Bleaker outlook on property sector: NUS-REDAS

Developers have become more bearish on the property market’s outlook
in the next six months, according to Future Sentiment Index by the
National University of Singapore (NUS) and the Real Estate Developers’
Association of Singapore (REDAS) in media reports.

The index
dipped to 3.4 in Q2 from 3.9 in the previous quarter. A score below five
indicates worsening market conditions, while scores above that suggests
improving market confidence.

In particular, 75.4 percent of the
property firms surveyed are worried about rising inflation/interest
rates. For 63.1 percent of the respondents, the next top concern is the
cost of construction, followed by a glut in new launches and a global
economic slowdown, which was stated by 53.8 percent of the developers.

Despite
the bleaker views, 31.7 percent of the respondents are eyeing a
relatively higher number of residential launches in the second half of
the year, while 29.3 percent said it will remain the same.

In
addition, those who believe that prices will continue to soften slipped
to 63.4 percent, down from 64.8 percent previously, while 26.8 percent
are optimistic that it will hold versus 26.3 percent in Q1.

Developers
surveyed were most pessimistic about the prime and suburban residential
markets, while they were most bullish on the office sector.

 

Muneerah Bee, Senior Journalist at PropertyGuru, edited this story. To contact her about this or other stories email muneerah@propertyguru.com.sg

 

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