National Development Minister Khaw Boon Wan confirmed the existence of the housing bubble when he wrote on 22 Dec:
"Housing bubble and its inevitable bust bring huge misery to many... We cannot eliminate property cycle but we can try to keep bubbles less bubbly. This means taking away the punch bowl when the party is getting hot, much to the unhappiness of sellers and developers. But this is the right thing to do." The question that remains: is it too little, too late?
Fund managers Shroeders and Baring Asset Management are advising clients to avoid Singapore like the plague. Real estate and financial companies account for 47 percent of the Straits Times Index (STI), according to data compiled by Bloomberg. STI was the worst performing developed market this year, dropping 9.5 percent since May. Heading the plunge were property firms like City Developments (down 25 percent) and Capitaland (down 18 percent). Even rentals for Orchard Road prime retail space told the same story, nosing downwards by 2.1 percent.
Dividends from real-estate investment trusts lose their shine when 10-year US bonds climbed to a two-year high in September. Many of the property buyers come from neighbours like Indonesia, but IMF has lowered the growth target for South-east Asia's biggest economy to 5 - 5.5 percent this year and the next, down from 6.2 in 2012. "There's no driver to spur investment interest in Singapore," said Baring Asset Management's head of Asian multi-asset strategy, "The recent penny stock crash isn't really helping." He was referring to the $8.6 billion wiped out by three commodity firms in October, which happened under the noses of watchdogs Monetary Authorty of Singapore (MAS) and Singapore Exchange. As usual, the investigation is taking place after the horses have bolted.
On the brighter side of things, Samsung has launched a new TV that responses to hand gestures. Just imagine, when your pet hate politician comes on screen, you can raise a middle finger, and he goes off in a poof. No need to wait for another by-election.
"Housing bubble and its inevitable bust bring huge misery to many... We cannot eliminate property cycle but we can try to keep bubbles less bubbly. This means taking away the punch bowl when the party is getting hot, much to the unhappiness of sellers and developers. But this is the right thing to do." The question that remains: is it too little, too late?
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| S'pore fell from 3rd to 7th place |
Dividends from real-estate investment trusts lose their shine when 10-year US bonds climbed to a two-year high in September. Many of the property buyers come from neighbours like Indonesia, but IMF has lowered the growth target for South-east Asia's biggest economy to 5 - 5.5 percent this year and the next, down from 6.2 in 2012. "There's no driver to spur investment interest in Singapore," said Baring Asset Management's head of Asian multi-asset strategy, "The recent penny stock crash isn't really helping." He was referring to the $8.6 billion wiped out by three commodity firms in October, which happened under the noses of watchdogs Monetary Authorty of Singapore (MAS) and Singapore Exchange. As usual, the investigation is taking place after the horses have bolted.
On the brighter side of things, Samsung has launched a new TV that responses to hand gestures. Just imagine, when your pet hate politician comes on screen, you can raise a middle finger, and he goes off in a poof. No need to wait for another by-election.