Tag Archives: Private Residential Property Market

Changing policies as market conditions change reflects pragmatic and adaptive policymaking which should be applauded

THE big picture driver of real estate wherever is the economy. A residential property buyer pays a certain amount for a particular location because he likes to work, live and play there. Should Singapore execute successfully on mega projects like the integrated resorts, improve her infrastructure, grow her economy and become an increasingly important global city, the trend for property prices is up.

Balancing act: Changing policies as market conditions change reflects pragmatic and adaptive policymaking which should be applauded. Moreover, well-timed pre-emptive moves deserve the most kudos. However, perhaps there is a case for adopting a framework where only supply measures change while demand measures remain unchanged

But how fast should prices rise? Is there excessive speculation in the Singapore private residential property market? These are tricky questions and governments everywhere, through their policies, play a major role in impacting the property market. Recently, the Singapore government, acting to pre-empt any speculative bubble from forming, unveiled both supply measures such as reinstating the confirmed list of land sales in the first half of 2010 and demand measures such as disallowing the interest-absorption plan and interest-only loans being offered to buyers of uncompleted private homes.

Changing policies as market conditions change reflects pragmatic and adaptive policymaking which should be applauded. Moreover, well-timed pre-emptive moves deserve the most kudos. However, perhaps there is a case for adopting a framework where only supply measures change while demand measures remain unchanged. This is not just about letting free market forces reign as adopting such a stand creates more certainty for developers and property buyers, both of whom are committing to sizeable investments. Whenever large sums of investment are being made, consistent regulations are called for and the residential property market should be no exception. For example, let’s be clear whether we want schemes like deferred payment or interest absorption all the time, not at all, or some of the time. Continue reading →