Tag Archives: Singapore Property

City fringe homes drive rental growth

Posted on 26 May 2014 | Comments Off on City fringe homes drive rental growth

Leasing demand in the private residential market remains healthy, according to a new Savills report today.

Rental volumes islandwide increased by 4 percent year-on-year, as the Urban Redevelopment Authority (URA) showed there were 13,077 leases of private residential homes, excluding executive condominiums, in Q1 2014.
37 percent (or 4,839 leases) of these were in the city fringe areas, higher than the 30.6 percent and 32.4 percent recorded in the Outside of Central Region (OCR) and Core Central Region (CCR) respectively.

Residential properties in the city fringe areas are probably more appealing as expatriates in Singapore try to balance tighter rental budgets with accessibility factors.

“These housing options likely fit better to their current budgets, yet still remain conveniently accessible from the city area. Tenants these days are also offered a wider variety of locations in the Rest of Central Region (RCR) to pick from, as there is an increasing number of newly completed developments,” the report explained.

Rental volumes by market segment, 2004–Q1/2014

The overall rental index of private residential properties continued to ease 0.7 percent quarter-on-quarter (QoQ) in Q1 2014.

The vacancy rate climbed to 6.6 percent from 6.2 percent in the previous quarter, which translated to 19,284 vacant units out of the current 293,283 private homes available throughout Singapore. The increase was mainly due to the spike in the East region, whereas vacancy rates either remained flat or declined in the other regions.

More pressure on residential rents is expected this year, especially in the high-end market, as expatriates’ housing allowances continue to be trimmed, as well as the increasing number of newly completed high-end projects.

However, the expected rise in Singapore’s economy should help to support the pace of growth in private residential leasing demand although rents could remain flat or soften due to increasing supply and the tighter rental budgets.

Alan Cheong, Senior Director of Savills Research, said, “A stalemate has developed wherein increasing new supply and tighter rental budgets face off against an improving economy.”

Source : PropertyGuru

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Proportion of foreign buyers rises

Posted on 24 May 2014 | Comments Off on Proportion of foreign buyers rises

The proportion of foreign buyers in the Singapore property market is on the rise following recent price falls, according to data published by CIMB in its Cost of Living survey.

The report, published yesterday, said: “Foreigners view Singapore as a good city to own a piece of property, but cited high property prices as their key deterrent. In a separate survey of foreigners not based in Singapore, 35 percent of the surveyed population believe that the biggest draw for investing in a property in Singapore is its infrastructure and security, with Singapore being seen as a clean and efficient city.

“However, when asked what the main deterrent to buying a property was, the majority (83 percent) cited high property prices and softer outlook. Obviously, our survey also has some shortcomings as Indonesian tycoons or Middle Eastern tycoons are unlikely to take part in our survey.”

It added that in reality, these views are also reflected in lower take-ups by both foreign and investment demand.

“Foreign demand has fallen, now making up less than 10 percent of new sales compared to 15 percent two years ago. Investment demand has fallen as well, with upgraders making up more than 60 percent of new sales versus 50 percent two years ago.”

Just like locals, CIMB believes the expectation of falling prices is the main deterrent to buying properties now. Singapore remains fundamentally a good city to own a property and demand should be supportive when property prices fall to a reasonable level.

It said: “In our view, that reasonable level is a 10-15 percent decline in the next two years. With the recent fall in property prices, we have already started to see the proportion of foreign buyers creeping up.”

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