Has the market reached its peak?

Property index climbs mere 0.1% in July

The prices of completed condominiums and apartments showed early signs of stabilising in July from the peak levels recorded in previous months.

This is according to the latest reading of the Singapore Residential Property Index (SRPI) developed by the National University of Singapore’s Institute of Real Estate Studies.

The index tracks price movements of a basket of completed non-landed residential properties based on factors such as the development’s location and its sales volume.

In its latest reading, the overall SRPI recorded a marginal 0.1 per cent increase to 151.8 points in July from the previous month.

This compared to the index’s overall reading of 151.6 in June, up 0.6 per cent from a month earlier.

Meanwhile, the SRPI for the central areas dipped 0.6 per cent in July to 161, while the reading for non-central areas rose 0.7 per cent to 148.5.

“Actually, the market went quiet in May and June. Even in July, it was only completed projects that saw very good sales.

“So, the market was already getting more cautious. On the whole, prices have not been going up much,” said Ms Chua Chor Hoon, DTZ’s head of South-east Asia research.

Industry experts attributed the price slowdown to dampened buyer sentiment amid uncertainty over the global economy.

Mr Donald Han, managing director of property consultancy Cushman and Wakefield, said: “The fall in the prices in prime areas could be due to the fears over a double dip in US markets and property cooling measures in China and Hong Kong.”

“These may have taken the wind out from under foreign buyers, especially since they make up some 35 per cent of the buyers in the high-end property market here. Also, sellers may be more receptive to lower prices,” he added.

Market observers added that it might take a few months to get a feel of how the local property market would respond to the new cooling measures announced earlier this week.

This response can be tracked by attendances at property launches and responses to land tenders, they said.

Source : Today – 3 Sep 2010

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