Home buyers expect prices to keep going up: Property portal

More prospective home buyers are concerned about rising prices and many believe properties in Singapore are too expensive.

Real estate portal PropertyGuru.com.sg’s consumer property sentiment index fell to 2.6 (from a scale of 5) in the second quarter, compared to 2.8 in the previous quarter.

“What it says is that buyers expect the transactions and prices to carry on going up and so the expectation is that they are going to have to pay a higher price in the future. And as a result of that, they want the Government to do more,” said Mr Steve Melhuish, chief executive officer and co-founder of PropertyGuru.com.sg.

Over 2,200 respondents participated in the quarterly survey that measures consumer sentiment and tracks property buying decisions. Around 79 per cent of those surveyed say Singapore properties in all segments are expensive. And 34 per cent say they will not buy property due to the high prices.

Mr Adam Tan, PropNex’s corporate communications manager, estimates that prices will increase 10 to 12 per cent in the HDB market and 8 to 10 per cent for the private home market for the whole year.

Already some home buyers and investors are turning to commercial properties and overseas investments, with those in Malaysia, India and Australia increasingly popular.

“Malaysia as a country has extremely strong fundamentals and the property market there tends to be a lot less volatile,” said Mr Tom O’Reilly, director at Singapore Tenancy Management.

“For the same amount of money, people can often afford to invest in multiple properties in Malaysia which helps them diversify risk and still generate positive returns,” he added.

Meanwhile, Bank of America-Merrill Lynch is maintaining an “Underweight” rating on Singapore residential properties, citing potential oversupply in the housing market between now and 2015.

And analysts at SIAS Research are recommending commercial Reits based on expected rental and values growth in the next few years.

Source : Today – 29 Jul 2011

Join The Discussion

Compare listings