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Singapore Property Bubble Back With A Vengeance


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Was interested to read some of the London anecdotes on here yesterday, with the London bubble being pumped back up. Well I guees the hundreds of billions had to go somewhere.

So I thought it was worth mentioning Singapore for comparison purposes. It’s fair to say, the market has gone crazy the last few months. At the extreme, the ‘top-end’ newbuilds fell about 50% but by all accounts are back up 50% (ie 75% of bubble values, where prices were more extreme than London). In the mid-range market, which maybe fell 30%, it looks like prices have returned to the early 2008 peaks. The local market -- which is a kind of right-to-buy housing association scheme which caters for 80% of Singaporeans -- fell modestly and has rebounded modestly.

Rentals have lagged but after collapsing by 30-50%, have rebounded quite strongly – I’d say at least 20% from the Q1 lows, but probably more now. There's still a lot of empty inventory, but many LLs prefer to leave empty than let 'below market'. No, I don't understand that mentality either.

I was very skeptical about it initially, but turns out it is very real. No idea if it’s sustainable and hard to say exactly why this is happening. I imagine the same reasons as other property/equity/commodity markets. So on a wider level......

-Low interest rates (even by Singapore standards)

-Liquidity injection from global stimulus packages (banker bonuses going strong)

-General return of investment appetite

-Concerns over global inflation as a result of QE. ‘Need’ to be in assets.

-One significant difference from London is that the currency has been reasonably solid over the last three years, and the government is still in credit.

Local(ish) factors

-Asian (Chinese) appetite for gambling, and generally more volatile market

-Flight to safety, as in safety from the coming global tax clampdown. Singapore is probably the safest place to keep your money/assets in the Asia-Pacific region – as in the government won’t steal or tax it away. Singapore knows it’s finished if it tied to do that.

-More Indonesian, Chinese, Indian, even Middle East cash pouring in, and anecdotally, perhaps more European and US money (for the above reasons)

-Asian decoupling (China still doing well) being hyped up again, but I don’t see that lasting.

-Casino Resorts opening next year are going to attract huge amounts of money (laundering) ;)

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You should see the adverts for Equatorial Guinea on Bloomberg.

Apparently its whole economy has boomed due to its amazing Banking Sector. Apparently they have FINANCED just about all the projects going on there, and have a huge branch network, STIMULATING spending and credit.

In other words, evil bankers are lending to all and sundry again....it ALWAYS results in debt and instability.

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In other words, evil bankers are lending to all and sundry again....it ALWAYS results in debt and instability.

It would appear the banks are lending for certain things – such as buying back into bubbles. Fukk the real economy though, when there’s proper money to be made on punting.

I should also have mentioned one more local factor.

The media hype is back on, showing pictures of people queuing to sign up for new launches. This ties in with what is referred to as the kiasu mentality. It’s from a Chinese word for fear, or fear of losing out, but many would say it’s the overriding characteristic of many Singaporeans.

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It would appear the banks are lending for certain things �" such as buying back into bubbles. Fukk the real economy though, when there’s proper money to be made on punting.

I should also have mentioned one more local factor.

The media hype is back on, showing pictures of people queuing to sign up for new launches. This ties in with what is referred to as the kiasu mentality. It’s from a Chinese word for fear, or fear of losing out, but many would say it’s the overriding characteristic of many Singaporeans.

indeed, I can recall clearly the FEAR people had here in the UK, for years. This fear of missing the boat has been well learned. The recent puff in prices of UK property has reignited the the fear....I feel it still myself.

MSM are happy to exploit the fear. Bankers and property people do the same.

Now people are afraid of losing their money too.

Me, I shrug my shoulders, get on with work and appreciate that the hour long lawn mowing session on my rented house's lawn has only occured once since the beginning of July.

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Erm.... London isn't booming.

Just going by what I read on here. Admittedly, booming is a bit strong, but from this thread there’s a very clear shift in sentiment. Perhaps rebounding would be more appropriate. Take a look at the ‘When is the next phase coming’ thread and summat seems to be happening in London

I thought Singapore was a relevant comparison, given both locations are frequented by the bankers and their business-as-usual bonuses. But as I also highlighted, there are some more local features for the reigniting of the bubble.

http://www.housepricecrash.co.uk/forum/ind...howtopic=125639

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indeed, I can recall clearly the FEAR people had here in the UK, for years. This fear of missing the boat has been well learned. The recent puff in prices of UK property has reignited the the fear....I feel it still myself.

Yep, the old ‘last chance to buy or stay as rental fodder for ever'

It looks like the fear will return as the hype picks up, at least in the short term.

It’s such bullsh!t that people’s entire financial affairs will be decided on when they decided to buy (or could afford to buy) a house.

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