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  1. #21

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    May 2007
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    Whoops, missed that liked.

    There are many - due to conditions placed on developers when buying property, they need to build and sell the units in a specified timeframe, otherwise they have to front the costs themselves. There's a build up in inventory at the moment in SG and December showed new home sales at their lowest levels in five years.

    Aus loans are generally 25 / 30 years in length and SG rates usually kick up after around the third year (a couple of years ago they were trialling 50 year mortgages... which the govt wisely put a stop to).

    You are able to borrow in different currencies, at lower rates. In HK, you can borrow in HKD or USD at rates between 2% - 3% at a 70% LVR. Though, this opens up exchange rate exposure.

    A falling Aussie dollar does have positives, such as more Aussies holidaying and spending more money with the Aussie economy (instead of going abroad) and it makes it a cheaper holiday and education destination (and also helps the local manufacturing industry, which was hurt when the Aussie dollar was above US parity)... and property becomes relatively cheaper, too. Aus also has a very strong migration rate and a dropping rate of people per household - meaning more demand for property.

    I agree - Singapore is a well run (and transparent) economy and will do well in the long term. I like the buying opportunities available at the moment, being at the bottom end of the market, meaning opportunity for an upswing.

    I like both destinations, but not all options in either!


  2. #22

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    Nov 2014
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    How can Singapore rates kick up after the third year? They are sibor based, I believe.

    I wouldn't want to borrow HK$ to pay for a flat in Australia or Singapore, because of the exchange rate exposure. In Singapore I can borrow 80%, but only up to 65 years of age, so the monthly payments are higher than the rent. But since I expect to use the income from the rent to support my retirement, I guess this will do as well, and it makes perfect sense.

    Of course the lower A$ is excellent for buying a property. It has dropped by 30% from the top, which is great! However, in Australia I can only buy new properties, because I am neither Australian nor resident. These are likely to be 10-20% or so more expensive than older properties next door. Since I buy to rent out, and not to live in, I don't care if it's new. So, wouldn't it make more sense to buy a second-hand property, maybe one that is already 10 years old and has lost its luster, but whose value is unlikely to fall in the future? And I can't buy those in Australia.

    About the interest rate, do you know the historic difference? 4.5% in Australia v. 1.5% in Singapore is a big difference. Why such big difference?

    In Singapore interest rates were much higher in the past: Will interest rates go up any time soon?

    Were Australian interest rates always higher than Singaporeans, or at some point they were lower? 3% more is quite a difference!!

    Plus, what do you think is the best place to buy in Australia? I read that Melbourne is having an oversupply of housing, so further growth is very unlikely. The same is true for Sidney. Perth is suffering from the mining crisis, which I don't know when will be sorted out. Maybe never?

    Last edited by Liked; 20-01-2015 at 10:00 AM.

  3. #23

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    May 2007
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    Jus the way the SG loan market works generally. You'll have an intro rate for say 3 years, then a higher rate for the remainder of the loan. Essentially (every loan is different) the first three years are SIBOR + 0.82% (or whatever it is) and then for years four and above it will be SIBOR + 1.25%. There may also be a sliding scale for the increases.

    In that article you referenced, it says SIBOR is influenced by the US rates, which are tipped to rise. Australia's interest rates are based on the Cash Rate set by the Reserve bank (currently at 2.5%), the customer ends up borrowing at around 5% (can get lower, but 5% is a good benchmark). The Cash Rate is tipped to be cut this year, making end user rates also cheaper.

    The price is relative - a second hand property may be cheaper, but this comes with lower rent (similar yield is possible), more chance of repairs and of one off expenses, less appealing to tenants (compared with new stock). It's a bit more hands on (though a good rental manager will keep everything in order for you). Throw into the mix depreciation claimables and what you're able to claim against your income to minimise your tax exposure.

    Also, check out the yields - SG generally has yields between 3% - 4%. In Brisbane, for example, it's relatively easy to find new projects with 5%+ yields.

    For historic interest rates, check out google data - loads of fun to be had there (you can spend hours comparing different data sets).

    Then there's the debate between freehold and leasehold property - the list of variables is long and have an interesting effect on your investment. That's why I created an investment game - let's you explore different options and scenarios and see how they play out in the long run.

    For the best place - there is not one single best place as there are so many variables. Melbourne has a decent amount of new stock, but also strong population growth rates. Try looking at Brisbane - good yields, current strong pick-up of completed stock in the rental market and a low entry point compared with Syd and Melb (can get in for around HKD $2m).

    As always, do your research.

    Liked likes this.

  4. #24

    Join Date
    Nov 2014
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    853

    Thank you.

    You seem to like Brisbane. What do you think of Brisbane Skytower Brisbane City, 222 Margaret Street, Brisbane City, Qld 4000 - realestate.com.au Or can you recommend some particular properties you find good?

    Or maybe one off the shelf at ipglobal, such as AQUA Newstead Central | IP Global Ltd? Have you heard of ipglobal? Are they ok?

    It's true that paying a 20% tax on the purchase of the property (in Singapore) is rather steep. The S$ has also been doing very well, and Australia is actually one of those countries I could envision retiring, while Singapore definitely not.

    Actually it seems to me that in Singapore you get a 3% yield with a 2% mortgage interest rate, and in Australia you get a 5% yield with a 5% mortgage rate?

    Thanks for your comments!!

    Last edited by Liked; 20-01-2015 at 05:34 PM.

  5. #25

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    May 2007
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    I like Skytower - it's a major plus for Brisbane's Skyline. I also like South Brisbane - plenty of lifestyle options, tafe, and students, close to UNIs, on the river with very good public transport (for Brisbane, not on HK level!).


  6. #26

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    What about Malaysian property?


  7. #27

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    May 2007
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    What are your thoughts on Malaysian property, Paxbritannia?


  8. #28

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    Quote Originally Posted by Liked:
    Any news about this? Does anybody want to update with some deals and/or discuss something related to properties? I still have 1.5 M. I don't know what to do with, and I am looking for overseas property investments.

    Cheers.
    I will PM.you my account details. Thanks.

  9. #29

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    Feb 2009
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    8,280

    I bought in Malaysia (KL) a few years ago off the plan. They are still building it but should be complete this year. There is a government scheme known as DIBS (developer interest bearing scheme) which means I haven't paid a cent in interest the last two years and the mortgage repayments don't start until I take possession of the property. So I bought at 2 years ago prices and today they are selling some remaining flats in the development still off the plan but at about 1.5 times the price I bought. So I think I made an OK decision on this. The project is due to complete this year and they have a website they keep updating with construction photo's so I can check the progress.

    Two years ago I took the plunge. Today I am hesitant. I have the funds to buy again, foreigners are allowed to buy 2 properties in Malaysia, I have been looking around Johor Bahru (near Legoland). But I have not taken the plunge because I am worried about high prices and too much supply. But I might still do it anyway because I'm itching to do something and I'm not aware of any other opportunities around with less risk.

    Regarding Australia, I have a few properties in Perth, and yes there is a bit of a downturn at the moment. One property I have in South Perth that I was renting before for AU$390 per week was vacant for the last few months and I have just let it out for $340. (Ironically its to a fly in/fly out mine worker which is strange because it's quite close to Curtin University and it's usually been Asian students renting it before).


  10. #30

    What do you guys think about Jakarta ? with its new government, strong middle class spending, young and big population, hopefully near bottom rupiah