What it looks like after a property bubble burst


ricohflex

Senior Member
Feb 24, 2005
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#1
This is what it looks like after the speculative bubble burst - in this case in Spain, but could theoretically apply to any country.

1,200,000 unsold new homes in Spain.

Just some of the many ghost towns with completed or half completed blocks of buildings but zero/few residents.

Valdeluz
Yebes
Sesena

Won't happen in Singapore, but just for a sense of scale of the problem in Spain, imagine all of Toa Payoh, Ang Mo Kio, etc.....with buildings nearly 100% empty with zero/few residents.


Spain's most famous ghost town

Spain haunted by ghost towns built during boom years as unemployment tops 5million | Mail Online

The ghost towns of Spain: Images that are desolate symbols of collapsed property market - Telegraph

Valdeluz - Valdeluz, il quartiere fantasma di Madrid - Fotostory di viaggi - Zingarate









 

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Shizuma

Senior Member
Mar 19, 2012
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#2
some vignetting seen . hee. :bsmilie:

anyway the good news is Singapore is simply too crowded to have ghost town. even cemetery like Bishan also had to be excavated.

the worrying thing is that the property situation in Mainland China is similar . many residential properties empty . no party ( political or otherwise ) goes on for ever
 

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#3
anyway the good news is Singapore is simply too crowded to have ghost town. even cemetery like Bishan also had to be excavated.
We are fortunate that Singapore is surrounded by sea. We can build wooden rafts or house boats to live on the surrounding sea.

After Marina Bay Sands and Resorts World Sentosa, welcome to Sampan City:

 

ricohflex

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#4
the worrying thing is that the property situation in Mainland China is similar . many residential properties empty . no party ( political or otherwise ) goes on for ever



If the PRC ordinary joes borrowed heavily from bank to buy Hainan property at these unreal inflated prices at the peak of the bubble, they are in trouble when the bubble bursts and prices crash down steeply in a freefall. Have to top up huge bank loans and with no buyer to off-load the burden for the next 10 years. Probably the same thing happened to the Spanish speculators.

Watched a TV documentary on Hainan island which was marketed as China's Hawaii and lots of PRC property speculators got conned into buying at very high prices, properties which are now completely unoccupied as empty shell blocks in ghost towns.

"About 80 percent of the new residential buildings in cities such as Haikou and Sanya are vacant, according to my research on the property market in Haikou and Sanya," said Wang, who is also an economics professor from Hainan University.

http://www.chinadaily.com.cn/china/2012-02/13/content_14587197.htm
 

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Shizuma

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Mar 19, 2012
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#5
If the PRC ordinary joes borrowed heavily from bank to buy Hainan property at these unreal inflated prices at the peak of the bubble, they are in trouble when the bubble bursts and prices crash down steeply in a freefall.
LTV clause trigger loan call?
 

ahboy168

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#6
U think here is safe? When the ultra rich decide to park their money elsewhere, we are gone.
If no job, door open big big also no one come here. Then property cannot rent out, there goes all busts..
 

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Shizuma

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#7
U think here is safe? When the ultra rich decide to park their money elsewhere, we are gone.
If no job, door open big big also no one come here. Then property cannot rent out, there goes all busts..
there will always be property which can be rented out in Singapore . it is just a matter of price , whether it will be acceptable to the landlord . . .

don't be disheartened
 

donut88

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Nov 14, 2008
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#8
ahboy168 said:
U think here is safe? When the ultra rich decide to park their money elsewhere, we are gone.
If no job, door open big big also no one come here. Then property cannot rent out, there goes all busts..
Don't be naive.....
 

Big Kahuna

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Dec 15, 2004
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#9
Strong Sing dollar.....stable politics....safe.....low income tax.....passport that could travel everywhere without visa.....if u are ultra rich.....u would want to park ur money in sg....not elsewhere :)
 

#10
......Won't happen in Singapore, but just for a sense of scale of the problem in Spain, imagine all of Toa Payoh, Ang Mo Kio, etc.....with buildings nearly 100% empty with zero/few residents.

