SG Private home sales to fall in 2013, says report
Property Here - Thursday, May 30, 2013
By Romesh Navaratnarajah:
Primary private home sales this year will moderate to between 15,000 and 18,000 units from last year’s 22,197, according to DTZ Research.
But total developer sales could still be higher than the 15,000 to 16,000 units sold in 2010 and 2011, as developers try to launch more projects to avoid the increased competition from the substantial completions this year.
As of end-Q1, the Urban Redevelopment Authority (URA) estimates that around 14,000 units will likely be completed for the remainder of 2013. This is on top of the 35,000 units yet to be launched and sold, of which about 10,000 have received pre-requisites for sale but are yet to be launched.
The government’s cap on the number of units in residential developments could result in a decline in sales of shoebox units, which hit a record high last year.
“Secondary sales are expected to continue to underperform relative to primary sales as individual sellers in the secondary market are unable to entice buyers with discounts and incentives like developers in the primary market,” noted DTZ.
Moving forward, investment demand is expected to moderate due to stricter financing restrictions and higher stamp duties from the government’s latest round of cooling measures.
“In addition, we expect rental growth to continue to slow down due to the substantial number of completions this year and lower rental demand as a result of the government’s restrictions on foreign labour inflow,” said the consultancy.
Romesh Navaratnarajah, Senior Editor of PropertyGuru, wrote this story. To contact him about this or other stories email firstname.lastname@example.org