The year has plodded along with diminishing enthusiasm in the collective sales market but with some light in the horizon for the private property market, with buyers keen on new launches in particular.
How is the market expected to perform for the rest of the year?
Location, freehold status and workforce population
Most analysts concur with one another on a few points when it comes to the current market situation. Buyers are now savvier and have more options while developers are pricing their cautious with their pricing.
Thus, home owners-occupiers will do well to get a few basics down pat:
#1 Check whether the property has a freehold or leasehold status
The former will receive more clout but may cost more. The price differential may be worth it when considering the property as a long-term investment.
When buying resale units, some property players also advise buyers to check common noticeboards on the property for information regarding collective sales so as not to be caught with a huge resale levy amidst other en bloc sales-related duties.
When buying leasehold properties, it would be wise to consider if you might outlive the leasehold period and if there are any CPF loan restrictions.
#2 Location, location, location
Despite Singapore’s small size, buyers are often most particular about the location of their property.
Private homes near transport nodes, schools and shopping complexes are often popular with buyers and also tenants. Thus for buyers who are looking at renting their property out, paying more for properties in a good location may be worthwhile in the long run.
#3 New launches
That said, new condominium developments of the future are mostly large ones with 1,000 units and above.
Come completion, the competition for tenants may be high when many units within the same development enter the rental market at the same time.
Thus, it would be wise to balance the cost of being near amenities to being near an area with a strong workforce.
#4 Developing districts
The latter will mean a strong rental market of properties nearby. It may also serve buyers well to consider government initiatives such as the Woodlands Regional Centre or the Punggol Digital District.
The Jurong East planning area is a good example of the growth exponential in such areas, where private residential prices have risen 70% since 2008.
Facilities are not everything but transaction data might reveal insights
Property analysts suggest exercising when it comes to paying more for facilities or design. Many larger projects may laud lifestyle themes or facilities to meet the preferences of the younger generation, but the fundamentals of the property market will stand the strength of time.
For owner-occupiers, having a functional area within the home is probably more important than having fanciful amenities.
Not all properties are born equal, even if they are within the same vicinity.
Researching neighbouring properties and having transaction data at hand is then crucial when it comes with making that final decision. Some properties may fetch a premium, or a discount, and having an idea of why could be very useful.
While the first 4 months of this year saw properties such as Parc Botannia, the Tre Ver and Affinity at Serangoon in the outside central region (OCR) selling well, how will resale properties here fare in the months ahead?
The leasing market is a profitable one if managed well. Analysts are expecting rents to rise 3% in 2019 and well-located projects are expected to boost figures while demand for rental homes by those displaced by collective sales may also rise.