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Bursting The Property Bubble | Is Success Resources Scam


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The best time to invest in Real Estate In Singapore

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Bursting The Property Bubble | Is Success Resources Scam

  1. 1. BURSTING THE PROPERTY BUBBLE Just when you thought property prices in Singapore would cool off from the measures the government as taken, coupled with the fresh supply in BTO flats, we were hit with this latest shocker. Even property insiders expressed surprise at this news. Resale prices of public-housing units increased by 2% per cent in the third quarter – the sharpest increase so far this year – to hit a record high. Another report revealed the most pressing concern for Singaporeans is the cost of housing. A total of 21,470 people cast their votes in an online poll with each respondent allowed to vote only once, and on a single issue. 28% of people voted for the cost of housing. And it’s no wonder. At these prices, how’s anyone going to be able to afford these flats? And Why is this happening? All these measures were supposed to help! One analyst attributed the Q3 increase partly to recent news of record resale flat prices last month, including an executive condominium in Queenstown which sold for S$1 million. Success Resources:
  2. 2. Property analysts said it would take some time before the effect of the increased supply is felt. As such they expect the Resale Price Index to go up by another two per cent in the fourth quarter. Property news like this does something to home owners – they get greedy, develop unrealistic expectations, which in turn causes the average Cash over Valuation on properties to rise. What’s worse is that the COV is a sum paid above the bank’s official valuation, which can’t be covered by a loan. The COV is a speculative and variable factor, artificially inflating the property market and it’s completely unregulated by the government. Every seller that completes a transaction boosts the average last transacted value of the price of the flat which makes other sellers unwilling to lower their expectations. The end result is an unsustainable bubble of price inflation. So, what can you do in the meantime? If you can’t afford the COV (remember it’s paid in cash), you better just get a new flat. But if you can wait, you can time the market. And as we know, all over-inflated bubbles have a tendency to pop when the market corrects itself. Wait until the unsustainable price inflation hits its peak, and then plummets downward. Analysts from Forbes predict this to happen within the next 5 years. The new BTO flats will be completed, slashing immediate demand and once more people who have bought flats within the last 5 years meet their minimum occupancy requirement and start flooding the market with their properties, the oversupply will correct the housing market. Just make sure you have enough cash on hand to snap up these housing deals when the market bottoms out. Success Resources: