Tag Archives: Australia

S’pore ranked outside top 5 for real estate prospects

Japan and Australia remain the favourite countries for real estate development and investment, according to the Emerging Trends in Real Estate Asia Pacific 2016 forecast jointly published by the Urban Land Institute (ULI) and PwC.

Tokyo, Sydney, Melbourne and Osaka took four of the top five spots for promising markets in the Asia Pacific. Ho Chi Minh City was rated fifth.

The study, which surveyed 343 real estate professionals, ranked Singapore eleventh for investment prospects and ninth for development out of 22 regional markets.

Specifically, it pointed to a slow residential market here, mainly due to government actions in 2013 to stem soaring home prices.

“Given the current sentiments of Singapore’s property market, we’re seeing local players becoming more involved at a regional and global level as they explore, increase and diversify investments into other major markets such as Japan and Australia,” said Yeow Chee Keong, Real Estate & Hospitality Leader, PwC Singapore.

He added: “The residential market will continue to hope for an increase in the level of transactions, and that will be dependent on whether there will be modifications made to the cooling measures.”

Despite the tepid enthusiasm, the Emerging Trends report noted that “Singapore is always a market where institutions are looking to buy,” adding that a number of major property purchases are expected to be completed before the end of 2015.

Foreign demand for S’pore homes falls to lowest since global financial crisis

The drop in private home sales in Q1 2013 was a result of the tough property cooling measures introduced in January, according to Jones Lang LaSalle.

Resale transactions of condominiums in prime districts 9, 10 and 11 declined 61 percent to 144 units during the period. Notably, foreign buyers registered the lowest level of demand since the global financial crisis. While Singaporeans had previously come to the market’s rescue, they now seem to be stepping away due to downside risks, noted the consultancy.

Supply also fell 29 percent last quarter, based on data from the Building and Construction Authority (BCA).

The latest measures have caused growth in capital values to decline greatly in the luxury prime market and only slightly in the typical prime market. Budget 2013 also mentioned higher taxes on luxury property “that will come into effect in 2014 and 2015, and this might have been priced into the first quarter’s weak capital value growth”.

Moving forward, Jones Lang LaSalle predicts that Singapore’s central bank may introduce stricter rules on the amount of capital banks must hold against residential mortgages. This would in turn “tighten the availability of credit and limit home price growth”.

Local and foreign home buying in the prime market is also expected to decline further following the seventh round of cooling measures and new property tax measures. Consequently, capital values of prime properties would fall by three to five percent in the next 12 months.

Source – PropGuru – 16 May 2013