Many different parties have either voiced out or predicted that the cooling measures in Singapore would be lifted soon. Singapore: Easing of cooling by end 2015 – DBS Well, this has been dampened by views from Ravi Menon, the managing director of Monetary Authority of Singapore (MAS) He said that any actions to lift the cooling measures are premature. This is because as at currently, the easing of property prices in the market has been modest.
Ravi said, “Property prices have softened somewhat, but like I said last year, in the context of the price increase that had occurred – 60 per cent over three years – the softening we have seen is really not all that much. So, it’s still premature to consider removing any of the cooling measures that are in place.” Actually, property prices in Singapore has been on a downtrend and based on the peak, it has eased 7 percent. Perhaps this is still considered too modest and MAS wanted the prices to ease further.
Just like Malaysia, the property prices began their climb in the middle of 2009, just after the recovery from the global financial crisis. Funds needed investment avenues and property became a natural choice because prices then were considered very low in comparison to the more popular property markets. In Penang, back in 2008, a 1,258 sq ft condo was still selling for below RM300,000. Yes, it was only slightly above RM200 psf. Today, the same condo is selling for around RM700,000. The price has shown no signs of weakening today.
Some other views include that of Mr Leong Wai Ho, economist at Barclays. He said that the current market cooling is still happening in an orderly manner and should be allowed to continue. Mr. Ku Swee Yong, the CEP of property firm Century 21 said that due to the still-strong Land Sale tenders and some better response in the new launches, perhaps now is not yet the best time to pull back the curbs. Singapore’s National Development Minister Khaw Boon Wan summed it up the best when he said that ‘there is still rooms for prices to moderate.’
The sign is thus very clear. The Singaporean government expects and will keep measures to ensure that prices continue to moderate, at least until a level they feel is enough before loosening the measures. We should note that a feverish level of property investment would ultimately lead to bubble. Thus, it’s prudent to remind everyone to keep a cool head; sellers to sell at more realistic prices, buyers to be able to buy something affordable and not ‘hot expectation’ while developers would have to rethink ‘affordability.’
In Malaysia, even though many said that property prices has not yet come down from previous highs but a look at today’s new launches clearly show that the property prices has eased to a more affordable level. I still remember clearly in 2012 that there were very few new condos being launched at around RM500,000. Today, this prices around RM500,000 is the norm and many of these projects include two car parks! Happy buying your first property. There is no need to rush into any decision.
written on 25 July 2015
Next suggested article: Singapore: Higher auctions and bargain hunters
