There has not been much activity in the private property market in October compared to other months.
In the first nine days of October, approximately 350 private homes were sold – far less than September’s sales.
The pace of buying did not seem to have picked up even for the succeeding weeks of the month, said property consultants. They claimed that the market appears to be pausing for breath as home buyers prefer more affordable prices.
According to Savills Singapore, caveats lodged from the 1st to 9th day of the month recorded 355 sold residential units, including only 52 sub-sale units and 40 new housing units, compared with the 787 units sold in the first nine days of September, which included 102 sub-sale units and 276 new homes.
In the first nine months of 2009, sales of new private homes reached a recession-defying 12,828 units, sub-sales hit 2,780 units; and resales totaled 10,185 units.
Property experts said the quiet market mirrors the increase in home prices over the last six months. The quarterly price index of the Urban Redevelopment Authority registered a 15.8 percent increase – the highest in 28 years, from July to September.
Mass market prices have now surged to its last peak levels, said market watchers.
Chua Chor Hoon, DTZ head of research for South-east Asia, said home prices have generally stabilized, and will possibly increase moderately in line with economic recovery.
“In the past six months, the market had raced ahead of economic fundamentals. The high sales volume was not sustainable so what we are seeing now is a return to more sustainable levels,” she explained.
New home sales in 2009 are likely to be similar to the record of 14,811 in 2007, but sales next year should fall back to close to the average, she added.
The mid-September measures of the government to pacify the property market also caused the home buyers to think twice, particularly with increasing prices, said the experts.
According to Tan Tiong Cheng, Chairman of Knight Frank, the market during that time was already starting to slow down, after several months of surging furiously.
“At the end of last month and the start of this month, after the Government removed the interest absorption scheme, buyers were concerned about the impact of the move and what’s next,” said Mohamed Ismail, chief executive of PropNex. “But for us, resales have picked up.”
However, the market for new launches seems to be quieter as no chief suburban launches are expected this month.
“October is quieter compared with the previous months. Generally, launches have moved from the mass market ones to the mid- to higher-end projects, which entail larger price quantums. So some buyers may need a longer time to consider and commit,” said Phylicia Ang, residential director of Savills.