Property, time to Sell?
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SCMP 5 Oct 2008
"unemployment will rise, particularly in the finance and property sectors".
My heart bleeds.
Worst still to come for HK amid crisis'Financial tsunami' bigger than '97, banker saysMaria Chan, Cheung Chi-fai and Agencies in Washington and Paris
Oct 05, 2008
| 
Despite the passage of the US government's US$700 billion bank bailout, Hong Kong must brace for belt-tightening amid the global "financial tsunami", the city's labour chief and a top banker said yesterday.
HSBC (SEHK: 0005, announcements, news) Asia-Pacific executive director Peter Wong Tung-shun warned the impact of the crisis would be "far more severe" than that of the 1997-98 East Asian financial crisis.
"This will affect Hong Kong and the whole world," he said. The effects would be felt for another 12 months and recovery would take "much longer" than a decade ago.
So far investors - including buyers of minibonds backed by bankrupt US bank Lehman Brothers, who scuffled with bank security staff yesterday - have been the biggest losers locally from the crisis. But both men warned its impact would grow.
Mr Wong expected Hong Kong businesses would have to control costs, but said mass layoffs were unlikely. Matthew Cheung Kin-chung, the secretary for labour and welfare, forecast jobs would go, however.
He said: "The financial tsunami will have a far-reaching impact. Enterprises may need to make manpower changes and there is a chance unemployment will rise, particularly in the finance and property sectors. Consumption will likely be hit too." .................................................
.................... Associated Press, Reuters, Agence France-Presse
Oct 05, 2008
| Despite the passage of the US government's US$700 billion bank bailout, Hong Kong must brace for belt-tightening amid the global "financial tsunami", the city's labour chief and a top banker said yesterday.
HSBC (SEHK: 0005, announcements, news) Asia-Pacific executive director Peter Wong Tung-shun warned the impact of the crisis would be "far more severe" than that of the 1997-98 East Asian financial crisis.
"This will affect Hong Kong and the whole world," he said. The effects would be felt for another 12 months and recovery would take "much longer" than a decade ago.
So far investors - including buyers of minibonds backed by bankrupt US bank Lehman Brothers, who scuffled with bank security staff yesterday - have been the biggest losers locally from the crisis. But both men warned its impact would grow.
Mr Wong expected Hong Kong businesses would have to control costs, but said mass layoffs were unlikely. Matthew Cheung Kin-chung, the secretary for labour and welfare, forecast jobs would go, however.
He said: "The financial tsunami will have a far-reaching impact. Enterprises may need to make manpower changes and there is a chance unemployment will rise, particularly in the finance and property sectors. Consumption will likely be hit too." .................................................
.................... Associated Press, Reuters, Agence France-Presse
My heart bleeds.
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I'm painfully waiting to buy in again and everytime I call about an offer the owner has dropped it another half a million to below what I wanted to offer him for it. What I wanted to know is if anyone has had to stump up for a bigger deposit ie have mortgages stayed at 95% as the money market tightens?
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Hang Seng down 3% this morning. Better wake up to the fact that this party is about to be well and truly over. I think 97 will seem like a tea party when this shake out is done. The cascade of selling and collapsing prices is only weeks away. Those of you who doubt that......well, the same assurances were uttered in 97....for a few weeks anyway. Get out now if you want to see any profit left. 
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Frogman, Apple, what a pack of Drama Queens you are....peeing on yourself with the prospect of frightening people.
Its not what you guys say, as an opinion is an opinion and in these uncertain times all are valid but its that gleeful tone of doom when people need support instead of fear .
Again to those wondering what to do, my advice would be ONLY seek advice from people you would consider to have a lifestyle you admire, not those "balanced types" with chips on both shoulders who have never invested or taken a risk with anything so love to see markets crash on those who they envy. Hold steady and respond thoughtfully and don't despair.
Also remember PPRUNE is where the worst Jungian "shadow" of the pilot body lurk. Full of Anon windbags who spew their venom. Unfortunately its also where the younger or vulnerable people come looking for advice and their vulnerability and often sincere questions are treated as a feeding frenzy for the underbelly of the industry.
Its not what you guys say, as an opinion is an opinion and in these uncertain times all are valid but its that gleeful tone of doom when people need support instead of fear .
