Relief is possibly on the way for the Singapore private property market. This year, the industry struggled due to falling prices and a general lack of enthusiasm. Ever since the government stepped in and enforced limits on financing, the Singapore market has rapidly begun to fall behind. And although buyer disinterest continues, developers are hopeful that 2016 will be more prosperous.
In the first six months of the year, real estate services JLL estimates only 3,496 private residential unit sold, a 21 percent decrease compared to last year. The lack of sales has nose-dived prices. Property prices are projected to reach a total decline of 6 percent by year’s end. Developers typically shy away from giving discounts any more than 15 percent of the initial asking price even in such a difficult situation. Fortunately, the upcoming general election has generated buzz around the potential end of government cooling measures in the near future.
Since 2009, the Singapore Government has placed restrictions on the housing market aimed at foreign demand in an attempt to stabilize market prices. Singaporeans currently have to pay an Additional Buyers Stamp Duty of 7 percent on their second home, and 10 percent on the third. Management companies are in hopes that the September or October general election will work in the favor of Singaporeans, rolling back additional fees.
In the current state of affairs, sellers aren’t the only ones feeling pressure. Renters currently face a dilemma due to a strong demand-supply imbalance. While 26,000 housing units are expected to be completed by year’s end, last year’s peak demand only hit just above 15,000. This year isn’t projected to be much different. This makes it difficult for renters to raise their tenants rent, hoping to keep up with the competition. A slow decline in the expatriate population further skews the issue.
With the continuos decline in rent, sellers and renters can only hope for a turn-around in this fall’s general election.
from Anthony S Casey and Real Estate http://ift.tt/1MgSt8q