appy New Year And Welcome To 2010!
Qotion will like to take the opportunity to thank all its readers and members for your support this year. It's been a trying year for all of us, but we're glad to receive a brand new year with great cheer!
Last week we asked you if you think you have achieved your financial goals for 2009. 50% of our respondents think that you have not done so. Take heart! It's the end of 2009 and the new year is almost upon us. As you make your new year resolutions for 2010, don't forget to set your financial goals for the upcoming year.
With that in mind, Qotion has researched 3 trends related to personal finance that we forsee may happen in 2010.
1. Property market
The
rebound in private property market this year took pretty much everyone by surprise, and in spite of the recession, prices grew so fast that there was talk of an
impending property bubble, which prompted the government to
freeze easy credit schemes and
increase supply of public housing.
What may happen in 2010?
According to a
recent report by DTZ research,
residential property sales accounted for
50% of total transactions while the
retail sector was the next highest. The report also predicted a
more active year ahead due to
increased market sentiment. This sentiment is echoed by other market watchers. Eugene Lim, associate director of ERA Asia Pacific, quoted that housing prices look set to rise in 2010 due to
market recovery and the opening of the
integrated resorts.
2. Stock Market
The stock market took a pretty severe beating which bottomed out at a 6-year low of 1,533.40 by March 2009, but has been generally on an uptrend in the 2nd half of the year. Currently it hovers around 2,869.30, almost double that of March, a high not seen since September 2008.
What may happen in 2010?
Singapore's economy suffered from a
dearth of demand for exports in 2009, which hurt its manufacturing sector. According to a recent HSBC report, Singapore's performance in 2010 will likely
exceed expectations, with an economic expansion of 6.5% as compared to the 3 to 5% predicted by the government. With Asia's domestic demand recovering and electronics output increasing by 40% from March to December, there is
reason to be optimistic about the overall market recovery. With the economy improving and increased demand, market sentiment should also improve, and funds tracking this improvement, particularly
REITs and the
STI Exchange Traded Fund (ETF), look to be a good buy.
3. Interest Rates
With the onset of the financial crisis, the US Federal Reserve took the drastic step of slashing interest rates to near zero. The Singapore Interbank Offered Rate (SIBOR) is pegged to the Fed rate. As a result, the 3-month SIBOR rate, the rate at which banks borrow from one another, has hovered around 0.68 from June to now, not far from the all-time low of 0.56% in 2003. The SIBOR rate is also frequently pegged to mortgage interest rates, so an increase will mean higher home financing costs.
What may happen in 2010?
Unemployment in the US has fallen to
10% last month, a sign that a recovery is on track. According to a recent survey of US economists by Reuters, most of them expect the Fed to
raise the interest rates by the end of the first quarter. Analysts in local banks project that the SIBOR rate will
rise in accordance with this hike by the
2nd half of the year. What this means is that if you are looking for a mortgage, now's probably the best time to get it.
So after reading our predictions of trends for 2010, do you think the next year will be a better one?
Wishing You A Happy New Year and a great weekend ahead!
