]

(c) Mr TKL : Let's change the boat ? [With Voice of the People]

(d) Mr TJS - Let's row the same boat but in the opposite direction ?[With confrontational politics? - N.B. Politics is not just about you saying you would chose not to confront.....].

Let's vote with conviction and look forward to 28 August 2011 for the real answer. Hi 5 !

Tan Kin Lian giving his rally speech in different languages

Tan Kin Lian & Voice of the People

Mr & Mrs Tan Kin Lian

Crowd mobbed TKL with Hi-5 as media team tried to get the best shot.
Tan Kin Lian Hi-5 with supporters after rally.

Supporters carrying placards of the 5 values - Honesty, Courage, Fairness, Positive Attitude, Public Service & Voice of the People

Wednesday, 24 August 2011

Presidential Election Watch Part VII - Is Dr Tony Tan Tailing Behind in the Presidential Election Race?

Yahoo News (Singapore) did a survey. The poll has expired and the results are as shown below.


What kind of President do you want for Singapore?

Someone who questions government policies (3552) 71%
Someone who will act only as advised by the Cabinet (81) 2%

Someone who will make protection of reserves the top priority (1161) 23%
Someone who will be a figurehead, focusing on ceremonial duties (199) 4%

If the results shown above were anything close to represent what is actually the feeling on the ground, about 71% had voted that they want "Someone who questions government policies" as President. Considering the sample size, it should be representative.

If so, the candidate who is unofficially endorsed by the ruling PAP Govt. Dr Tony Tan must be tailing in this PE Race since he had declared he would only fit the role as defined by our Constitution and as interpreted by Law Minister K Shanmugam.

I have been observing what issues Dr Tony would finally bring up to anchor his campaign. It looks certain that he would not deviate from the "threatening" economic condition facing the world economy.

Dr Tony Tan was speaking at the NTUC financial and business services cluster National Day observance ceremony on 19 Aug morning when he said :-

"If the impact of the financial and economic contagion spreads to Singapore, as we have seen in 2008 and 2009, the consequences can be very sudden, very widespread and very destructive."
"As I said, I think we should start making contingency plans. Be prepared, it's not too early so that if the crisis hits us, we have the plans ready,"
Since the President also has a diplomatic role in business delegations, Dr Tan said he can create opportunities for Singaporeans and its businesses overseas..... 
Remaining optimistic, Dr Tan is convinced that the nation's best days lie ahead and said, "With the right leadership, co-operation between the government, employees and unions, we can face the future with confidence."
You can read more about it in thie Yahoo report [ Link : Gov’t should be prepared for economic uncertainties: Tony Tan ]

Is Dr Tony Tan trying to cite economic uncertainties to instill some fear in voters in order to win votes. He is drawing out PAP past economic "weapons" as a supporting argument while he has only custodial powers if elected and does not believe in "Voice of the People". Had he forgotten that he had spoken in the past as DPM in support CPF and wage cuts for all Singaporeans while citing a controversial PERC report?

At his rally, he is bound to cite the "resilient package" again as a PAP carrot to aid his campaign. Singaporeans will be "daft" and confused.

His warning was again repeated last Sunday in the following Yahoo New report :-

But will he questions the Govt policies to favour Singaporeans at large? Will he supports another CPF cut knowing Singaporeans' past CPF savings have been greatly reduced due to the various crises and the blunt use of the CPF as an economic tool to save an ailing economy in the past.

The NTUC is going "all out" in support of Dr Tony Tan's candidacy. Suddenly, they are starting to raise issue with the CPF of those reaching age 50, or the baby-boomers borned in the late 50s and 60s. See my re-posting of TODAY's report in this blog and my comment : "TODAY Online Singapore - CPF for older workers should be reviewed : Seng Han Thong"

I am really looking forward to what he would say in his lunch-time Rally at Raffles Place. It will demonstrate how serious he views the contest at this critical stretch with Polling Day just round the corner this Saturday. If Singaporeans are smart enough to understand the individual platforms of the 4 PE candidates, it looks certain Dr Tony Tan will have a hard time.

Monday, 22 August 2011

TODAYonline | Singapore | CPF for older workers should be reviewed: Seng Han Thong

Because of the Presidential Election and the NTUC affiliated unions" backing of the unofficial Govt endorsed candidate Dr Tony Tan, it seems that all are speaking up tp help him.

