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Singapore property prices are set to jump 10 per cent by the end of next year, according to United States banking giant Morgan Stanley.
The bank's in-house experts expect private home prices to start rising next month - instead of early next year as it stated in a previous forecast. The forecast does not relate to Housing Board flats.
The significant upswing in prices would reverse a four-year downcycle after a range of cooling measures was introduced to slow the market.
Two condo units in prime District 10 were offloaded at losses of more than a million dollars each in the week of Oct 25 to Nov 1. The bigger loss of $1.8 million came from a 3,671 sq ft penthouse at Orange Grove Residences off Stevens Road. The fifth-floor unit fetched $6.1 million, or $1,662 psf, on Oct 27, 22% below the purchase price of $2,143 psf paid to the developer in February 2007. The seller incurred an annualised loss of 3% after having held the property for close to 10 years.
A lack of investor confidence following Black Monday will have a lasting impact on the growth potential of the Singaporean property market.
Summary:
THE Singapore government could potentially review its property cooling measures towards the end of this year, said UOB in a research note on Friday.
UOB said that a relaxation in seller's stamp duty (SSD) and selected reductions in additional buyer's stamp duty (ABSD) rates for Singaporeans may be likely, given the bank's expectation of a 5 to 10 per cent correction in housing prices this year.
Recently, there were reports on units in high-end condominium projects being sold at a big loss. As property buyers, we often hear from developers and property agents that property prices will always go up in the long run.
Does the property market always manage to recover, with prices going higher than the previous peak? Is it true that any time is a good time to buy? Below is an abstract from my book No B.S. Guide to Property Investment about one of my real-life property stories and the lessons learned.
WHEN it comes to the best and worst property markets in Asia, Singapore has it covered. Office rents in the city’s central business district jumped 14% last year, the biggest increase in the region, while luxury home prices slumped 6%, the most in Asia, according to property broker and consulting company Jones Lang LaSalle.
The gap is about to widen. Prime office rents in the city, Asia’s most expensive after Hong Kong and Beijing, are projected to extend the gain a further 5% this year with a limited supply, said Chua Yang Liang, Jones Lang LaSalle’s head of research for Singapore and Southeast Asia.
Private condominium sellers are taking nearly six months to secure a sale, the longest wait in over two years, new data shows.
It also takes far longer now to find a buyer for a Housing Board flat - with a three-month wait on average.
Private property market prices in Singapore may be levelling off at a new support level after five years of cooling measures that have been very effective at stalling the market.
However, it appears the effectiveness of the measures has levelled off. Barring major catastrophes such as war, epidemics or financial crises, private property prices are expected to hold up, unless more resale supply is introduced or the Government removes the cooling measures.
The current property cycle bears the following similarities with the 1986-1998 cycle:
1) At the cycle peak, landed properties outperformed non-landed properties and detached houses are the best performer while condominiums are the worst performer.
2) In both property cycles, unlike in the other cycles, prices reached a peak and started to decline in response to property cooling measures introduced by the Government and not due to some external events such as an economic crisis.
I thought it would be interesting to compare and contrast the two property cycles to see what are the similarities and differences and what insights we can draw from them.
The Singapore property market has undergone four property cycles since 1975. The first cycle from 1975-1986, the second from 1986-1998, the third from 1999-2004 and the fourth from 2004-2009. We are now into the fifth cycle which began in 2009.
SINGAPORE - Resale prices of non-landed private homes crept up by 0.4 per cent last month, compared with the previous month, latest data from the Singapore Real Estate Exchange (SRX) showed.
The month-on-month increase came about as non-landed private home sales in the core central region and rest of central region rose by 4.8 per cent and 1.5 per cent respectively, the SRX said on Monday.
But compared with the same period a year ago, the price index dropped 5 per cent.
SRX also said prices have fallen 5.3 per cent since the recent peak in January this year.
What does the future hold for Singapore’s property market?
According to a recent Savills report, the outlook remains challenging for the rest of 2014, and this is expected to continue over the next six years.
The report looked at how 12 world cities would perform in 2020 and gave a tough assessment of Singapore.
Apart from location, the next most important question on a home buyer’s mind is probably the tenure of the property.
There are generally two types of tenure in Singapore: Ninety-nine-year leasehold and freehold. For all practical purposes, the 999-year leasehold property is considered to be the same as freehold because the difference in their values is negligible and banks will not impose any loan limits.
Based on the latest URA private property price index (PPPI) flash estimates, we know that the PPPI, which represents the overall real estate price trend, has dipped in 2013Q4. This is the first dip the market has seen in the last 2 years.
At present, there are numerous views that the real estate market will stay stagnant for some time. I agree and here are 4 reasons why we think 2014, and maybe even 2015, could be a turbulent year for stakeholders of the Singapore property market.
In Jan 2014, I wrote about why this year could be turbulent for property market stakeholders. In the recent weeks, there were some reports on how quiet the high-end property market in Singapore is. A casual observer may think that this is just limited to the high-end sector; in reality, the market malaise is probably more wide spread than what many people realise.
For those who are wondering just how bad the market is, here are 3 indicators to shed some light on the health of the Singapore residential property sector.
June's headline 73 percent plunge in Singapore's new home sales may look worrying, but some analysts are pointing the blame at the World Cup.
"We didn't see many launches by developers, mainly because of the June school holidays and also there has been an impact from the World Cup on the property market," said Donald Han, managing director at property consultant Chestertons. "Even in the stock market, there was a softer period in terms of trading activity."
Prime residential property prices in Singapore saw the sharpest decline over the past year out of the 32 cities profiled in Knight Frank's latest Prime global Cities Index.
Prices fell 7.7 percent in the 12 months to June 14, the index showed, with much of the declines taking place recently as Singapore prices fell 6.4 percent in the three months to June 14.
RESALE prices and rents for private homes both tumbled to fresh lows last month as the property market slowdown deepened.
The declines underscore a downward trend that has been evident in the residential market since tougher cooling measures and home loan restrictions were rolled out last year, and consultants believe the gloom is unlikely to lift any time soon.
INITIAL reports of the property market's demise appear to have been slightly exaggerated.
After policymakers imposed strict curbs on consumer loans last June under total debt servicing ratio (TDSR) rules, analysts predicted that private home prices would plunge by up to 10 per cent this year.
Some warned that home sales could grind to a near halt, quipping that TDSR actually stood for "total destruction of Singapore real estate".
So far, however, the slowdown in prices has been far milder than expected.
Singapore's property market has entered a standoff between bargain-seeking buyers and developers sticking to their pricing guns, with March's new home sales dropping 83 percent from a year earlier.
"Buyers think they can have their cake and eat it," said Alan Cheong, senior director for Singapore at Savills Research. "They are expecting the other side to lose money on their behalf. That idea doesn't work if you have an economy that's fully functioning," he said, citing the city-state's unemployment rate of only 1.5 percent.
Singapore said Friday that measures it had implemented to cool down the property market have succeeded but it was "too early" to relax them.
