Many developers expect property prices to increase by 5.0 to 8.0 percent for the whole of 2018.
Singapore developers have become more upbeat about the state of the property market, with the Real Estate Sentiment Index (RESI) hitting a record high since the index was launched in Q1 2010.
Overall sentiment improved from 6.9 in Q4 2017 to 7.1 during the first quarter of this year. In particular, the Current Sentiment Index rose from 6.9 to 7.2, while the Future Sentiment Index increased from 6.9 to 7.0 over the same period. A score above five indicates improving market conditions, while a lower score denotes deteriorating conditions.
“The real estate market sentiment has been at the all-time high after showing 10 consecutive quarters of increases since Q4 2015,” said associate professor Sing Tien Foo of the Department of Real Estate at the National University of Singapore (NUS).
“The improvements in the performance were broad-based and found in all sectors of the property markets. Prime and suburban residential markets showed the most robust performance in Q1 2018 supported by the strong take up in new launches.”
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However, the improvement in market sentiment appears to be slowing down quarter-on-quarter.
Nevertheless, 88.2 percent of the developers surveyed anticipate home prices to rise over the next six months, with about 64.7 percent forecasting an increase of between 5.0 and 8.0 percent for the whole of 2018.
Moreover, 26.5 percent of them plan to significantly increase their new launches in the next six months, while 55.9 percent intend to moderately increase their roll out of units.
On the other hand, 14.7 percent said they would maintain their launches at the same level. Only 5.9 percent expect prices to remain unchanged, while another 5.9 percent think prices would fall.
Furthermore, 65.1 percent of the respondents believe that a significant drop in collective sales is unlikely to occur over the next six to nine months despite the hike in development charges.
RESI is jointly developed by the Real Estate Developers’ Association of Singapore (Redas) and the Department of Real Estate at NUS. The data is derived from questionnaires conducted among senior executives of Redas members.
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Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email email@example.com