Talking on the Chinese language station 95.8FM radio call-in , even the prime minister admitted that there are retirees who are asset-rich cash-poor. "We should take a close look at this problem.... ", he said, without venturing any solution.
The Reuters report of another quiet group highlighted the eerie silence at night in Sentosa Cove, the only place in Singapore where foreigners can buy landed property. Spurred on by the 2004 Financial Investor Scheme (FIS) that allowed foreigners with a global net worth of $20 million to become permanent residents (PRs) if they parked $5 million (raised to $10 million in 2010) in country, $2 million of which could be put into property, the gold rush was on.
Fast forward to July 2014, a four-bedroom apartment in Sentosa's Turquoise condominium went under the hammer at a mortgagee sale for $1,400 per square foot. In 2012, a similar flat in the same block went for $2,450 per square foot and in 2007, it fetched $2,800. "The rental can't even cover the mortgage for these high-end investments - they want to offload but there are no takers," said the head of research at property consultancy OrangeTee.
No pity for this lot. Without a doubt, they helped pushed the COE to untenable levels. Last month United Overseas Bank (UOB) reported a doubling in its bad debt charges for the second quarter, attributing to a group of investors struggling to service high-end property loans. Inevitably, the banks will have to hike interest rates, and even those flat buyers who opt for the Housing Board's fixed concessionary loans may not escape the bloodbath ahead. Be afraid, be very afraid.