The local property market seems to have taken a harder hit in the third quarter as both sales and rental figures fell. While the decline was not drastic or sudden, it nevertheless points to possibly tougher times ahead.
Overall property selling prices fell 1.5 per cent while rental prices dropped by 1.2 per cent. The general global economic gloom, fears of inflation and growing unemployment rates have given way to a sense of impending recession. Buyers are likely to be more careful with their finances and though property is a good way to hedge excess funds, investors are likely to weigh yield potential even more seriously should the negative sentiments persist.
The private residential market seems to be the most affected as vacancy rates rose. Property analysts report more positive sales in the resale rather than the new homes segment, possibly because there were fewer new residential project launches in Q3. Resale property sales clocked a 15.7 per cent increase while new homes sales fell by 12 per cent.
In the resale HDB property market, prices continued to stabilise, with no significant rise nor fall. However, the number of transactions recorded fell by 5.5 per cent. Currently, overall private home prices have fallen 2.6 per cent. With only 2 months left to the year, property experts expect a slight fall in prices and transactions in the private property market, which largely dependent on market sentiments may result in a final 3 to 4 per cent decrease for 2016.