Again to those wondering what to do, my advice would be ONLY seek advice from people you would consider to have a lifestyle you admire, not those "balanced types" with chips on both shoulders who have never invested or taken a risk with anything so love to see markets crash on those who they envy. Hold steady and respond thoughtfully and don't despair.
Also remember PPRUNE is where the worst Jungian "shadow" of the pilot body lurk. Full of Anon windbags who spew their venom. Unfortunately its also where the younger or vulnerable people come looking for advice and their vulnerability and often sincere questions are treated as a feeding frenzy for the underbelly of the industry.
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sure Volare...(real corinthian leather!). Perhaps you would like to turn on your television. If you have a modicum of economics training, you will see that the world is at the precipice of the most major economic meltdown in history. I will remind you that 97 was mainly caused by the collapse of one currency (Thai Bhat). This situation is far in excess of the 97 problem. Think what you like. Big trouble is coming. Having said that...I hope i'm wrong. 
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Ive been checking some valuations on HSBC. Although valuations are ~7% less than 6 months ago, this seems quite optimistic by HKs largest lender. Do they want to create more toxic debt by overvalueing Mid Levels units?
Will owners now be offering flats at "20%" below valuation", as was the case 5 years ago?
HK property is still secure (!),and has so far lost much less than my HK stocks and MPF (down 60K this year)
Most guys have doubled their investment in the last 3 years. A fall of 20% shouldnt worry most, we will just buy more
Will owners now be offering flats at "20%" below valuation", as was the case 5 years ago?
HK property is still secure (!),and has so far lost much less than my HK stocks and MPF (down 60K this year)
Most guys have doubled their investment in the last 3 years. A fall of 20% shouldnt worry most, we will just buy more
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Sorry VC.
When it suits you, you like to talk the market up. At the moment it suits me to talk it down.
Here's another good bit of news for you.
SCMP 6/10/08
"Cathay Pacific (SEHK: 0293) slid 7.2 per cent to its lowest in more than 5 years as analysts forecast waning demand for air travel from its premium customers."
When it suits you, you like to talk the market up. At the moment it suits me to talk it down.
Here's another good bit of news for you.
SCMP 6/10/08
"Cathay Pacific (SEHK: 0293) slid 7.2 per cent to its lowest in more than 5 years as analysts forecast waning demand for air travel from its premium customers."
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I agree with Apple. We are witnessing a once in a life time economic melt down.
If you have a mortgage which is based on the LIBOR, you are about to get a 70% increase in your interest rate. The HKD LIBOR rate has gone from 3.5% to 5.5% and climbing. That will put huge pressure on repayments and cash flow for other things that you might spend your money on.
Volare call me a drama queen if you like , I can tell you that 1997 was small with regards to this one...I really hope that I'm just a drama queen, but for the first time I scared, as everything up to now I could reason and work around , this time not even economic common sense is helping.
The only reason that the property has not gone down as much is because the market has gone down so quickly that the housing sector is laging way behind.
If you have a mortgage which is based on the LIBOR, you are about to get a 70% increase in your interest rate. The HKD LIBOR rate has gone from 3.5% to 5.5% and climbing. That will put huge pressure on repayments and cash flow for other things that you might spend your money on.
Volare call me a drama queen if you like , I can tell you that 1997 was small with regards to this one...I really hope that I'm just a drama queen, but for the first time I scared, as everything up to now I could reason and work around , this time not even economic common sense is helping.
The only reason that the property has not gone down as much is because the market has gone down so quickly that the housing sector is laging way behind.
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Frogman, I don't think you get my point. I understand completely the fear that is around the domino effect of this will touch everyone. I am not in denial regarding the current massive global economic adjustment, but rather the massive panic and fear that goes along with these uncertain times which actually only serves to contribute to the losses and does not help anyon. Also I am sick of those who sit by awaiting crises to justify their own lack of "investment" in life. It was the same during Sars Tsunami Y2K and on and on. I also hate to see the younger lads and lasses ask genuine questions both here and in the cockpit only to be scared out of their bejeezus by whingers not only on this issue but on many issues. That approach is unhelpful. Are we trained in emergencies to shout..."were goin down were goin down?" A little of the qualities our profession should exhibit in our jobs in should be evident outside of the cockpit as well as inside. It would be nice to see some of that.
