Ravi Chandran
Property market sentiments in Singapore remain upbeat despite sales of new homes dropping in February 2018. The data for February home sales showed that sales of new homes fell by 28 per cent from the sales in January 2018. But this lower numbers is not indicative of a slump of the property market’s recovery. Analysts attributed the drop to the traditional Chinese New Year lull, with the festivities taking place in February this year.
February only saw 2 new launches – Parksuites and Nim Collection. 186 units were launched in total in February, while 377 private homes were sold. But the numbers from January tell a different story. A total of 524 units were sold in the first month of the year. This is comparable to the 2017 figures, where 108 units were launched and 382 units sold.
Another sign showing that the property market sentiments are upbeat is the increasing rental prices. Private non-landed home rents rose by 1 per cent in February 2018 from a month ago, higher than the 0.5 per cent rise in January.
When compared to a year ago, rental prices are 0.7 per cent lower, and 18.8 per cent lower than January 2013’s peak rental price. But the overall positive property market sentiments has continued well into 2018, with 3,376 units being tenanted last month.
These positive property market sentiments are also reflected in the largest collective sale in more than 10 years with the sale of Pacific Mansion for S$980 million. This sale marked the largest sale since Farrer Court was divested at $1.34 billion in 2007.
https://www.icompareloan.com/resources/commercial-spaces-rental-continued-signs-recovery/
The upbeat sentiment was also mirrored in the Urban Redevelopment Authority’s property price index (PPI) of private residential properties. The PPI which is an index that tracks the prices of private homes, reached a turning point in the third quarter of 2017 – this after 15 straight quarters of decline.
Property giants are also optimistic about the residential property market. City Developments for example, painted a rosy picture of the property market here in its 2017 fourth quarter earnings report.
“Urban Redevelopment Authority (URA) data indicated that private residential property prices increased by 1.1% compared with the 3.1% decline in 2016. Notably, after 15 consecutive quarters of decline from Q3 2013 to Q2 2017, prices started to inch up in the last two quarters of 2017, signalling that prices may have bottomed.
With property prices rebounding after a four-year bear market coupled with increased sales volume, the boost in market sentiment points to a likely recovery of the residential market. The improved market sentiment has resulted in a positive spill over to the EC market and a revival of the collective sales market. Residential collective sales hit a record high of $7.64 billion as at December 2017.”
Capitaland was similarly optimistic of the sentiments in the property market. In its 2017 fourth quarter report, CapitaLand said that it “expects residential property market sentiment to remain positive, underpinned by increased transaction volumes and a recovery in home prices.”
Frasers Property too pointing to a “market recovery” in its first quarter report for its fiscal year 2018:
“Transaction volumes improved for the Singapore private residential property market in 2017 with about 10,600 new private homes sold, which is about 33% more than the 8,000 units sold in 2016. The private residential property price index grew 0.8% in the December 2017 quarter, similar to the 0.7% growth in September 2017 quarter.
For the whole of 2017, prices increased by 1.1%, compared to the 3.1% decline in 20163. The increase in private home prices was driven by higher sales volumes, indicating a market recovery. Some industry experts expect private home prices to rise on the back of higher land prices transacted.”
Even the the recent hike to the top marginal rate for buyer’s stamp duty (BSD) is not expected to dent the market optimism. Augustine Tan, president of the Real Estate Developers’ Association of Singapore (Redas), said the new revised BSD “may add some friction to transaction volumes as buyers remain price-sensitive (but) it is unlikely to derail the recovery (of the property market).”
https://www.icompareloan.com/resources/foreign-property-buyers-demand-jump/
