Talking about property—–what is still hot lately?
If you ask the property agents, they will tell you —everything. The way i see it, life has never been so rosy for property agents until the last couple of years. And this year is really a very good year for them all. You can always see them everywhere, the neatly dressed familiar figures with file in one hand, plastic tag handing loose from neck to showing which real estate firms they are from —-running around closing sales.
Working and interacting closely with bankers and a few select real estate agents, I can feel that there are signs that the private condo/apartment market is showing signs of slowing down. The reasons being —too many coming on stream from all directions, developers trying to off-load as many units as they possibly can, price reaching a level that hits buyers’ affordability threshold . The way i see it, this sector has reach a plateau and likely to stay flat for sometime until the surplus stock is taken up. As to when it will take off again is anybody guess. But personally I do not expect a acute dip in price here as the economy is still vibrant and there is no intention by those in charge to slow the growing population.
On the HDB front, HDB resale is still very hot and selling like Macdonalds at Liat Tower. Somebody in the HDB had done some miscalculation and reduced the supply side from 2002 onwards. That was a boo-boo. As a result of this mismatch, the present fierce demand for low cost housing can only be met by the supply from the HDB resale market. The great influx of buying by foreigners who have become citizens and PRs have also weighed in on the pressurized demand. If you ask me, putting your money ( provided you meet HDB rulings) in a well select big unit HDB near MRT is still the best bet if you are looking for something with good upside potential. Need I tell you why?
The next sector that is still hot is landed properties of all shapes and sizes. There is this perception among increasing number of landed buyers that paying $1000 for per sq ft on landed is better that putting same or more on a apartment space in the sky. While you can increase your living space in a landed, you cannot do that with a apartment. The demand for freehold/999 leasehold landed is so strong that sellers are now playing hard to get and asking price that banks are reluctant to match. If this trend continue, you will now see a COV ( cost over value) syndrome taking over this sector of the market. The reason for the heated demand is scarcity. At present landed constitute 6% of the total 1.2 million households. If you look at detached and semi-D houses they comprise 2.7%. This number will only get smaller as supply is diminishing. Government’s release land is mainly for high density housing. Occasionally they do release pockets of lip-service supply for 99 year landed.
In the last 3 months, I have arranged an increasing number of loan packages for purchase of landed properties by foreigners( PRs). Almost all share the same perception —-they all see greater appreciative value in parking their money in a good landed property.They all believe that landed will still have room for price to go up. They all have stable income and have intent to make Singapore their permanent home. More importantly, they all have no problem getting approval from the authority to buy as long as it is one and for owner occupation.
So if you ask me, I believe that even in this high market, there is still a good buy ………….provided you have deep pockets and a good nose.
Moses CM Tan
Synergy Business Network
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Mobile phone; +65- 96359288