Property prices lower, ‘but still out of reach’: Survey


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13/10/2014

SINGAPORE: Prices of residential properties may have fallen over the past few months, but they are still too expensive and buyers are increasingly waiting on the sidelines for prices to drop further, a survey has showed.

Nearly a quarter, or 22 per cent, of respondents do not plan to purchase property at the moment, up from 10 per cent six months ago, showed a half-yearly Asia Property Market Sentiment Report by real estate portal iProperty.com. Some of the reasons cited include high prices and the challenge of the down payment.

“Buyers are biding their time, with affordability and financing as top concerns. While the number of respondents who intend to purchase within the next 24 months remains the same at 51 per cent, buyers may wait for new and resale private condo prices to fall … The market is now correcting after the rapid rise over the last few years, and demand is there at the right price point,” said Mr Sean Tan, general manager of iProperty.com Singapore.

Several rounds of cooling measures have seen the value of both private and public properties fall. In the second quarter of this year, private home prices were about 3 per cent off the peak in the third quarter of 2013, while public resale home prices were down 5 per cent from its peak in the second quarter of last year, data by the Urban Redevelopment Authority and Housing and Development Board showed.

A majority of the survey respondents, or 53 per cent, think that both new and resale private condominiums will see further price declines this year. Against that backdrop, the survey saw a 15 percentage point increase in the number of home owners who want to sell their properties, compared with six months ago.

“The report shows that both property sellers and buyers are nervous a year after the start of the Total Debt Servicing Ratio (TDSR). In the second half of 2013 report, just after the TDSR was announced, 59 per cent of owners were confident their properties would retain its value; now only 38 per cent think so, a decline of 21 percentage points. Another 25 per cent are unsure if the value will be retained,” said Mr Tan.

The survey, which polled 2,805 respondents in Singapore, also found that a majority of them, or 56 per cent, are in favour of the Government’s decision to keep cooling measures in place despite repeated calls by industry practitioners to tweak some of the curbs.

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