Cooling? Warming? Heating? What’s up?

Singapore’s HDB flat’s resale prices are on a downtrend even if not a lot. According to their Urban Redevelopment Authority and even some reports in the media, prices have gone down 6.8% since the 3rd quarter of last year. In Singapore, there’s no fun trying to guess because the home prices are as updated as last month! Thus, the cooling measures in Singapore is working, or is it? I don’t think we want to look at the luxury condos side which has dropped by double digits because the prices then were so high that it contributed to Singapore city being ranked the most expensive city in the world, ahead of even Tokyo, London etc.
China has meanwhile relaxed much of the cooling measures implemented earlier. Today, they are trying to warm up the market instead of letting it cool too much. Many new measures have been introduced. I just wrote about this two days ago. China’s Property Market Rescue Package Deployed. The reason for this was because the property market is threatening to slow down the whole economy of the second largest economy in the world. Average home prices fell across 100 major cities in China, as tracked by the China Index Academy. Note, these measures are likely to stop the cooling and perhaps some warming but it will be far from its crazy growth previously. In other words, perhaps the bubble may not burst this time.
In major Australian cities and London, the property market continues to heat up and bubble predictions are becoming much more common. The governments for both have denied that bubbles exist and said instead that the demand was the main reason fueling the price increase. Both countries continue to show double digit price growth compared to one year ago. Both Sydney and Melbourne grew 15% within the past one year and London grew by 20% within the same period. I am very sure the working population’s salary do not grow by such numbers.
One is cooling, another is trying to warm it up while a few more are heating up. All three situations are causing anxieties to the market in general and every analysts have their own predictions. The more important question is, which one do YOU believe more likely to happen in the near future in Malaysia, with the slowing down transactions and the pre-GST and the post-GST happening from now till Q3 of 2015. Personally, I believe volume will continue to be subdued but secondary transactions should inch upwards already, especially for those who wants a new home and is currently renting and yet still waiting by the sidelines for the prices to dip.
written on 6 Oct 2014
Next suggested article: With GST, demand may slow down next year. True?