Sentiment for the property development industry in Singapore has improved marginally in the second quarter.
This according to the latest survey jointly developed by the Real Estate Developers’ Association of Singapore (REDAS) and the NUS Department of Real Estate.
According to the Real Estate Sentiment Index (RESI), the outlook for Singapore’s real estate market is showing a modest improvement compared to the previous quarter.
The Composite Sentiment Index, the derived indicator for overall real estate market sentiment in Singapore, stood at 4.7 in 2Q12, compared to 4.6 in 1Q12.
Meanwhile, the Current Sentiment Index, which tracks changes in sentiments over the past six months, rose to 4.9, up from 4.8 in 1Q12.
The Future Sentiment Index, which tracks market expectations for the next six months, increased slightly to 4.5 from 4.4 in 1Q12.
The survey was conducted through a questionnaire given to about 280 developers and real estate players in Singapore.
The survey scores, which range from 0 to 10, measure survey respondents’ perceptions and expectations of real estate development and market conditions in Singapore.
According to the RESI, the hotel sector is expected to continue its strong performance in the next six months, but the office sector is expected to continue underperforming in the near term amidst the lack of clarity in the global economic outlook.
The survey also found that fewer developers are likely to increase private residential unit launches, with 46 percent of the developers surveyed expecting more units to be launched in the near term, down from 77 percent in 1Q12.
Almost two-third of the respondents expect prices to hold at the current level over the next six months, up from 46 per cent previously.
Meanwhile, developers are also showing a higher level of concern for the rise in labour costs, land costs and building materials costs.
Source : Channel NewsAsia – 8 Aug 2012