July 2007 was indeed an eventful month for real estate investors, buyers/sellers as well as agents. First, it was a month where the GST received a 2-point increase. It means cost of living for the majority have gone up a notch.
At the real estate front, the government released a set of very promising figures showing prices of all home types had gone up; and in many areas, historical records were broken.
Then came the bad news. The government without warming announced the increase of Development Charge rate from 50% to 70% of prevailing market value. Caught by surprise, the stock market took a tumble. The stock market jittery did not get better as the US-sub prime market woes continued to worry property investors here and the STI continued to be battered right into the early part of August – with banking counters taking the full brunt of the fall.
Sub-sellers received a wake-up call and a belated financial education. They are among the most nervous lots as they tried to offload their holdings. This is because it becomes dearer for developers to acquire property en bloc, especially those with hefty DC to pay. Many sub-sellers have since lowered their asking prices amidst a more bearish sentiment.
Forecast for August: Property buying activities should return after the super-long National Day holiday break. The property market is going through a much needed breather and as long as rents continue to rise on good economic fundamentals, good sentiment should return quickly.
Edited by Sam Gian
(Singapore's Independent Real Estate Trainer & Consultant)
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