Just a month ago, on 19 May 2010, I wrote that it's time to get ready money to invest in property, or to upgrade to a higer value property. Today's business times and straits times reported that developers' sale of new units has slowed by almost 60%. It comes to show that supply of new units have excess over demands from the buyers.
Yesterday, an agent sms me to consider a $1.355 million 16th floor 3+1 unit 99 years unit in Kovan Residences. Upon receiving that sms, I checked the ura website for transacted prices and found that the units with similar sizes of 1760 sqft was sold only at about between $1.08 to $1.2 million. The asking price is about 20% or 30% above what was transacted about a year ago. That's ridiculous, isn't it?
Well, if you never forget what Mr Buffett said, "Be fearful when people are greedy and be greedy when people are fearful." I feel that this is the time when people are greedy. This "greed" started 5 months ago in January. This is the time to be more patient as before, and to gather all our ammunitions, i.e. $$$, so that we will be able to strike when people are fearful. This time should come soon, maybe by the end of this year.
There has been reports that smaller units were snapped up the very day it was launched. Don't these people have to really consider the direction and facing when buying properties? These may be the reasons:-
1. If I do not buy now, I will miss the boat.
2. Since everyone else is buying now, the price should be going up later.
3. It's still under construction, hence my monthly installment is peanuts.
It's right that one has to pay only a few hundreds of dollars monthly under the progressive payment scheme. For example, if an individual buys a $1.1 million property, the first three years of payment is about $350 to $900. Only upon TOP, the buyer will need to pay $2600. However, think twice, will I be able to pay the $2600 monthly after TOP?
Let's think about it. The properties under the deferred payment scheme a few years ago will get their TOP this year. Those properties were launch 2 to 3 years ago. That was the time when people just buy the properties without considering, because they have the mentality that I only to pay 5% cash, and 15% from CPF monies, and the rest after TOP. I am currently following a few properties that were on deferred payment scheme, and are going to TOP this year. I believe these properties will be the ones that will create panic selling towards the end of this year.
So what am I doing now? Just need building up my warchest and ammunitions and have the patience to wait for the right time to strike.