Private resale property market to cruise on status quo

2016 proved to be a roller coaster year for the private home market, as prices fluctuated throughout the year but never quite settled into an upward swing. Price increases lasted hardly a quarter before turning the opposite direction and movements differed between regions as well.

SeletarParkResidencesAcross the board, resale private home prices rose 0.1 per cent. Most of the increase were for properties in the prime districts. Prices here rose 1.8 per cent while falling 0.9 per cent and 0.4 per cent in the city fringe and suburban districts respectively. Location continues to rule buyers’ decision-making process and prime district home prices remained stable despite the year-end lack of market activity.

As the rental market continues to wane and competition from completed properties put further pressure on rental prices, more private condominium unit owners may be pushed to sell this year as they come to the end of their 4-year holding period, after which they will have to foot their sellers’ stamp-duty bill. Buyers of resale units could have the upper hand when it comes to negotiations in these cases.

NathanResidencesThe number of private apartment units sold have been falling as well, with 484 units sold as compared to the 618 sold in November. Though the numbers are higher than the 453 units sold in December 2015, it is still a far cry from the 2,050 in April 2010 – a 76.3 per cent fall in fact. Property analysts are expecting prices and sales volume to maintain their current levels, though 2017 could be more a year of keeping the status quo than quick recovery.

Property market slowdown reflected in stamp duty collected

In 2014, the property stamp duty assessed was at $4.11 billion. This year, the total amount for the period ending March 31 was 28 per cent lower at $2.96 billion. Property prices and transaction volume have also fallen since the peaks of 2009 and 2013.

TheOceanfrontThe real estate market here has hit a number of speed bumps over the past 3 to 4 years and with the various cooling measures in place, buyers and investors have shied away from this previously almost-surefire means of investment. Introduced almost 5 years in December 2011, the Additional Buyers’ Stamp Duty (ABSD) has gradually taken effect on the market, perhaps in particular the luxury property sector which used to attract mostly foreign investors. With the 15 per cent ABSD imposed on them, and 7 to 10 per cent on Singaporeans, many may have thought twice about buying a second or subsequent property as the additional monies to be paid are considerable.

Much of the ABSD assessed came from share transfer from bulk purchases by non-Singaporean entities or shareholders who may have to let go of unsold units before they are hit by the Qualifying Certificate (QC).

marinacollectionBut with the current financial and economic climate hazy at best, the future of other investment products fairly volatile, and local property prices having fallen to affordable quantum levels, could more buyers be picking off units to secure more stable future yields?