Below appeared in Friday's copy of The Business Times.
Reference: ABSD: Questions that beg for answers
Those who follow our blog will probably know our stand on ABSD.
So after reading Mr Ku's article (which posed some rather valid questions), the wife and I have a few questions of our own:
1. Does having "the most open economy for international trade and investment" necessarily mean investment inflow/outflow should not be moderated, even if the market warrants it? Or does it actually points to the fact that Singapore still has the least barriers to entry (ABSD notwithstanding) and one of the most transparent market around the world?
2. Would the "crash" in 2008-2009 be less severe if the Government had acted in 2007 to moderate foreign purchases of private residential properties, possibly with the implementation of ABSD?
3. And given the lessons learned from the spectacular price surge followed by an equally spectacular fall in 2007 - 2009, do we really want to wait for "shit to hit the fan" (again) before we start thinking about remedial measures? Prices especially for mass market homes have already surpassed their 2007 peaks, while buyers remains undeterred even after the ABSD is imposed (read: The Hillier?). And even if the % of foreign purchases in 2011 is nothing like that of 2007, it remains a fact that such purchases contribute to the escalating prices.
4. Have prices of industrial properties or offices been rising anywhere as spectacularly as private homes? To be honest, we have not been following the latest developments in these real estate segments.
5. How many of the so-called "high-skilled foreign families" actually buy a home for themselves to settle down in Singapore for the long term, rather than renting and moving on once their employment contracts end or once prospects in their home countries (or abroad) are better?
Oh well, maybe we just think too much... Have a great week ahead!
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6 comments:
Well, the author specialises in property services for high-net-worth clients, which I take to mean foreigners. Enough said
Hi Ursuladeux,
And we were told we are the skeptics! :)
1. How do we know if the market warrants it? Better to leave it to market forces to determine the equilibrium based on supply and demand.
2. Without the benefit of hindsight we would never know. Similarly, we will not know if ABSD is the right move, especially since the secondary market was already quiet before ABSD.
3. We should not be too concerned with new projects like Hillier. From The Real Deals, we can see that there are still 18,954 unsold units. That is more than total units sold in 2011. Clearly an oversupply situation is on the horizon.
Just my two cents' worth...
Hi Anonymous (18/1/12, 6:28PM):
The wife and I were at dinner with another couple who are parents themselves. The subject of corporal punishment (and its effectiveness) came up and the conclusions we had were:
1. We can never say for certain when is the "correct" time to apply corporal punishment and if spanking our kid is really the most effective way of instilling discipline (although there's a new study out there that suggests that spanking young children can help them grow into better-functioning adults). This is especially when there are other methods to do it.
2. But as parents we have to make a judgement call and be ready to intervene at the initial signs of trouble, rather than attempt to rectify the resulting problem later (which may be too late). We must also be prepared to adjust our method of discipline if the initial form doesn't work.
3. However, no half-a-decent set of parents will decide that they should do nothing and just allow their kid to "find his own equilibrium" or "allow society to correct him" on how he should behave, especially when the kid looks to be going down the wrong path. He may eventually finds his "equilibrium" by himself... but only after a stint in juvenile detention or worse, jail.
Too simplistic an argument when it comes to government interventions in the property market you think? We can just about hear shouts of "property buyers are NOT kids" from here... :)
I'm an advocate for spanking and even public caning in schools, just like the good old days! But in my opinion, we've become over-reliant on govt to make the right call for us. It's time for govt to be less paternalistic. Just focus on making public housing affordable. Way too over-priced now. If DBSS sells for 500-600+ psf, EC sells for 700-800+ psf, it's no surprise that mass-market condos start at 1000+ psf. It'll be more effective to lower the floor price thru cheaper public housing.
Hi Anonymous (18/1/12, 10:31PM):
You reminded us of something that MP Indranee Raja said (during the Ministerial Salary Debate) in Parliament today: We (PAP) are looking at this from the top down while you (The Oppositions) are looking at it from the bottom up. But at the end of the day, we all arrive at the same conclusion.
Probably not exact words but you get the gist of it. :)
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