The fact is for the past 10 years or so we have fooled ourselves into thinking we have control over our lives and security. Fact is THE ONLY THING WE HAVE CONTROL OVER IS OUR REACTIONS/RESPONCE.
Appletree I have never driven a Chrysler in my life and misquoting Montalbán does not make your attitude smell sweeter!
The fact is for the past 10 years or so we have fooled ourselves into thinking we have control over our lives and security. Fact is THE ONLY THING WE HAVE CONTROL OVER IS OUR REACTIONS/RESPONCE.
Appletree I have never driven a Chrysler in my life and misquoting Montalbán does not make your attitude smell sweeter!
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Don't panic
Most HIBOR mortgages have a prime minus cap so you shouldn't be caught out too badly.
Also, governments around the world are trying hard to alleviate the effects of the credit crisis which means they'll probably be less concerned about inflation than they are about the general state of the economy, so we'll probably see plunging interest rates over the next few months.
I agree that we're in or heading towards a significant downturn but I can also remember people like NR saying in an update 3 months after SARS that at one stage he thought the company might go under and during the Asian Financial Crisis people saying that it would bring the rest of the world with it, so I think it's a bit far fetched to suggest that the end of the world is nigh!
If you're looking at a 1-2 year timeline this might not be the best time to buy, but I think that sometime over the next 10 years you'll see the price paid today reappear, be it 2011, 2013 or 2018.
Also, governments around the world are trying hard to alleviate the effects of the credit crisis which means they'll probably be less concerned about inflation than they are about the general state of the economy, so we'll probably see plunging interest rates over the next few months.
I agree that we're in or heading towards a significant downturn but I can also remember people like NR saying in an update 3 months after SARS that at one stage he thought the company might go under and during the Asian Financial Crisis people saying that it would bring the rest of the world with it, so I think it's a bit far fetched to suggest that the end of the world is nigh!
If you're looking at a 1-2 year timeline this might not be the best time to buy, but I think that sometime over the next 10 years you'll see the price paid today reappear, be it 2011, 2013 or 2018.
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Yes you are right , the HIBOR is steady. The LIBOR which the HKG banks that are financing your home in OZ is worked on, has shot up.
The dropping interest rates are true but you will see that the banks will not be passing the cut on to us as they are hording cash. Australia is one example. HSBC has also currently increased the interest by 50% on all new mortgages.
The one positive of holding on to a HKD property is that the rising USD is basically pushing the value in AUD, EUR and GBP upwards.
As it now stands you can drop the valuation of your house by 26% and you will still pull out the same AUD value that you had in AUG 08...then again the USD long term view is in the garbage!!!
The dropping interest rates are true but you will see that the banks will not be passing the cut on to us as they are hording cash. Australia is one example. HSBC has also currently increased the interest by 50% on all new mortgages.
The one positive of holding on to a HKD property is that the rising USD is basically pushing the value in AUD, EUR and GBP upwards.
As it now stands you can drop the valuation of your house by 26% and you will still pull out the same AUD value that you had in AUG 08...then again the USD long term view is in the garbage!!!
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Cafe, you have a right to do as you wish but if you reread what I said I am not talking the market up or down, rather my issue is with the gloat and scaremonger attitude of some of our colleagues to genuine concerns raised.
However there are as you can see below some more thoughtful and sincere discussion possible which is much more helpful, thats all.
However there are as you can see below some more thoughtful and sincere discussion possible which is much more helpful, thats all.
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Hang Seng down over 600 points this morning, not to mention carnage in all the other major markets. Bank failures, record deficits, recession. What part of the previous formula makes anyone of you think that property prices will stay at present levels...?
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HSI down 1400 now!
The primary reason the prices will remain firm is that there is nothing else for the chinese to do with their money.
Gweilos are just along for the ride. Period.
The primary reason the prices will remain firm is that there is nothing else for the chinese to do with their money.
Gweilos are just along for the ride. Period.
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Remember 1929 – what seemed to be the end was only the beginning - Telegraph
Anyone know any financial genius that has been buying his company's shares back recently......?
Anyone know any financial genius that has been buying his company's shares back recently......?