Private property market likely to be quiet as buyers assess trend

The property market is likely to see a quieter period after the latest round of cooling measures.

Market experts told Channel NewsAsia both buyers and developers should be taking their time before taking their next steps.

The latest series of cooling measures announced on January 11 has spurred some property buying to beat Saturday’s deadline.

For instance, Far East Organisation (FEO) sold just 22 units during the weekend despite a five per cent discount offered on all its projects.

That is almost less than half of the 38 units moved on January 11 alone.

Popular FEO projects snapped up during the weekend include eCO, Hillsta and Watertown. FEO is still offering discounts, but down to four percent from January 14-16.

FEO has no new project launches in the pipeline. The upcoming SBF Centre, a commercial property, will be its next launch.

Over the last few months, developers have been offering nominal discounts, and vouchers to entice buyers without having to formally lower prices.

And with the latest cooling measures, some analysts Channel NewsAsia spoke to say developers may take the next few weeks and months to assess the market before formulating their next sales strategy.

First-time property buyers should be the main targets of developers’ now.

This group is most unaffected by the latest series of cooling measures.

Chia Siew Chun, research director at Colliers, said: “Anything that will be able to help them reduce their capital outlay upfront would be welcomed. It depends on what form it comes from the developer whether or not it is a discount. I think (a discount) is probably highly unlikely.”

Chia added: “In the beginning (when the measures are just implemented), developers as well as the buyers would want to assess how the market is reacting.”

Developers are also expected to be more prudent in their sales strategies to attract new buyers.

Alan Cheong, research head at Savills Singapore, said: “The strategy will probably still be the same. If you try to be overly creative, you may invoke the ire of the government and they may say no to a more creative way of enticing the buyers back because it is against the spirit of the cooling measures. So developers will still offer the same menu set moving forward.”

Just like how the launch of Watertown just weeks after the tough cooling measures announced on December 2011 had excited the market, analysts said upcoming property launches could revive buying interest again.

Low borrowing rates and investors looking for safe havens could see more money going into property buying.

Source : Channel NewsAsia – 14 Jan 2013

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