Buyers and investors continue to put their faith in brick and mortar, says one analyst.
Aside from the belief that the property market is bottoming out, the city-state’s uncertain economy has seen investors turning to residential property.
“This may sound counter-intuitive, (but) people are buying because the economy is bad,” said Savills Research Head Alan Cheong. “People are buying now because they have lost a little bit of faith in what are alternative investments, and so they are putting their faith in brick and mortar.”
Data from the Urban Redevelopment Authority shows that sales of new private homes, excluding executive condominiums (ECs), jumped by around 64 percent year-on-year to 6,039 units in H1 2017, reported Channel NewsAsia.
In fact, this year’s new project launches and showflats have drawn huge crowds while registering strong sales figures.
With prices on the downtrend for the last 15 quarters, most buyers are lured by the “fairly attractive prices” of units and “hope to take advantage before the market turns around”, said JLL National Director of Research & Consultancy Ong Teck Hui.
The attractive offers for en bloc sales sites and the aggressive bidding of developers for government land also led buyers to believe that prices will increase in 2018.
Looking ahead, Cheong expects upcoming launches for the rest of 2017 to do well, with private residential sales reaching between 11,000 and 12,000 units this year.
But while he expects the positive buying sentiment to continue in 2018, he does not believe that sales will increase beyond this year.
“It all depends on the Government Land Sales programme next year, and also the collective sales sites – when they get launched in 2018. If some get deferred to 2019, and if we don’t have new supply, then primary sales numbers will also come down.”