Wednesday, 15 August 2007

Is Singapore Your Oyster - Proximity and Amenities

Most agents, pro-sale owners and even Mr Mah Bow Tan, would point out that should the sale proceeds be insufficient to afford you a similar location home, you can always move further afield where properties might be cheaper.

A Voices letter in Today Online raises an important issue - what intangibles do you lose when you move "further afield"? The letter by Mr Francis Hong (reprinted in CondoSingapore here) is about 500 patients who petitioned to HDB to retain their family GP when they are forced to relocated for a SERS (Selective En Bloc Redevelopment Scheme) on their estate. Mr Fong points out that the need to be close to certain amenities is not one of luxury but "one of necessity".

What amenities do you lose when you are forced to move away from a community that you are familiar with? How do you calculate the loss of such intangibles, when factoring in what you'll get from the proceeds, and what you'll lose from your home?

Some examples:

For children: Parents often relocate to within a certain boundary around a school of their choice, so that there's a higher chance of their kids going to that school. They have to, without any choice, continue to stay in the same area for their childrens' future.
For parents: Any parent with more than 1 child knows that if they have to send their kids to school, they want (a) their kids to be in the same school/kindergarten ideally (b) a school/route that is convenient for them, enroute to work ideally. Moving home will disrupt this, often requiring that they wake up earlier just to get the kids to school on time.
For elderly: Psychologists have pointed out that as you get older, you want to have familiarity around you. Grandparents hate it when kids come into their homes and really mess things up. Likewise, when old people venture out, they need familiar routes, places, landmarks. Moving home is disruptive, and often traumatic.
For families: Loss of clinics that they have been with for decades, loss of friends and neighbours, people who'd keep an eye out for their homes when they're away on holiday.
For working adults: Unless you move to a home nearer to your place of work, chances are you'll have to device new routes to work. Further afield may well mean longer travelling time, more traffic to encounter, and waking up earlier/coming home later.

These are very real factors that will affect you if you move home, whether by choice or not. These are very real reasons to think about before you decide to enbloc your home or not. I know of people who have spent the past 6 months trying to find a new home for themselves, visiting flat after flat to no avail. Perhaps in 3-4 years' time, one might find a glut of new units flooding the market, but there's no guarantee that prices will not escalate beyond your reach (a very real possibility).

Do you cherish the conveniences and necessities that you have taken for granted, things people and places that will disappear at the stroke of an STB approval?

13 comments:

renaissancerebel said...

Good and valid points raised Dr. Minority. I would also like to add to your points, the environmental issues.

Dismantling perfectly good housing and rebuilding these less than 50 year old buildings with more steel and concrete is a complete waste of good housing material and resources .

HOw much of these housing material are recycled ?

The dust, the noise pollution on a little island where there is constant non-stop construction, and every corner is a construction site , the sort of stress , noise and air pollution will take its toll never mind the actual stress of finding a new home and getting adjusted to new environment constantly.

Environmental stress could cause a host of chronic diseases from asthma, execema, cancer, heart problems , psycho-neuro disorders.

When will Singapore stop being a theatre of shifting props?

Anonymous said...

"When will Singapore stop being a theatre of shifting props? "

when it comes time for Singapore to be relegated to 2nd world or 3rd world..

then everything can remain stagnant and passive..

till then, its CHANGE CHANGE CHANGE!!!!

Anonymous said...

Typical Singaporean mentality, unfortunately. We only think that all the good times we are having the past years will continue to get better and better with each passing day. Wake up!!! Look at what is happening to the world stock markets for the past 2 weeks. Is Singapore immune to such external shocks? You talk about property prices continuing its uptrend even with all these bad news happening around us, Dr Minority. Don't you read the papers or listen to the news??? Oil prices are climbing, the subprime slime is affecting credit all over the world. The China stock market is the only one not affected by the rout at the moment. But can it hold for too long? Then there is also the yen carry trade problem. Pls don't pull wool over everyone's eyes here. Unless you have a solution to all these problems, don't paint a bullish picture of the local real estate industry.

Dr Minority said...

