Singapore Home Prices Drop for 15th Straight Quarter

Posted on July 3, 2017 by Curious Cat

Singapore has put in place measures to cool the overheating in home prices since 2009. Those measures have helped reduce the developing bubble in prices. They have achieved a slow deflation in prices without a crash (so far at least). Prices declined just .3% from last quarter and have declined 12% from a September 2013 peak.

Singapore Home Prices Extend Longest Losing Streak on Curbs

Singapore’s leaders, determined to keep a lid on home prices in the city-state, have unleashed a series of measures to cool the market since 2009. The government in March rolled back some property-market restrictions for the first time in eight years, although has cautioned that those adjustments don’t signal an unwinding of the measures.

In March, the government reduced stamp duty imposed on sellers and some mortgage restrictions. That helped stoke optimism that Singapore’s property market is rebounding, with home sales jumping and developers making more aggressive bids at land auctions. Home sales in the first five months this year have risen about 75 percent from the same period a year ago, data showed.

Singapore has managed this issue well. They waited a bit too long to act in my opinion but once they decided to act they have done well taking manful measures while also not moving too drastically and spooking the market.

photo of a driveway leading to a house with many plants in the yard

The house our family lived in while my father was a professor in Singapore. I took this photo years later while on a family vacation.

Their neighbors across the straits in Johor Bahru waited to long to act and didn’t take significant enough measures and that situation is still precarious.

Taxis Vanish in Rain as Singapore Gets Congested

Posted on September 20, 2013 by Curious Cat

I have found he taxi situation in Singapore to be poor. It is tolerable if it doesn’t rain, but even without rain is it not good (it is just too hard to find a taxi and waits are too long), not up to what I would expect from Singapore. Also the subways have become very overcrowded and again not up to the standard for convenience I expect from Singapore.

The root of the transportation problems are excessive population growth without the necessary infrastructure improvement. I think it has been a mistake to grow so much, but if the rapid growth is going to be the policy then the transportation infrastructure should have been managed much better. The rapid growth has many negative impacts beyond transportation: rapidly rising costs, changing culture with huge influx of foreigners, overcrowding, etc..

Taxis Vanish in Rain as Singapore Gets Congested

At 6 a.m. one weekday morning, 64-year-old taxi driver Koh Chia Hock set out to ply Singapore’s roads when it started raining. So he turned around and went home.

“If I go and fetch a customer, it’s very risky,” said Koh, as the heavy traffic raises the chance of an accident that could leave him without earnings while the car is repaired. “I don’t have the stomach for it. I don’t want to drive when it rains.”

Cab drivers like Koh are avoiding the traffic jams that have become a hallmark of Singapore’s tropical rainstorms after a jump in the city’s population and a surge in vehicles clogged roads.
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“There are too many cars,” said taxi driver Koh, who says it takes twice as long to get to the city center than when he started driving cabs a decade ago. “It’s not that there are too few taxis, it’s just that if they are not occupied, they are caught in jams.”
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The government’s Land Transport Authority says the average waiting time for a taxi in the city center during peak hours in March was 4.1 minutes and average traffic speed in the central business district in 2012 was 28.6 kilometers per hour (18 miles per hour).

Paul Barter… “Averages are very misleading,” said Barter, who has lived in the city-state for 12 years. “Things are not quite as bad as some people have been saying, they’re not quite as rosy as the government has been saying.”

What is happening is not surprising if it wasn’t Singapore; for most locations government mis-managing things is common. but Singapore has done so well for so long that when an aspect of government policy is implemented in a way that is just a bit better than an average (for most governments) it is very disappointing. Basically, Singapore has set expectations that the government will manage things very well, failing to do so is disappointing even if the results are really better than most places. This failure is really about the policy decisions to grow the population so much, so quickly, in my opinion. The transportation failures are a result of that policy, without that course of action transportation likely would be in good shape.

Fighting Dengue Fever With Genetically Modified Mosquitoes

Posted on July 7, 2013 by Curious Cat

With the ongoing Dengue fever outbreak in Singapore I wonder if they are thinking of experimenting with this option. The video was created by the Wellcome Trust (a UK based non-profit medical research organization) on this effort to fight the Dengue virus.

Oxitec is experimenting with genetically modified male mosquitoes that are infertile. So when they mate no offspring are born. They are able to target the specific mosquitoes that carry dengue (because those mosquitoes are genetically distinct from other mosquitoes).

From Oxitec’s Dengue Information Center:

Dengue fever is the fastest growing mosquito-borne disease, affecting over 50 million people each year across the world, and continuing to grow both in prevalence and severity.
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There are around 25,000 fatalities each year and severe cases require hospitalisation and constant monitoring. Dengue is an extremely expensive disease, estimated to cost the global economy over US$5 billion per year.

