“The rebound in prices broadly signifies that the government’s temporary relief measures have done their job in shoring up consumer confidence and prevented a panic selling situation from developing in the property market,” says Dr Tan Tee Khoon, Country Manager, Singapore, at PropertyGuru.
The Guru View:
Key findings of the Property Market Index Q3 2020
1. We Observed A Slight Growth in Property Asking Prices
- In the quarter, the asking prices in the non-landed private residential sector saw a surprising increase despite a significantly higher number of listings on PropertyGuru.
2. There Were More New Launches Than Resale Condos Sold
- A higher than usual proportion of new launches sold in the quarter could have contributed to the marginal increase in the price index.
- New launches continue to be favoured in the current market as the majority of investors feel that by 2022 to 2023, when the majority of launches are slated to be completed, the global economy will be back on track and the COVID-19 situation, under control.
3. MRT-Accessibility Remained A Key Priority
- Seven out of 10 condos were located within a 10-minute walk to the MRT station, indicating that buyers continue to place high emphasis on the transport- accessibility to a property.
- Six out of the top 10 best-selling projects in the quarter were also launched prior to 2019.
4. Buyers Prefer Larger Developments and More Spacious Units
- Large developments that typically have larger plots of land and more comprehensive facilities made up most of the top 10 bestselling projects in the quarter.
- On the ground, it was also observed that buyers prefer more spacious units, likely due to the expectation that the work from home culture is set to stay for the longer term.
- This aligns with the findings of PropertyGuru’s Consumer Sentiment Study H2 2020, where 33% of the respondents indicated a preference for bigger layouts.
5. Investors Are Likely To Continue Buying Property
- On the investor front, we expect an increase in demand for less volatile assets like properties in H2 2020. This is a common trend during economic slumps when interest rates are low and consumers are tight with their money.
What Can We Expect Ahead?
- Although we expect higher price elasticity among resale property owners in the second half of 2020, large discounts are unlikely to surface in the new launches market en-masse as transaction volumes recover and developers are given a reprieve with the temporary relief measures.
- Furthermore, the record volume of flats reaching MOP within the next two years should provide the private market with a steady stream of HDB upgraders taking advantage of this window of opportunity amidst low interest rates to upgrade.
- Investors and property owners can take heart that even if a worst-case scenario pans out in the property market, minor tweaks to the present cooling measures will very quickly reinvigorate the markets back with fervour.
View Our Past Property Market Index Reports from 2020
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