Home buyers believe property prices are set to fall further and hence, are biding their time
When investor relations consultant Gary Teo reaches for his newspaper every morning, he reads the property news first.
He and his wife, Grace Tan, 32, a senior QA engineer, are looking to buy a place of their own. They have been living with his parents in a terrace house at Novena since they got married in September last year.
'I've been wanting to live independently and now that I'm married, all the more I want to live on my own,' says Mr Teo, 31.
However, he is in no hurry, although he has been househunting since 2007. 'I'm waiting for prices to fall further,' he says, confident that it is now very much a buyer's market.
So he keeps tabs on property sales online and pores over the classified ads. The couple want to buy a three- or four-bedroom apartment in central Singapore. 'Our budget is no more than $1 million,' he says.
They either did not like the few apartments they have inspected or the asking prices exceeded their budget.
Many others are like Mr Teo: buyers playing a waiting game, believing that sellers will blink first.
And all signs point to buyers getting their way, although Mr Eugene Lim, 42, associate director at property agency ERA Asia Pacific, says the private property market is currently at a 'standstill' because sellers are still struggling to come to terms with the drop in property prices.
Mr Chris Koh, 42, director at Dennis Wee Properties, says it used to take about two to four weeks to sell an apartment. Now he sees some apartments on the market for more than three months because 'the prices asked for are too high and unrealistic'.
Home buyers prefer to wait till second half of the year
The truth is, private property prices have indeed fallen, some by as much as 25 per cent over the past year (see graphics).
Sensing this, 'buyers are just starting to bargain-hunt', says ERA's Mr Lim.
Mr Koh agrees that 'home buyers are taking the wait-and-see approach and thus are not committing to purchases'.
He adds that buyers expect property prices to fall even further and they are looking to buy only 'in the third or fourth quarter of this year'.
The reason is simple: Analysts are predicting further uncertainty in the economy and home prices may fall another 10 to 20 per cent.
Today's home-hunters are 'mostly young couples who are looking to buy their first home', says Mr Koh, unlike upbeat times such as in 2007 when people bought property for investment.
Graphic designer Edmund Seet, 35, and communications consultant Delicia Tan, 30, are getting married in June. Armed with a $600,000 budget, they are looking for a two-bedroom apartment in East Coast.
'This will enable us to have more cash for renovations and furnishings,' says Ms Tan.
Like Mr Teo, she believes that property prices will drop further during the year and so have yet to sign on the dotted line.
She and her fiance monitor property listings regularly, visit new showrooms in the area and keep a lookout for banners and signs that advertise units for sale.
'We may buy only in June,' she says.
They are playing it cool because they have a back-up plan: They will rent an apartment from a relative if they cannot find a suitable one to buy after their wedding.
There is no doubt buyers have the upper hand in today's market, says Mr Vincent Koh, 36, vice-president at HSR International Realtors.
He cites examples of sellers who will let go of their property at 10 per cent less than their desired selling price.
'Some are so desperate, they may offer to pay for the buyer's renovations, so they can get the property off their hands,' he says.
It is not just individual sellers who are finding it tough.
The property experts decline to give specific details but reveal that they have heard of developers who throw in sweeteners such as waiver of maintenance fees to entice buyers.
Which is good news, but not good enough for many buyers such as art director Adrian Low, who prefer to wait.
Currently renting a two-bedroom apartment in Lavender, the 36-year-old bachelor wants to buy a three-bedroom apartment in the Braddell Road area to be nearer his office in MacPherson but does not want to pay more than $900,000.
The 20 apartments he has viewed are not close to an MRT station and eating places. More importantly, the prices he has been quoted are not ideal.
'I'm waiting till prices drop to $800,000,' he says.
He could get his wish, because the times are a-changing.
In 2007 when sales were upbeat, 'sellers were more arrogant and would often increase their price once an offer was received', recalls ERA's Mr Lim.
In the current climate, he says, 'sellers' instructions to agents are to relay any offer to them for consideration'.
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