If sales volume are anything to go by, signs of the resale private property market rebounding could be imminent.
Since the fall of prices of resale units to equivalent of or lower than new private non-landed properties, the number of transactions have increased significantly. Within the first 4 months of 2015, transaction volume has seen a 20.7 per cent increase. Resale properties are often ready for immediate occupancy and rental, thus buyers tend to favour these units to new ones in order to skip the wait of building and construction. The rental opportunities to be had within the few years it takes to build a new residential property could be quite substantial. And oftentimes, resale units tend to have a bigger floor area.
Though the number of transactions, 1,411 from January to April this year, is still lower than the 2,203 in a year-on-year comparison with the peak in 2013, property analysts are upbeat about the market as the year moves on. It could show that buyers are finally getting used to the cooling measures, in particular the TDSR (total debt servicing ratio) framework, and realising that the market could be reaching a plateau. Sentiments could be that this is the time to buy, before prices and interest rates start climbing again.
The promising signs could be seen across the island, though more markedly in Districts 5, 10, 15 and 23. Some of it could be due to the fall in prices over the past year, and some the potential of having the future Downtown MRT line in close proximity. Even the Central region’s luxury properties have seen a recent boost in sales numbers of 24.2 per cent, most evident in Districts 9 and 10.