If it happens in Singapore you'll find people lining up with sacks of cold hard cash to buy 2 or 3 apartments each. :bsmilie:
 

ArchRival

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Sep 17, 2006
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#11
Property can be long-term business. In sg now people pay off their houses in a decade. Imagine taking a $400k loan to buy a house with the aim of renting out/selling when price goes up. Then the bubble burst. You will be paying $400k for a house now worth $200k+.

Bottom line is, you can't even find someone to rent your property to, at least not enough to cover the massive installments you are paying. Debt mounts and pretty soon lots of people will be offloading their property cheap, or giving them to the bank.

Worse still, i can see this happening because in my opinion the way the govt does certain things is not sustainable. I think there is a good chance the property burst will happen because of a failure in other sectors of the economy. The foreigners/foreign investors will pull out. And last i heard, foreigners is roughly 50% of the people here, imagine the drop in demand. Even if you bought a $400k house to live in and not for selling/renting out, you will be servicing massive loans in an adverse economic environment.
 

ahboy168

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#12
Those who think property price here only goes up is naive.
 

donut88

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Nov 14, 2008
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#13
ahboy168 said:
Those who think property price here only goes up is naive.
Explain why u think SG property prices may go down?
 

Jedi

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Jul 17, 2002
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#14
There are always 2 sides of camps. One side is praying for bubble to burst so that they can buy at lelong prices while the other group is hoping for prices to continue to escalate. Therefore, the question is which side are you?

I have seen many people made hundreds of thousand or even millions in properties in Singapore but on the other hand, some got burnt. There is no such thing as one-sided affair.

For those who think that Singapore properties will crash like in Europe or US, think again. Prices may drop or grow at a slower pace but definitely will not be a crash. Just remember who is incharge of Singapore and whether our dear "" will allow that to happen. Relook at our government policies on housing (past and present) if you have not done so; you can see what's happening and the directions going forward. Technically, Singapore property market is controlled by "invisible hands" - who are the biggest landlords in Singapore :bsmilie:
 

albertri

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Jun 6, 2010
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#15
This is unlikely to happen in SG 1st they dont build like crazy here coz not enough land and Govt control the sale of land.... property bubble burst only if most non Singaporean start to leave and start selling thier houses then we will see some "not a lot but some" flooding this will lead to property prize to drop but not all the way to the floor. But how likely this will happen? maybe if the Govt asked all non Singapore to leave the country then it may happen I think even opposition will win they cant ask them to go they may close the door but may keep those already inside :)

I am not a property expert nor knew much about it just by looking how things are manage here you'll see how it goes. When was we had a property price slid a lot I think it was in 1998 and 9-11. After that even with US and Europe economy woes Singapore property still ok.
 

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edutilos-

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Dec 28, 2010
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#16
U think here is safe? When the ultra rich decide to park their money elsewhere, we are gone.
If no job, door open big big also no one come here. Then property cannot rent out, there goes all busts..
Apologies, I am having a little trouble with your logic. Are the 4 sentences linked together? Because you seem to suggest that the ultra-rich are coming to Singapore for jobs. But I admit, that just seems to be a deduction on my part.
 

ahboy168

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Mar 30, 2009
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#17
No foreign investment = no jobs here.
No job here = FT goes back home.
FT goes home = SG landlord no tenant
No tenant = bank ask u force sell or top up
Force sell = loss $
Loss $ + lose job = bedok reservoir ??
 

keiser

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Dec 13, 2011
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#18
Stepping back a little ... does the rent seeking cum asset inflation model really help the economy? ... what do you think?
 

ahboy168

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#19
I am just an average man in street ...
Who care if it help economy or not, it must help my pocket !
GDP don't help me. My pay still same, but expense all goes up including property tax.
 

keiser

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Dec 13, 2011
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#20
Urm ... but isn't your "equations" on FT describing part of the sg economy :) ... in any case, i guess you didn't like rising housing prices right? Well, so do I. But who do think benefit from this and why does it continue for so long?

I am just an average man in street ...
Who care if it help economy or not, it must help my pocket !
GDP don't help me. My pay still same, but expense all goes up including property tax.
 

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