When the crunch comes

Seah Chiang Nee wrote the above article in his Littlespeck blog. He is reading the warnings by the political leaders of an impending recession coming Singapore’s way and how it will impact the people.

The worst hit will be the PMETs, especially those with a million dollar or half a million dollar mortgage. What will they do if one of the paymasters got retrenched?

Don’t forget that there are many who have several hundred thousand dollar mortgages in HDB flats. There are many Singaporeans in this category which includes many PRs as well. When the crunch comes, when they lose their jobs, the 30 year mortgage will not go away. They all depend solely on their monthly incomes to service the debt.

I reckon this time the impact will be much greater as the outstanding housing loan sizes are much bigger, all expecting a 30 year free ride without having to worry about any financial crisis.

Just a few months back, it was all sunny skies and full of optimism. Dark clouds are forming overnight.

Be frightened, be very frightened.


Matilah_Singapura said...

So what? Another recession. Big deal lah.

By now some more will have figured out how to "benefit" from the situation.

Crunch is good. Deflation kicks ass!

Crisis. Danger. Opportunity.

Chua Chin Leng aka redbean said...

Right time, right place, right position.

Now, I mean financially prepared. Don't think of anything else.

Anonymous said...

If they are smart, recession or not, the whole financial engine, and the right policies adjusted, will fire up to ride out the recession with the property market unscathed or it's value, intact.

I don't see how the property cycle benefits a small nation in the long run. Speculators,however, welcome tthe crash for obvious reasons.

Anonymous said...

It surely is not as bad as it is painted now, there are many schemes that can be formulated for housing loans and repayment. Rest assured that the talents in our leadership are no flukes.

As pointed out by Matilah; some do make use of crises to avail themselves to opportunistic schemes.


Anonymous said...

Yes, so what?

Should we worry about them? They should know how to cut their clothes according to the cloth. If they want to over extend their resources and hope to cash in expecting the economy to be purring along relentlessly, that is a bet they have taken and it is not for us or even the Government to help or worry about.

If the Government fails to even help the poor, what justification is there for it to help the well heeled? Not that I expect any help to come from this Government.

After all, most of these people are the ones with the resources to keep pushing up property prices to the heavens and reaping the benefits.

Crunch is good. I am all for it.

Anonymous said...

71-year-old seah chiang nee has been in the employed of the star newspaper in malaysia since 1980. all of seah's weekly articles about Singapore has always been 100% negative.

Anonymous said...

Market crashes, majority will be hit be more job losses and business failures and the poor, and the average joes, are definitely worse off. However, the crash is good for opportunists and the rich.

Anonymous said...

When the crunch comes down hard on the people who is to be blamed and who must shoulder the responsibility.
As far as public housing and to a certain extend private housing people at the market place the blame and ultimate responsibility on the government and the ministers. The people claim that the government has for years been acquiring land banks at dirt cheap prices but selling build up flats at market rates. The government also sells acquired lands to private developers at high tendered prices making huge profits. Perhaps this is how the city state derives its huge reserves. In the meantime rich foreigners continue to make humongous profits at the expense of Singaporeans through buying and selling and intense speculation. It is common for foreigners to buy tens of units or even whole blocks of private developments and then in no time dispose them at many times their purchase price. Where do local Singaporeans stand a chance under this scenario. Few locals manage to purchase them during the launching of a project but they usually end up carrying the baby for decades with huge loans at high interest rates.

By and large the government makes a few policy mistakes. In public housing the government is wrong to meximise profits at the expense of the people. It should not have allowed permanent residents to buy government flats. In private housing developments stringent rules should have been set up to prevent high speculation for huge profits. Foreigners should not be allowed to sell their purchases within the first five or seven years of their purchases.

The policy of paying illogical high salaries to ministers and certain categories of senior civil servants and the high charges of ERPs, transport, Public Utility Bills , high hospital and medical bills and GST has a great effect of spiralling up the rising cost of living and an insidious negative cumulative effect of affecting the ability of Singaporeans in paying up their high housing loans which normally stretch up to a repayment schedule of a few decades.

