Slow ride for Property Market in 2013

With the real estate sector ending on a high note last year, will 2013 be the year things begin to stagnate?

8 Mounth Sophia

2012 seems to be the watershed year for Singapore’s property market, with residential properties doing extremely well and commercial and industrial properties not far behind. Despite cooling measures rolled out twice in the year, sales and growth remained strong.

Industry analysts are however expecting prices to reach a plateau this year. They are expecting property developers to be less active in the bidding for Government Land Sales (GLS) sites, whose number has also dropped as compared to 2011. There are still sites which may draw strong interest, such as Alexandra View, Prince Charles Crescent and Mount Sophia.

Echelon

And as new properties which entered the market last year compete for buyers, affordability may remain strong. Vacancy rates for rental properties may stay low, and the possibility of new property cooling measures being implemented this year may also contribute to a less vibrant market.

The prime districts are expected to do less well, as supply overshadows the weak rental demand due to companies cutting back on housing allowances and lowered employment rates. Mass market private homes are however given the thumbs up, resilient sales buoyed by affordable prices and favoured by investors and upgraders.

The Topriary penthouses sold out

At one of Sengkang’s up-and-coming executive condominiums, The Topriary, there were once 16 penthouses.  But they are now none. All were sold out within the first two hours and at prices of between $1.3 and $1.5 million at sizes of between 1, 970 sq ft to 2, 476 sq ft.

Buyers were attracted by The Topriary’s amenities and investment potential. Situated near the soon-to-be completed Seletar Mall and existing Greenwich V Mall, home  buyers snapped up 600 units of the 700 units within the first five days. Applications have since closed last Tuesday. Other units included two-, three- and four-bedders as well as dual-key apartments.

The response is a strong indication of the market interest in ECs. HDB upgraders and those not willing to fork out the money for limited space in private properties count amongst many of those applying for the recent EC launches. CityLife@Tampines was another EC with a 4, 349 penthouse which was more than three times oversubscribed. If you’re looking out for another EC launch, then Forestville in Woodlands might be just your thing.

With property developers offering more luxury fittings and options in the latest EC launches, it makes one wonder how much further will this particular property sector have to go before it becomes entirely comparable to private condominiums and possibly closer to laying its own path to demise.

In Demand – Bigger homes

When comparing getting more floor space in an older apartment over less in a brand new one for the same price, which would you go for?

Stadia condominium in Yio Chu Kang.

Many are choosing bigger, older private condominium units over smaller new condominium apartments. One of the reasons buyers are going for resale units is prices of new properties are still on the rise.  Prices of suburban resale non-landed homes have been  on the rise for two consecutive months and it doesn’t look like it will be letting up anytime soon. It might be the sellers’ market now as demand for bigger homes is on the rise.

Will this demand push up prices of resale private flats over the next few months? Industry experts certainly think so. HDB upgraders especially may be looking in the general direction of resale private units as they are priced out of the new condominium market.

But does this mean shoebox apartments have fallen out of favour with property buyers? Though the percentage rise in prices were marginal at 0.6 per cent in October compared to 2 per cent the month before, buyers are still willing to consider this new property type. Given some  time, the popularity may bounce back up should rental prices reflect positively