More developers expect higher prices for new homes

The outlook of developers for the real estate sector became rosier in the fourth quarter of 2010, with a large percentage of them expecting higher prices for new residential launches.

Preliminary findings from the Real Estate Sentiment Index (RESI) showed an improved sentiment from Q3, when the industry was still dealing with the effects of the property cooling measures announced by the government on August 30, 2010.

Steven Choo, Chief Executive of the Real Estate Developers’ Association of Singapore (Redas), presented a preview of the RESI results for Q4 at a seminar held yesterday.

Based on survey responses, the Current Sentiment Index, by which respondents rate the overall Singapore property market conditions over the past six months, stood at 5.6 in Q4, up from 4.8 in Q3.

Meanwhile, the Future Sentiment Index, where respondents were asked to rate overall property market conditions over the next six months, stood at 5.7 in Q4, up from 4.8 in Q3.

“We’ve actually seen a rebound,” said Mr. Choo. “We think it is an accurate reflection of our members’ take on the market.”

Though the index reading climbed in Q4, they did not exceed the Q1 and Q2 levels.

Most of the respondents also thought that moderate price increases and more launches were possible.

In Q4 2010, 60 percent of respondents expected moderately higher unit prices, compared to 12 percent in Q3. About 76 percent of the total respondents also believed that moderately or substantially more units will be launched, up from 44 percent in Q3.

Good take-up for various big launches in Q4 buoyed sentiment, said a developer, who refused to be named. Those which saw strong sales included Waterview, Robinson Suites and Spottiswoode Residences.

Source : PropertyGuru – 13 Jan 2011