Singapore policy of pleading and pursuading the Evil Empire USA to come and meddle in East Asia and South China Sea issues is a tremendous blunder which will cost ASEAN deadly especially Singapore. Singapore should not be too clever and always want to speak louder than others and punching above its weight. A wise person and a wise country should know where its true position is. Historically US has always been a blood thirsty nation and its territorial expansion has always been through brutal and savage conquest of other countries beginning with the savage carnage and extermination of the American natives. In short US development and expansion is always soaked with the blood of other people. Our government should know better that USA troublesome interference in Asia will cause great political tension everywhere which is no good for the Asian economy. US is falling apart from its own economic and financial woes . It is unwilling to go alone into its moribund death but despically it wants to drag others along. Singapore's coming economic and housing crunch will be part of this scenario of US aggression in Asia. And because Singapore government has been instrumental in pursuading US to come to East Asia to contain China though for spurious reasons it holds the blame and the final responsibility to Singaporeans if the crunch does come around with a deadly force.


Anonymous said...

Ignorant people, the myopic and those who scheme for PAP downfall want to see our housing market collapse or its value fall.

Truth is, high value of homes is good for the majority so long as we keep it stable and on the firm side

Anonymous said...

Why is Seah's articles about Singapore perceived to be 100% negative? If I am not wrong, he was a Straits Times journalist before switching to The Star.

Negative or not, his articles reflect the sentiments on the ground and are, of course, not palatable to our rulers for sure.

A dose of alternative 'hard truths' now and then is not too much.

The said...

/// Anonymous said...
71-year-old seah chiang nee has been in the employed of the star newspaper in malaysia since 1980. all of seah's weekly articles about Singapore has always been 100% negative.
November 28, 2011 3:02 PM ///

Shooting the messenger?

The question is - does what he writes make sense?

Or you prefer that he follows the Straits Times and puts a positive spin in even the most negative facts?

Chua Chin Leng aka redbean said...

If Seah Chiang Nee is telling the true picture of ground feelings and perception, what's wrong with that?

This is not an issue of his articles being positive or negative. For those who want to listen only the good news and things positive to feel happy, there is one place they can go to read those happy news.

Anonymous said...

The problem the PAP is facing is that it is surrounded by people who will only tell them the good news, and think everything is fine.

Anonymous said...

Till today they are still telling the people that public housing is affordable. Mark my words, when the crunch comes.

This is something to hold them responsible and to squeeze their balls for claiming it to be sold.

Anonymous said...

Of course HDB housing is affordable. Buy within your means. Price starts from less than the price of a COE( how cheap can you get huh?)

Anonymous said...

Remember the theory of boiling a frog to death. They keep adjusting to the new high and think it is normal and comfortable.

Anonymous said...

Deflate prices and DIE

Anonymous said...

Leave it to the PAP. 46 years of propagating 'hard truths' and they are immune to shame.

When the crunch comes, the taiji masters will blame the global recession effect. Nothing is ever wrong with their policies and strategies.

If we escape the crunch, everything rosy is credited to our great talents who are able to plan and think years ahead, as always. Nothing to do with the global recovery.

Anonymous said...

Rain or shine, our city will always be prosperous.

Anonymous said...

No guesses who stands to profit most from the lean times. The brotherhood. I thought they were crazy when so many of them traded in their city jobs for farming. Now who is having the last laugh?

Matilah_Singapura said...

Kani nah,

I remember in 1995/6 my friends were fucking me for not going long on property.

"Better buy now! Last chance...prices going out of control sky high!"

Yep. Them were the days when HDB point blocks were in excess of 500k, rentals were thru the roof -- I was paying $4k for my condo. Lucky I was on an "expat package" -- a small time one. One US financial attorney was paying 20k for her digs in Coronation Rd, and other expat high-flyers around 30k for their "black and whites" in district 9/10/11.

