Minister for National Development Khaw Boon Wan spoke honestly about his fears and worries over the feverish property market.
In his blog, Housing Matters, he warns that prices cannot go up forever and we should all prepare for the worst should anything go downhill. He's keeping an eye out for possible stumbling blocks along the way.
He mentions certain factors that could drive the market down:
Basically, he's asking for more caution from you before you sign on the dotted line. Do your financial homework and don't go in blindly.
That said, I think Singaporeans are more careful with their money than Mr Khaw thinks. What's more, most of the foreign buyers still are Indonesian, Malaysians, Indians and Chinese. The latter two nations are powering growth in this region and are one of the reasons behind the excess liquidity in the markets. Oil prices are already higher than they should be, and the weak Western economies don't seem to be dampening the exuberance in Asia. So unless something really nasty happens in China or India (Spratly Islands, North Korea, Taiwan, Kashmir), I think our property market will still be going on strong.
In his blog, Housing Matters, he warns that prices cannot go up forever and we should all prepare for the worst should anything go downhill. He's keeping an eye out for possible stumbling blocks along the way.
He mentions certain factors that could drive the market down:
- There is a large supply of units (53,000) coming in the years ahead, could point to an oversupply.
- Globally there are a lot of factors that could cause another global recession - the Middle East crisis than could raise oil prices further, the fragile European and US economy.
- If another global recession hits at the same time as the oversupply, we could be looking at a serious situation
- Low interest rates will not remain low forever.
That said, I think Singaporeans are more careful with their money than Mr Khaw thinks. What's more, most of the foreign buyers still are Indonesian, Malaysians, Indians and Chinese. The latter two nations are powering growth in this region and are one of the reasons behind the excess liquidity in the markets. Oil prices are already higher than they should be, and the weak Western economies don't seem to be dampening the exuberance in Asia. So unless something really nasty happens in China or India (Spratly Islands, North Korea, Taiwan, Kashmir), I think our property market will still be going on strong.
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