S’pore housing market to decline next year

The threat of a global economic double-dip and additional property cooling measures in Singapore may result in a decline of buying interest in the next six months, according to latest residential market report by Savills.

This year, Savills expects new home sales (excluding executive condominiums) to hover between 15,000 units and 15,500 units, a slight decline from last year’s record of 16,292 units.

On the other hand, leasing volume is expected to rise further as more foreigners shift from buying to renting homes.

Due to the rise of expatriates relocating to Singapore for job opportunities, leasing demand is expected to reach between 10,000 and 10,500 transactions in Q4.

Savills expects total leasing volume to reach a record high of between 44,000 and 45,500 transactions this year.

According to its data, prices of super-luxury and high-end homes are expected to remain stable in Q4, after a decline in the previous quarter.

The average unit price for non-landed high-end private homes rose marginally by one percent to S$2,268 psf in Q4, while the average price for super-luxury residential properties dropped marginally by 0.2 percent to S$3,661 psf in the same period.

Prices for new mass-market non-landed homes may grow by one percent in Q4 2011.

Meanwhile, after factoring in several creative marketing packages, prices of new mass-market homes could fall five percent for the whole of next year, while prices of high-end non-landed homes may slip by 10 percent.

In addition, rents may correct by five percent next year as a result of more completed homes in the coming months and shrinking expatriate residential budgets.

Source : PropertyGuru – 20 Dec 2011

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