5 things you must know about Singapore property in 2019

The property market went for a rollercoaster ride last year. What impact did last year’s cooling measures have and how should we prep for this year?

Here are the key issues to look out for in 2019:

· Home loan rates will continue to climb

· District 19 is hot property

· En blocs are unlikely to happen this year

· Tenants have an upper hand despite slight rental market recovery

· Global tensions may affect property market

1. HOME LOAN RATES WILL CONTINUE TO CLIMB

Home loan interest rates climbed from 1.65 per cent to 1.95 per cent per annum, following the US Federal Reserve upping its rates. The Fed projected two more interest hikes which means home loans will continue to climb.

2. DISTRICT 19 IS HOT PROPERTY

District 19 covers the areas of Punggol, Sengkang, and Serangoon Gardens. Over the past six months, there has been a significant upswing in residential prices across the district, with the average per-square-foot increasing nearly 80 per cent.

The reason for this sharp upturn is largely due to new condominium launches last year. What is unusual about the situation is that prices are going up despite rising supply.

3. EN BLOCS ARE UNLIKELY TO HAPPEN THIS YEAR

The newly implemented cooling measures have made en bloc sales more difficult to push through. Developers now have to contend with higher fees such as development hikes and additional buyer’s stamp duty, making it more expensive to start new projects.

As of December 2018, no less than 30 en-bloc sales have failed to find buyers. Of which, half have lowered the asking price.

Should there be any en blocs at all this year, they will likely be for smaller plots of land that developers are confident to develop.

4. TENANTS HAVE AN UPPER HAND DESPITE SLIGHT RENTAL MARKET RECOVERY

Rental rates may have gone up over the past year, 20.7 per cent to be exact, but that does not mean that landlords are out of the woods.

According to government statistics, 45,000 new units will be made available over 2019 and 2020. Therefore, it is still very much a tenant’s market despite the slight upturn in rental rates.

5. GLOBAL TENSIONS MAY AFFECT PROPERTY MARKET

There is an indirect connection between global trade tensions and our property market.

Two things to watch for:

First, given the global trade situation, there is a possibility of companies doing away with expatriates. This will inevitably reduce the number of prospective tenants in Singapore. Districts 9 and 10 will be the hardest hit as rental in those districts are mostly made up of expatriates.

Second, investors are likely to turn cautious in the current climate of geopolitical confusion. Both foreign and local investors may sit out the year rather than invest in local properties.

Source: 99.co

PROPERTY LAUNCHES & INVESTMENTS

Property Launches & Investments

5 things you must know about Singapore property in 2019

Comments

Leave your comment