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Biggest jump in eight years. Singapore property prices. Good?

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Could you feel the positive sentiment in the next sentence? “Moving into 2018, we can feel that buyers and investors are now taking action, propelled by the ongoing market exuberance with the bullish land bids and continuous collective sales in the market.” Propnex Realty CEO Ismail Gafoor said this in an article in channelnewsasia.com It was an article about the current state of the property market in Singapore. The private home prices continued its upward trend by rising 3.1 percent in Q1 2018. This level of increase was last seen in June 2009. In the previous quarter prices rose by just 0.8 percent.

Ismail added that the overall prediction of price growth in 2018 would be between 8 – 10 percent. (I wonder if the increments are as high as this number. Hopefully it is.) He also said that he predicted that the transaction volumes would pick up, prices are set to increase by up to 5 per cent as well by the first half of the year.” The reason for these growth would be contributed by higher price points at new launches which would usually push up the resale and existing launches in the future.

Also in the article, Ms Tricia Song, Head of Research at Colliers International predicted a similar number. She said: “We now project average private home prices to rise by 8 per cent (from the 5 per cent forecast earlier) for the full year of 2018, implying a rise of another 5 per cent for the rest of the year.” She added, “We think the rise is front-loaded due to the pent-up demand and buyers’ fear of missing out on good value buys as prices trend up.” Here’s that article again.  Between prices going up or coming down, of course the owners and the buyers would be on the opposite sides. However, when supply of the units that the buyers actually wanted to buy is fewer than the demand, then prices would go up. For Singapore’s case, it’s quite clearly also caused by the ever higher land sale prices.

Ms. Tricia also added, “We remain positive on the fundamentals of the Singapore economy and are hopeful of a sustainable gradual property price growth in tandem with the GDP growth. Developers will also be mindful that the softer HDB resale prices may affect the ability of upgraders to purchase more expensive private homes.”

Well, it seems that the property market of Singapore is becoming vibrant again. For the sake of the middle income Singaporeans without a home yet, I still hope the prices do not suddenly jump too far up and too fast. Yes, my wish is the same for the Malaysian property market too. I firmly believe every Malaysian should have a roof over their head and it should belong to them!

written on 3 April 2018

Next suggested article:  If you are a millennial, you should own a home, perhaps?

 

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