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SG Property stocks fall on latest measures

Property Here - Thursday, August 29, 2013

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The Singapore property index tracking 43 stocks fell 1.4 percent to 692.64 at the close of trading yesterday – the lowest in the last year.

The decline was attributed to the government’s latest housing measures including reduced home loan tenures and buying restrictions on newly-minted permanent residents (PRs). 

Regulations in the public housing market affect private developers as they rely on the 82 percent of Singaporeans who live in flats who would soon upgrade to condominiums. 

“These measures continue to be negative for the Singapore private residential market, given that upgrader demand has contributed to a significant portion of mass-market private residential housing demand...A weaker HDB resale will impinge on upgrader households’ ability to monetise their flats,” said a report from Citigroup. 

Among the major developers, CapitaLand fell 2.3 percent to S$2.93, the lowest recording since 24 July 2012, while City Developments Limited slipped 2.2 percent to S$9.76.

Moreover, analysts at Credit Suisse Group AG, said: “In an already weak market, we expect the incremental measure to be taken negatively by the market.” 

“We still expect near-term property prices to be flattish supported by low vacancy and healthy balance sheet.”

 

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

The Singapore property index tracking 43 stocks fell 1.4 percent to 692.64 at the close of trading yesterday – the lowest in the last year.

The decline was attributed to the government’s latest housing measures including reduced home loan tenures and buying restrictions on newly-minted permanent residents (PRs). 

Regulations in the public housing market affect private developers as they rely on the 82 percent of Singaporeans who live in flats who would soon upgrade to condominiums. 

“These measures continue to be negative for the Singapore private residential market, given that upgrader demand has contributed to a significant portion of mass-market private residential housing demand...A weaker HDB resale will impinge on upgrader households’ ability to monetise their flats,” said a report from Citigroup. 

Among the major developers, CapitaLand fell 2.3 percent to S$2.93, the lowest recording since 24 July 2012, while City Developments Limited slipped 2.2 percent to S$9.76.

Moreover, analysts at Credit Suisse Group AG, said: “In an already weak market, we expect the incremental measure to be taken negatively by the market.” 

“We still expect near-term property prices to be flattish supported by low vacancy and healthy balance sheet.”

 

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