I told my friends: "Sure crash one lah. And you'll be able to buy HDB for substantially less."

Sure enough. Within a few years semi-d's and other landed property dipped well below the one million dollar mark.

...and it will happen again.

Crash and burn baby! I will be there fanning the flames, and if necessary pouring gasoline on the fire :-))

Matilah_Singapura said...

Boom Chicka Wah Wah Bitchez

Nature pulls out its Big Cock and gets ready to mercilessly FUCK PEOPLE UP THE ASS.

Oh how I love a good dose of Economic Pornography and Financial Sodomy!

Anonymous said...

We can see that you enjoy masturbating on chua's face.

Matilah_Singapura said...

@anon 733

Hey dude you might also enjoy lemon party dot org harharhar ^-^

Anonymous said...

Some property consultants are predicting prices will fall by 30% come 2015.

We, and market players, are RUBBING OUR HANDS and hoping for the WORSE - 50% drop or more please!.

Anonymous said...

Better still if the government and all idiotic Singaporeans collapse with the market

Anonymous said...


And with that collapse goes the 'upgrading to increase the value of your HDB mantra'. They sold the idea, they benefitted from the idea politically in the last two decades and the majority of the idiotic Singaporeans will be left to suffer.

Anonymous said...

Crunch? What crunch?

Singaporeans are still sitting pretty on the merry go round. Some are on the ferries wheel, still shouting - way to go, and up, up, up.

Right place, right time, so rosy.

Anonymous said...

"Some property consultants are predicting prices will fall by 30% come 2015. "

You must be damn kidding me, right ?

All it needs to bring the property to all-time higher, higher and higher is to continue to open float gate to foreigners rich and poor so to allow them to speculate the property price and buy them (even though they may not be able to pay them in due time.... but hey, they are foreigners and if they can't pay, just return to their country and never come back !!! and the Singaporeans cleaning their shit !!!!)

get it ?

Surreal ? Your guess is as good as mine !

The said...

/// Be frighten, be very frighten. ///

Aiyoh redbean, your England not vely powderful leh.

First, you don't have the gift of the gap (sic).

Now, you should be frightenED, be very frightenED.


Chua Chin Leng aka redbean said...

Thank you The. Corrected. My apologies for writing bad English : )

Chua Chin Leng aka redbean said...

When the ballon is blown to such a size, and still hoping for it to go bigger, when it bursts, the govt has no where to run and no where to hide this time. The buyers read all the queue from the govt that property prices can only go up, and it is like a govt policy.

And there are many quarters warning about this demise that is going to hurt a lot of people. Claiming that it is an international problem is not going to get them off the hook.

I say again, it is pure madness to make people pay so much just for a roof and 4 walls to live. It is not even a house, not freehold.

Matilah_Singapura said...

@ redbean:

> I say again, it is pure madness to make people pay so much just for a roof and 4 walls to live. <

The whole darn political system rests on this, tied of course to the tax-funded legal Ponzi Scheme -- the CPF.

As long as the PAP Puppet Masters can play this, any opposition has NO HOPE in wrenching power.

Of course the "true believers" enjoy their intellectual masturbation over their "dream" to get into power.

In 2016, opposition-wannabes (for e.g. Ken Jeyaratnam) will still be masturbating and the PAP will still be the ones doing the REAL FUCKING...of the people of course.

Bend over and take it from the government you deserve!

Chua Chin Leng aka redbean said...

A lot of people did not realise it, the abolishing of estate duty on property is a major factor that allows the big players to stash their money in multi million properties when they know they are not going to pay anything if they bunk off.

Bring back estate duty and see if they dare to play property to the current sky high prices. This is another flaw policy that dismissed the age old wisdom of estate duty.

As a modification, allow tax free estate duty up to $5m. Anything more, tax accordingly.

