Property Market Summary
1. Property market seem to continue its rise this month which prompted Minister Mentor and Senior Minister to fire the “warning shot”. However SM Goh pointed out that property price surge occurred only in the higher end sector.and prices for the middle-income and for the HDB heartlanders are still affordable, though many quarters have expressed fears of a property bubble,.
2. A HSBC’s senior Asian economist believe that there is more room for the real estate market to move upwards, because, in real term, prices of private residential properties are about 25% below the previous peak. This is because the ratio of home prices to income is only half that of 1996 due to high wage growth and low interest rates. In other words, houses in 1996 were considered much more expensive than now as the interest rates then were higher and income level were not as high as now.
3. I personally agree with that because the private homes is still in short supply, even though there will be close to 60,000 private homes coming on stream in the next couple of years, Singapore could still face a serious shortage of supply in private housing in the short term.
Demand has far outstripped supply by more than two-to-one and the 4,400 units that were added to the housing stock in the first quarter of this year had done little to quench the thirst of the insatiable market.
The nature of real estate supply is such that much of it will only materialise in mid-2009 or early 2010. Even when that comes to fruition, we are talking about only 16,800 private residential properties due in 2009.
4. To ease the crunch, the Singapore government has already come up with supply-side initiatives, such as the Government Land Sale Programme which has since been in full swing. It may add another 3,500 private homes in the next couple of years. Plus the sites of projects sold en bloc which could yield a further 19,500 more private homes, the problem may be alleviated.
5. Similar to other market, after a sharp rise, it is bound to have a correction. Not too worry, it is not a crisis but an opportunity to jump in the property market.
Free Property Valuation Service
I have some good news for you this month.
If you need to know the property value, whether as a buyer or seller, an independent property valuation can definitely help you to price the property correctly.
Now a new site www.propertyvalue.com.sg has just been set up to brings easy tracking of property values for home owners and property investors alike and it is free at this moment. Try them out.
www.propertyhomeowners.net
