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SG New home sales to moderate next year, says Maybank

Property Here - Wednesday, December 18, 2013

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The property sector is expected to moderate in 2014, with new home sales moderating to 13,000 to 14,000 units, or down from the “estimated ~16,000 units to be sold in 2013”, according to Maybank Kim Eng.

Following almost four years of continued increase, residential prices are expected to decline next year.

Maybank said that this will likely culminate in “a ~10 percent decline in private residential property prices, led by the mass market segment.”

Notably, the quarter-on-quarter increase in the Urban Redevelopment Authority’s (URA) Residential Property Price Index (PPI) is moderating, given the seven rounds of property cooling measures implemented by the government since 2009. However, Q3 2013 PPI was still 3.9 percent higher than last year.

Meanwhile, the number of new private homes sold by developers dropped 30 percent in the 11 months of 2013 to 14,964 units (excluding Executive Condominiums or ECs) from 21,288 over the same period last year.

With this, Maybank expects 2013 to end with sales of “~16,000 units, ie, ~30 percent drop from 2012’s robust figure of 22,698 units.”