Source : 938live.sg , 24th July 2009
Analysts say the worse is over for Singapore's private property market even though private home prices continued to fall in the second quarter.
Citing a recent surge in Singapore's equity market, a spate of new developments being launched and an influx of foreign buyers, the analysts forecast home prices turning positive as early as next quarter.
Data released from the Urban Redevelopment Authority today, showed that Singapore’s private home prices fell 4.7 percent in the second quarter.
Although it's the fourth quarterly decline in residential property prices, it's less than URA's initial estimate of a 5.9 per cent drop announced earlier this month, and a far cry from the 14.1 percent plunge in the first quarter.
Steven Tan, executive director of property consultancy Orange Tee, says the numbers reflect a boost in investor confidence in the Singapore market.
"More and more buyers are confident that the global and Singapore economy is on the way to recovery and there is also a lot of pent up demand especially from the HDB upgraders. The market is also supported by foreign buyers from countries like China, Indonesia, India...some even come in quite a big way, some institutions are looking for a bulk purchase."
According to Li Hiaw Ho, Executive Director of CBRE Research, the total number of new homes sold in the second quarter exceeded the total number of new homes sold in the entire year 2008.
She attributes this to strong market sentiments from buyers worried that home prices may rise again after having corrected from peak levels.
The URA data also showed activity in the sub-sales market, which more than doubled to 940 in the second quarter, accounting for more than a tenth of all sale transactions in the quarter.
Managing director of Cushman and Wakefield Donald Han says this indicates the presence of more speculators in the market - which may not necessarily be a bad thing.
"The improvement that we're seeing certainly would attract a lot of investors, let it be investors or specu-vestors - people who can hold a little bit longer but the intention is still to sell, into the marketplace and I think even if there is speculators in the market, they still play an important role in terms of trying to create liquidity and I think there is a role for both long term as well as short term investors in today's market."
Private residential rents also fell 5.2 percent in the second quarter but moderated from an 8.5 percent fall in the previous quarter.
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