Because of the market gloom, Singapore is not likely to see major launches for residential property for the rest of 2008. Buyers are staying away thus making developers hold back their launches. However, industry experts suggest that by early next year, launches with attractive prices will come soon.
For developers on the other hand, who have launched their projects already for this year, selling is to continue. According to Ku Swee Yong, Savills Singapore’s director of marketing and business development, new launches for the first half of 2009 will be as “quiet as the second half of this year”.
Demand for new homes has slowed. In fact, private home prices fell by 2.4% while high-end properties fell by 12%. Ku Swee Yong says that majority of the launches will be targeted to the mass market segment, which the HDB resale market will support.
For now, the market is idle where a lot of buyers have not committed themselves because they are waiting for prices to fall further.
On a lighter note, construction costs might come down next year. Nicholas Mak, director of consultancy and research of Knight Frank, said, “If they do not launch now, they can then wait for construction costs to fall before locking in lower costs, which would give them more pricing flexibility.”
However, despite the major hold, the Urban Redevelopment Authority’s data says that there is a strong supply of residential properties ready for launch. In fact, the present number of units that are not yet launched is at 40,400 units – that’s equivalent to five years’ supply.