>>>Unless you have a solution to all these problems, don't paint a bullish picture of the local real estate industry.<<<

You and I don't have a fairly accurate crystal ball. We cannot predict whether the market is going to continue its uptrend, despite the problems in the stocks market, oil prices, sand prices etc. For example, recent property experts have pointed out that the subprime problems will not affect the local property market. Do we take their word for it, or are they trying to soothe fears that the bubble is bursting? You and I do not know.

What I DO know is this, that despite the subprime problems and everything else you correctly mentioned, property agents are sticking to their picture of a booming market. I attended a recent presentation where yet again, I see the same rhetoric - property prices are continuing to go up, the market is on the up and up, BUT (there's always a but to scare people into signing early) do you think it'll be sustainable? Whether you do or not, agents will say NOW is the time to enbloc your estate, to capitalise on the bullish market.

If this wasn't the case, we wouldn't be seeing more and more enbloc attempts this quarter (ie those in the En-Bloc List that are ongoing).

We can only predict with 100% on hindsight. Until then, all I can say is that agents have a particular rhetoric about the market that is oddly out of sync with the reality, as described above. Even that you cannot deny, I'm sure.

If you have a superprime estate, then history has shown us that such estates will weather property booms and bursts. If you don't, then you need to make your own choice whether now is the right time to sell or not. If you value your home, then you need to choose between selling it and face a volatile property market (as you suggest) or keeping it and waiting for all the dust to settle.

rebelrouser said...

The question at the end of the day is really what do Singaporeans want for a home? Only you yourself can answer that question.

A home that you could feel secure and safe to bring up a family. A home with memories to reminisce in retirement. A home you could be proud of because you earned it and a symbol of your own effort.
If your enbloc sale could buy you a better home , security and better lifestyle , nevermind how much your neighbour or the other folks in the other condo got for theirs, then be happy and go for it. If ou think you are happy where you are and don;t want to change then fight for it!

The sad fact is Singapore is land scarce, no amount of reclamation can accomodate the growing population. We all want comfortable nice homes but if the law is such that all our condo homes are effectively going to have no more than 10-20 year lifespan before it becomes a target for redevelopment, then does that give us any security or sense of belonging or identity or memory?

Alternatively, if that is all acceptable as change, then change our outlook and accept that we will be transient nomads, global nomads who are brave enough to expand our mental and emotional borders too.

Take your money and go out and buy your dream home in the world. Do reverse colonisation. Buy in Florida, Spain , Italy (for those who love their own vineyards ), France,Taos..

GSIC invest our CPF abroad, then should we not do that too?
INvest in our dream home which we will never be able to realise in our tiny island.

Lots of Singaporeans who are expats or even the well heeled are already doing that. NOw is the right time with all these subprime mortgages going belly up, rich pickings for all who want their dream home, so take your cash and wait for the right time to buy abroad!

Think big and stop bickering over how much you could get from your enbloc sale, think what you want to do with it! Expand your horizon and go live in a different country , explore beyond this tiny island..enjoy another culture another idyllic life , you deserve it after all your toil and trouble!
The world is your oyster , all it takes is a little grit and you could be the pearl in it.

WE have only one life, live it well- motto from my gym in London!!

Anonymous said...

>>> Perhaps in 3-4 years' time, one might find a glut of new units flooding the market, but there's no guarantee that prices will not escalate beyond your reach (a very real possibility).<<<

Well, you seem to think the way of these agents, don't you? That prices will continue to rise over the next four years based on your own posting above. Yet you contradict yourself when you say that you cannot predict the direction of the property market in your subsequent reply to my post.

You claim that superprime properties can weather booms and busts. Correction! Not only superprime properties. Any property will also weather booms and busts provided the owner does not have to force sell.

If an estate is aging, especially those over 25 years old, it is a matter of time before it has to be taken down. So enblocing now is timely(hope it is not too late)since the market is still euphoric.

By the way I have spoken to many ptoperty agents and they tell me that response to their ads even for properties in D.09 is muted.

Anonymous said...

>By the way I have spoken to many ptoperty agents and they tell me that response to their ads even for properties in D.09 is muted.