Dengue is caused by four different, but related, viruses (known as DENV-1,2,3 and 4). Once infected, a person can develop a lifelong immunity to that strain of the virus but can become more susceptible to the other three strains.

Singapore Housing Market Predicted to Cool in 2013

Posted on November 15, 2012 by Curious Cat

Singapore Curbs to Slash Home Sales in 2013

Singapore home sales may fall as much as 27 percent in 2013 after climbing to a record this year as six rounds of housing curbs by the government crimps demand, according to Jones Lang LaSalle.

Predictions are often incorrect. It does make sense to me that the repeated attempts by the Singapore government to cool the housing bubble will have an impact. But we will have to see what really happens. I do think Singapore is acting sensibly. If anything they waiting too long to take some of these actions (decreasing leverage is one of the best moves to make, which they have done).

The Singapore economy is forecast by the government to expand 1.5 percent to 2.5 percent in 2012, from 4.9 percent in 2011. The economy “slowed discernibly” in the past two quarters and will grow at below-potential levels for a second year in 2013, the Monetary Authority said Oct. 30.

You have to like government-speak (though even some investment predictions make such unclear statements) – “will grow at below-potential levels.”

The recent booming residential real estate market in Johor Bahru, Malaysia (a suburb of Singapore) is being fueled by Singapore’s wealth and the curbs in Singapore. The economic prospects for Johor Bahru are very positive. Still I think the Malaysian government should be adopting measures similar to Singapore’s. The best measure would be to reduce the leverage allowed. Require 20% down (even for condo units under construction). There is a huge supply of high rise condos to be delivered between 2014 and 2017 and those purchasers are putting very small amounts down. This is the type of situation that exacerbates bubbles.

Singapore Housing: Most Expensive and Most Affordable?

Posted on July 2, 2012 by Curious Cat

Singapore Homes Most Affordable As Rents Climb

“The clincher in Singapore is that monthly installments toward repayment of your loan are lower than what you would pay in rent,” said Anantharaman, a private banker at ICICI Bank Ltd., who took out a S$1.04 million mortgage for his S$1.3 million property late last year. “It’s one of the few countries in the world where that is possible,” because of the low interest rates, he said.

Homebuyers like Anantharaman are taking advantage of mortgage rates at an all-time low in the Southeast Asian island- state, even as prices are almost at a record high and the government introduced measures to cool the property market. Home affordability in Singapore has risen to the highest in a decade because of historically low interest rates and flexible payment options available to buyers, according to Jefferies Group Inc.

It was just the last post where I wrote about policies Singapore is taking to slow the rise of housing prices. Mortgage rates are a huge issue. If Singapore wants to slow the rising prices they should not allow variable rate mortgages. They also should consider eliminating mortgages over 30 years. The price might be what economist pay attention to but those looking to buy a place to live mainly look at their payment (the price is of some concern but not nearly as much as the payment). Super low rates greatly increase the price people can pay while keeping a low payment. 40 year mortgages also decrease the payment (though really not that much at super low rates).

Anantharaman, 29, pays 55 basis points over Sibor on a 40- year mortgage, effectively giving him a home-loan rate of less than 1 percent. By contrast, mortgage rates in India, his home country, are about 11 percent, according to Rajan Tandon, the Singapore-based head of Housing Development Finance Corp., the largest home-loan provider in India.

Mortgage rates in Singapore are the lowest in Asia, followed by Hong Kong, said Sanjay Jain, an analyst at Credit Suisse Group AG in Hong Kong. His analysis does not include Japan.

Hong Kong’s average mortgage rate is about 2.15 percent, while China’s is 7.43 percent, according to Barclays Plc. Indonesian rates range from 8 percent to 10 percent while in South Korea they are about 5 percent, according to the bank.

In New York, the $1.1 million median price of a condominium makes renting a better option, with the median monthly rent of $3,100. The average rate for New York 30-year fixed jumbo mortgage is 4.24 percent this week, according to Bankrate.com. Using those numbers, the monthly payment for a mortgage would be more than $4,500.

It doesn’t seem possible to me that the Singapore rate is a 40 year fixed rate. If it is the lenders are crazy (and likely to have huge problems). Instead it is likely a variable rate in which case the borrowers could be in for some real problems when interest rates increase. Calculating things at 1% gives extremely faulty views of affordability (using a variable rate mortgage).

If you are very certain you will move before 5 years (selling your property) variable rate might make sense. If you plan on owning for the long term, variable rate mortgage do not make sense, in my opinion. The super low rates we have not are only a matter of the governments trying to bail out the bankers and cope with the catastrophic problems created by the banking/credit crisis. The unsustainable rates might well last a couple more year (or might not) but the odds of them being here 5 years from now are vanishingly small.