Matilah_Singapura said...

Not true.

The market has crashed before.

Death duties are another form of tax. If you penalise the "rich", you also penalise the "not-so-rich".

Most sensible people want to leave their property to their loved ones. The govt should not interfere with this at all.

Becoming rich over several generations is a good and moral thing. Usually by 2nd or 3rd generation the money is gone...but some families are able to hang onto their wealth for several generations.

Having wealth is definitely better than having no wealth.

Matilah_Singapura said...

P.S. You are going to see high property prices when the money supply is loose -- that's basic Law Of The Universe.

You are also going to have high property prices as long as there are lots of people who can buy around.

As far as I'm concerned, I will be cheering on the govt in power -- whoever they might be -- to keep the borders open and allow any one who wants to settle in Singapore to do so freely, with little encumberances by the state.

If they can overcome the natural encumberances imposed by the market and by nature -- like high property prices, over crowding, traffic jams, packed public transport...then for fucks sake leave these people ALONE to "pursue their happiness" and stop being a motherfucking, unfriendly, anti-social bigoted asshole.


Welcome to Singapore, you sad, smelly unwashed masses. Good luck to you!

Anonymous said...

We already have a million of the smelly stuff.

Anonymous said...


"The latest reports were analyzing the prices of stock prices and real estate investment trusts and were not intended as guides for home buyers. However, should their predictions on real estate prices turn out to be correct, it could be good news for families that have been waiting for a better deal before they buy – and of course bad news for anyone that has just invested in a home in Singapore."

On the contrary, speculators are rubbing their hands. These are homeowners/investors already cashed out and waiting for market to crash so they can get back into the market and ride the next wave of high and then low again cycle.

In fact, the rich/speculators are very happy with the coming crash. They even have a hand in the boom bust cycle.

So don't feel sorry for them :)

We are going to plunder all the average people.

Chua Chin Leng aka redbean said...

The speculators invariably are the rich and the foreigners. The serious home buyers are the average Singaporeans who ended up being fleeced.

There are some slightly average Singaporeans who are also benefitting. The rest, the big losers, are the bulk of the Singaporeans.

Great job. Great scheme. Great for the economy.

Anonymous said...

All that great education without the cycle of boom and bust is not going to get you rich.

Boom and bust actually work in the interests of the savvy investors or opportunists.

Happy for the minority(mostly rich)and seriously, who cares about the rests. :)

Chua Chin Leng aka redbean said...

That's the right attitude. The losers, just tell them to eat in food court if they can afford it, if not hawker centre just as good.

The smart one shall just continue to make all the money they deserved.

Anonymous said...

Without boom and bust, do you think we will have ministers paid in the million$?

Without boom and bust, Ng Teng Fong will just be another ordinary desk boy

Chua Chin Leng aka redbean said...

The unquestioned truth about economic theory of growth is that it all leads to booms and bust. Economic theory of growth is unsustainable in the long run and must end up with a big collapse.

I don't think any economic professor will admit this.

Anonymous said...

Aiyoh Redbean, don't worry about the Government having no where to run or hide when the balloon burst.

Have you not noticed the new tactics being used nowadays by the MIW. On any rainy day they will come out to chant their favourite mantra that goes like this: Heavy rain is expected and some areas may be flooded. Hand washed, not the Government's problem anymore if floods occur.

Now they are starting to chant about the economy going downwards. Don't say they did not warn us will be the answer if it happens.

Anonymous said...

That is it!
Please do not say the Government did not warn You hor!


Anonymous said...

Government like that also got!

And Government like that also paid themselves so much!

No shame shame!

Chua Chin Leng aka redbean said...

I am still against the abolishing of estate duties not because of passing wealth down to the next generation. It is because without this control, rich people will be happy to push property prices even higher. Now $50m is ok, $100m is ok, because not going to be taxe.

Put a lid on it to curb the crazy property prices from hitting the sky.