Remember Dr Tony Tan once spoked aloud for CPF and Wages to be cut for all working Singaporeans while citing a controversial PERC report.

Read my posting on 25 July  :

Presidential Election Watch Part III - Dr Tony Tan & Singaporeans' CPF Savings & Wage Cuts

I think Dr Tony Tan is afraid to lose "baby-boomers" votes.

Sunday, 21 August 2011

Voters’ expectations could shape President’s role

The Constitution explicitly states the President's powers, but circumstances such as people's expectations and the President's political acuity will go some way in charting new pathways for the highest office in Singapore, said two commentators.

Speaking on the Elected President's mandate at a forum organised by local human rights body Maruah on Saturday, constitutional law expert Kevin Tan and civil society activist Alex Au highlighted "grey areas" surrounding the Presidency to show that the role is not straightforward.

So what will Dr Tan Cheng Bock do if he wants to be the People's voice?

So what would Dr Tan Cheng Bock do as he said he would also want to represent the People's Voice? So far, we know he will "de-cage" the PMO from the Istana. Asking the PM to leave from the Istana is for himself. How about the people of Singapore? So what will he deliver for the people of Singapore?

Up to now, I am still confused by his logics and arguments. We can't be going back to the old PAP way of muddling through the extinct Feedback Unit.

Sunday, 14 August 2011

A Visually Handicapped endorses Tan Kin Lian with his song - The answer is really up to you.

Visually handicapped Daniel singing in support of Presidential candidate Tan Kin Lian : Video

Although Daniel is visually handicapped, he sees Tan Kin Lian's values and believes he is the best choice for President.

Friday, 12 August 2011

Presidential Election Watch Part VI - They really know how to cajole!

As the PE Race hots up with 4 CoEs issued to the 4 TANs, the NTUC 19 affiliated unions are drumming up their support behind the unofficial PAP-endorsed candidate, Dr Tony Tan.

Quote from TODAY Aug 12, "S'pore economy on course: Lim Swee Say" :-

"Labour Chief Lim Swee Say says the Singapore economy should stay on course even as the global economy heads for another storm."

"Mr Lim, who's also the Minister in the Prime Minister's Office, stressed that Singapore's drive towards a cheaper, better and faster economy must continue."

"He's confident that Singapore workers can "do it again", in the same way they overcame the economic downturn in 2009."

While both Dr Tony Tan and DPM Tharman are warning about the same economic "storm" looming ahead, the NTUC Chief is 'confident that Singapore workers can "do it again" '.  Don't forget Dr Tony Tan would support a CPF and wage cut for all Singaporeans, to the extent of citing a controversial report [Read my posting -"Presidential Election Watch Part III - Dr Tony Tan & Singaporeans' CPF Savings & Wage Cuts" ]. But goodness, are workers expected "to do it again" and have their CPF cut again to "upturn the downturn" but with an EP concurring and "intimating" it to our PM? If there is no "Voice of the People", we would not even know about it, while he is doing this in protecting our reserves.

Tan Kin Lian with Supporters
I wonder if DPM Tharman's definition of "fairness" in his N-Day speech to Bukit Batok grassroots is same as what Tan Kin Lian is talking about in his PE campaign, based on the 5 values of "honesty, fairness, positive attitude, courage and public service".

When Tan Kin Lian left NTUC Income in 2007, it was before the Lehman Bros Crisis. Certainly, the NTUC top management would believe then in having "to professionalise" the managment when the whole world was talking about it to justify their "million-dollar" salaries. Were the NTUC Income's investments hit by the 2008 Lehman Bros Crisis soon after Tan Kin Lian left? If not, who was the CEO who made the long-term investment before the crisis? I know they would argue the Board must be smarter than the CEO then. I am wondering.

Who were those who probably had an eye over the NTUC Income board? Certainly, not without the current and previous NTUC Labour Chief. One has a "deaf frog" mindset thinking we will be "on course even as the global economy heads for another storm." The other had shed 3 rounds of tears to impress Singaporeans that there was no group think within our Govt and is now having more than 5 years to ruminate and regret during retirement for not objecting to build the 2 casinos. Maybe one day, both of them will ruminate and regret  having had to "to professionalise" the management of NTUC Income once upon a time. Will it be this coming crisis?

They really know how to cajole!

Better believe in "Voice of the People" and trust the 5 values - Honesty, Fairness, Positive attitude, Courage and Public Service.

Voice of the People