Your ptoperty agents not very good leh. My place went enbloc already. I get CONSTANT ANNOYING phone calls from agents asking me if I need a replacement home. ALL my sale committee members have brand new EUROPEAN CARS. Business is booming because there are thousands of families now looking for new places to stay. So maybe you should tell your agents to work harder?

And you say market is euphoric but you SCOLD Dr Minority and accuse him of saying market is euphoric?

Pot Kettle Black?

Excuse me, are you a ptoperty agent? Maybe that's why your buddies all tell you muted, to suan you!

Anonymous said...

I was making a point to Dr. Minority that if he feels the market is euphoric, it is time to sell now and not hope that prices can go higher in the next four years and try to enbloc then.

Well, everyone makes a typo once in a while and that includes you. It is not such a big deal is it?

Anonymous said...

>I was making a point to Dr. Minority that if he feels the market is euphoric, it is time to sell now and not hope that prices can go higher in the next four years and try to enbloc then.

So you say (not Dr Minority) that the market is euphoric now. Then you say in your original comment that Armageddon is coming (subprime oil China), so better to sell now and cash out before the bubble burst right?

By your logic, then i ask you this - why not cash out now independently? After all, the world might end in a few months time, so sell your unit now to a private buyer. Why wait for 1-2 years to cash out through an enbloc?

Simple answer - because people are greedy.

Anonymous said...

Aiyah. Someone's stocks crashing badly lah. Need to liquidate his home urgently. So trying to convince pple to sell thru enbloc so he can recover some money mah.

Anonymous said...

To Anonymous of 16 Aug 13:06, 18:33, 19:05:

I think you are one damned confused individual. One minute, you say the market is all gloom and doom and the next minute, you say the market is still euphoric. Who is the one making contradicting remarks?? Stop putting words into Dr Minority's mouth. You may want to seek professional help about your confused state of mind.

Dr Minority said...

>>>You talk about property prices continuing its uptrend even with all these bad news happening around us, Dr Minority.

Many thanks for your comment, Anonymous. Perhaps I should explain my beliefs about home ownership. I do not believe a home is purely a financial asset. I believe it defines a person's identity and his/her/their attachment to community and nation. I take the long term view that if a person buys a home to stay in, (not as a short term investment), for a period of at least 20 years, that value will *in all likelihood* appreciate. Of course, by how much is the relative question, but the fundamental stands. Now why shouldn't a person stay that long in an estate? Because "if an estate is aging, especially those over 25 years old, it is a matter of time before it has to be taken down"? I disagree strongly with this point. Many estates, if taken care of meticulously and properly with a long term view of keeping the estate maintained for a period of 30-50 years, can achieve it. One need only look to the first world cities to see that being realised. 25 years in global estate terms is YOUNG. So why is it allowed to be run down? Because people are short sighted, do not build up a substantial sinking fund in preparation for upgrades. Because the idea of enbloc after 10 years is a carrot that is too attractive to people.

So if you look at a property you bought in 1982, 25 yrs ago, and you were to sell it now, you're probably right that "any property will also weather booms and busts provided the owner does not have to force sell". Yet that's the key point isn't it? If you sell, should it be your decision, or should it be a decision taken away from you?

So to answer your initial critique - do i believe in an uptrend? Yes I do, despite the current fears of a meltdown. But only because I believe in a long term view in terms of decades.

You are entitled to your beliefs about the current market. Everyone has their own, often religious, beliefs about whether the bubble will burst or whether we're just seeing the beginning of a golden era for properties. But like one commenter rightly pointed out - if the fear that the euphoria will end, would it not make sense to minimise risk by selling your unit now (even capitalising on the 'enbloc potential') than take the riskier route of going enbloc, which can take at least 1 year if not more (STB hearings, court trials)?

Anonymous said...

"I was making a point to Dr. Minority that if he feels the market is euphoric, it is time to sell now and not hope that prices can go higher in the next four years and try to enbloc then. "

stock market crash is just a planned market correction tahts all.. next year is 2008.. year of US elections and beijing olympics + singapore F1 first night race..

next year is the golden year for not just singapore but all the globally connected cities of the world

HUAT AH!!