Tag Archives: National University of Singapore

Singapore developers more pessimistic

Business sentiment among property developers in Singapore fell further in Q4 2015, reported The Business Times, citing a survey by the Real Estate Developers’ Association of Singapore (Redas) and the National University of Singapore (NUS).

The Current Sentiment Index, which monitors changes in sentiment during the last six months, dipped to 3.6 in Q4 from 3.7 in the previous quarter.

On the other hand, the Future Sentiment Index, which monitors sentiment in the next six months, dropped to 3.4 in Q4 from 3.7 in the quarter before.

As a result, the Composite Sentiment Index slid to 3.5 from 3.7 previously. A score of less than five indicates deteriorating market conditions while a score of more than five implies improving conditions.

Conducted among senior executives of Redas’ member firms, the quarterly survey showed that nine in 10 developers expect the global economy to slow down, with three in four expecting the increase in interest rates and inflation to affect market sentiment over the next six months.

“Job losses, decline in domestic economy, excessive supply of new property launches are other potential risks that will adversely impact the market sentiment,” the report said.

Meanwhile, seven in 10 of the respondents expect new launches to moderately increase, while more than a fifth of the developers said they will launch relatively fewer units.

On price changes, six in 10 expect residential property prices to drop moderately in the next six months.

As for the impact of the cut in supply of the first half 2016 Government Land Sales (GLS) programme, around six in 10 anticipate minimal impact on demand in the commercial and residential property sectors.

One developer noted that a lack of new launches may see buyers revisiting the secondary market. “The lower GLS supply will provide support for prices, which lead to lower new developer sales. Some buyers will revisit unsold and resale units in existing projects.”

MND says no to relaxing property cooling measures

The Ministry of National Development (MND) said it is too early to relax the property cooling measures, according to media reports.

The cooling measures include extra stamp duties to rein in speculative buying as well as the total debt servicing ratio (TDSR) framework which was rolled out last year.

Even though there is decline in home sales, prices have remained relatively stable.

“It is still too early to relax the property market cooling measures. If the measures are removed prematurely, we could see a sharp increase in demand and housing prices,” said a spokesman.

He added that the measures were placed to “ensure a stable and sustainable property market.”

MND’s statements came after property developer Kwek Leng Beng warned of a possible impact on the country’s the reputation as a global city, while calling for a review of the property cooling measures.

The National University of Singapore (NUS)’s Residential Price Index showed that resale home prices rose 0.8 percent month-on-month in May, after dropping for nine months, while Urban Redevelopment Authority (URA)’s flash estimates for private home prices showed a 1.1 percent decline in prices in Q2 2014 or its third continuous quarter of price decrease.

Christine Li, OrangeTee’s Head of Research and Consultancy, said the government will remain cautious since interest rates remain low and Singaporeans are still keen on investing in property.

“Four years ago, mass market units were about $700 to $800 psf. Now, the more attractively priced units are already nearing $1,000 psf,” she noted. “I think upgraders from Housing Board flats in particular will still prefer a steeper price correction.”