There have been differing views on the effects of July’s property cooling measures.
Market statistics have not been clear about the direction it is moving toward, though most industry watchers are inclined to consider at best a stabilising market.
Survey detects falling real estate market sentiments
According to the Real Estate Sentiment Index (Resi), a joint effort between the Real Estate Developers’ Association and the National University of Singapore’s Department of Real Estate, the Resi index fell sharply from 6.6 to 4 following July’s property cooling measures.
The survey also showed that some of the factors most likely to affect the market in the months ahead include:
- Rising inflation and interest rates
- The decline in the global economic markets
- Slowdown in local economic growth
- Restrictions in financing
Market performance in next 6 months to a year crucial
It may ultimately all come down to how the property market performs in the next 6 to 12 months as external and local economic uncertainties cloud the current outlook. Add the increased transaction and redevelopment costs which now encumber buyers and developers, and the market may labour beneath it all.
As the number of unsuccessful collective-sale transactions grow, the survey is also finding that 90.2% of the respondents consider the ABSD hike to have a serious effect on the en bloc market in the next 6 months.
There have been sharp declines in the third quarter for some sectors. How will the market perform in the last quarter of the year?
Will that dictates the direction it takes in 2019 or will the new year bring changes which may temper the daunting outlook for the local real estate sector?