Singapore Taxes Increase In Attempt to Cool Condo Prices

Posted on April 24, 2012 by Curious Cat

Singapore ‘Shoebox’ Condo Sales May Prompt Extra Taxes

Singapore has been attempting to rein in prices since 2009, when the government barred interest-only loans for some housing projects and stopped allowing developers to absorb interest payments for apartments still being built.
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Sales have risen as developers offer smaller units, according to CBRE Group Inc. The median size of apartments declined 24 percent to 667 square feet in the quarter ended March from the previous three months while the median price slid 18 percent to S$786,340, it said.

Foreigners and corporate entities have to pay an additional 10 percent stamp duty following measures introduced in December. The extra levy is 3 percent for permanent residents purchasing a second home and for citizens buying their third residential property.

The next round of cooling measures will be targeted at curbing investment demand from Singaporeans, CLSA, a unit of Credit Agricole SA, said in a report dated April 17. The evidence of strong investor demand can be seen in the overwhelming response to “shoebox developments,” according to the CLSA report.

“We believe the government could potentially introduce further cooling measures should the positive trend persist,” analysts Melinda Baxter and Xin Yan Low at Merrill Lynch said in a note to clients dated April 16.

The measure Singapore is taking are fairly strong. It is sensible to try and prevent extremely high prices. Singapore is already on of the most expensive places to live. It seems to me these measure are wise. And taxing foreigners is always a nice thing to do if you can get away with it (and Singapore can).

Another way to cope with the real estate demands in Singapore is to make it more possible to move into Johor Bahru, Malaysia. Singapore and Malaysia have been working on strengthening ties and economic cooperation. There is even talk of extending the Singapore MRT into Johor Bahru before the end of the decade. Those talks are still pretty speculative (though senior members of both governments have expressed support for the goal).

Gardens by the Bay

Posted on March 13, 2012 by Curious Cat

New Singapore Gardens soon to open near Marina Bay Sands Casino and Luxury Hotel. The greenhouses will allow plants from all over the world to be seen in Singapore. In June the first part of the park will open.

Transportation from Singapore to Johor Bahru Malaysia

Posted on January 24, 2012 by Curious Cat

To travel from Singapore to Malaysia there are several options, nearly all use the two bridges that connect Singapore to Johor Bahru.

Taxis can be caught at Queen Street to go to Johor Bahru. The taxis cost $40 to go to the dropoff point in Johor Bahru CBD. The taxi will wait for 4 passengers (making the charge $10 each) or you can pay the full taxi fare ($40) to have your own taxi. To go to a specific location in Johor Bahru the cost will be $50, or more.

Buses are also an option (see my post about taking the bus from Johor Bahru to Singapore). You can catch buses at the same Queen Street station with the taxis or at the Kranji MRT (subway) stop. You can catch long distance buses in Singapore or Malaysia to further points in Malaysia.

Taking a car is another option.

Here is a webcam to show you the current status of any backups at the causeway bridge (in either direction) and Tuas bridge. The connections between the cities get very backup up on major holidays and (especially the causeway) during evening and morning rush hours and weekend traffic (leaving Singapore on Friday and Saturday morning and returning to Singapore Sunday night).

Singapore residents travel to Johor Bahru for many reasons. Two of the most popular reasons are to shop and eat at the excellent and cheap (compared to Singapore) restaurants.

You can also catch the train (which goes over the causeway bridge).

And finally you can catch a plane to further away points such as Penang, Kuala Lumpor or Kuching.

Singapore and Malaysia have announced a subway which may connect 5 subways stops (to be built) with the Singapore MRT by 2020.

Singapore’s Green Corridor

Posted on December 8, 2011 by Curious Cat

The 26 km railroad corridor was decommissioned earlier this year. What is left is becoming an enjoyable visit to nature. As in many other countries there is great interest in turning the former railroad into a nature recreation trail. Singapore continues to make very good urban planning choices. It will be interesting to see the decisions the government makes in the next year for the future of the corridor.

Jumbo Seafood Restaurant

Posted on November 23, 2011 by Curious Cat

Jumbo Seafood is a well respected restaurant in Singapore. I have been several times and have found that respect well earned. The food is great. The service is decent but not as good as I would hope for.

Recently I enjoyed a very nice set lunch at S$38 lunch on Clarke Quay (I also took in the Dreams and Reality exhibit at the Singapore Art Museum, that day). Not cheap, but very good value for the cost in my opinion. The meal started with a set of 3 appetizers including chilled jellyfish which interested me. If someone told me the jellyfish was just noodles I would not have know the difference. I can’t say the jellyfish was very tasty, but it was nice to have tried it.

photo of jellyfish and two other appetizers

Jellyfish and two other appetizers at Jumbo Seafood

The corn soup with fresh fungus, and other appetizers where very tasty. The Lobster was also excellent.

Lobster tail - which was great.

I realized after I left I never received my Mango pudding (which was suppose to come with the meal). As I mentioned service leaves a bit to be desired. Still the food is easily worth the visit and I look forward to returning.

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