Irrational Exuberance in the Singapore Property Market

Once upon a time in singapore, $800,000 would buy you a nice 1,200 sq ft condo in a decent location with full condo facilities. If you lived in one of these apartments, you would have been considered a relatively rich person and would have obtained one of the key achievements in the Singapore dream.

Fast forward to the present, however, and things are completely different. Today, the same $800,000 gets you only half the amount of space you would have gotten 10 years ago.

3-bedroom condo unit smaller than a squash court

Wednesday, Mar 21, 2012, Asia0ne

A new condominium in Bukit Batok is one of the smallest 3-bedroom unit to be built in singapore.

Measuring just 635 sq ft, the unit at Natura at Hillview Terrace is smaller than a squash court and slightly bigger than five HDB carpark spaces, reported The Straits Times.

A typical three-bedroom apartment is between 1,000 and 1,500 sq ft, said real estate consultants, and it is unheard of for a mass market project here to have three-bedroom units of such a compact size.

... Another company's projects, Treescape in Telok Kurau, also features micro three-bedders which start from 603 sq ft.

According to The straits Times, all 32 units have been sold since the project was launch, of which 25 units were sold last month at a median price of $1,401 per sq ft.

... Mr Tan Kok Keong from orangeTee's head of research and consultancy used Hong Kong as an example on whether such units will be well-received by the public.

He told The straits Times: "If you use Hong Kong as an example, yes it's liveable, but whether it's the kind of quality of life that people can get used to is something we actually won't know until the project is completed."

"Feng Shui Finance" and the Singapore Property Market

You know that a property bubble is brewing when Feng Shui gurus are getting into the property market. A recent article on propertyguru quotes the comments of a Feng Shui master on the state of the nascent 'shoe box' market in Singapore. According to Feng Shui expert-cum-architect Shang Zong Wei,

"we are now living in Period 8 where high-rise developments with small units and expensive pricing will become the norm. Period 8 refers to the 20 years spanning 2004 to 2023. This is represented by the trigram Gen (艮), a characteristic of Qi (气) normally relating to mountains, children, feet, ankles and so on. Hence, in Period 8, erection of high-rise housings may be anticipated - modern structures manifesting as 'mountains with livable caves', complete with 'mountain-high' prices. The trend of dwelling units becoming smaller and smaller may seem a natural response to market demand, but it can also be just a natural tendency towards 'children scale'. What is really uncanny is the nickname given to such units - 'shoe box', because Gen (艮) also relates to feet and ankles."

Well, I seriously have no idea about Feng Shui, but according to the Skeptic's dictionary, "Feng shui has ... become another New Age "energy" scam with arrays of metaphysical products from paper cutouts of half moons and planets to octagonal mirrors to wooden flutes offered for sale to help you improve your health, maximize your potential, and guarantee fulfillment of some fortune cookie philosophy. " Also, "in countries where belief in feng shui is still very strong, feng shui has become a hodgepodge of superstitions and unverified notions which are passed off in the university curriculum as scientific principles of architecture or city planning."