As you know, I have worked in property for a few years and so I’ve seen my share of ups and downs.
But I tell you the truth, although it is natural that property prices will gradually go up over the years, you will notice that between 2007 and 2013, prices have increased extraordinarily. This is not natural at all.
The fact is that under PAP Minister Mah Bow Tan, HDB prices went up so high, almost 400% higher than before! Coupled with pressures from inflation and large scale property development in Singapore, the average Singaporean now has to take 30+ years to pay off his loans for his house.
Gone are the days when Mr Lee Kuan Yew said every Singaporean should own his or her own home. Today, Singaporeans are effectively living in rented flats, paying out of their noses for a property that they hope will finally belong to them.
Now the prices are dropping, but to what extent? A slight dip in the short term will not “make up” for the sudden upsurge in prices since 2007. If we are extremely generous and say that the price drops at a constant rate for the next few years, it would take 7 quarters before prices go back down to pre-2007 levels. Yet that is no longer an option, because our young couples now have signed leases from HDB to pay for super expensive flats and even if the value falls, the loans that they have to pay will still remain the same.