Singapore Back to Real Estate News Homepage to RSS for this country

SG Property News

SG Housing supply remains a concern: report

Property Here - Tuesday, July 30, 2013

Share to:

With around 10,300 private residential units expected to enter the property market, oversupply will likely remain a key concern as vacancy rates move up over the remaining half of 2013. 

According to a report from wealth management firm Religare, new project completions will consistently rise annually with over 19,000 units set for completion in 2014 to 2015. As such, vacancies are expected to “climb to 7.4 percent by end-2013 and 8.1 percent by end-2014; leading rents and prices to potentially fall with each passing year”. 

Property prices increased by 1.0 percent quarter-on-quarter in Q2 2013 compared to a rise of 0.6 percent in Q1. Most of the growth was attributed to the mass market segment which posted a 3.8 percent increase, while mid-end homes rose by 0.2 percent and the high-end segment dipped 0.2 percent. 

Meanwhile, rentals of private homes were up 0.3 percent compared to 0.8 percent in the previous quarter. 

According to the Monetary Authority of Singapore (MAS), approximately 70 percent of outstanding mortgages are for owner-occupied homes. This reflects a high level of investment demand for private homes. 

“With looming supply and the threat of higher interest rates, we continue to avoid Singapore developers. In 2013, we continue to expect home prices to remain flattish with negative downside risks (if prices move up - government could act; the OCR +5.2 percent YTD price rise is concerning, in our view),” the report added.

 

Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories email romesh@allproperty.com.sg