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Subdued home buyer appetite in Singapore: Survey

Caroline Ng | Aug. 21, 2013
Almost three in four Singaporeans are putting off purchase decisions due to affordability concerns, according to Asia Property Market Sentiment Report.

The level of government support, however, appears to be the key difference between popular Iskandar in Malaysia and Makati.

"Iskandar is heavily supported by the Malaysian government. Makati has not got that sort of support from the government, at this point, to develop it into a residential hub," said Tan.

However, safety and security are key concerns for Singaporeans when investing overseas. Seventy-five percent view crime and safety as an area "for improvement".

Bullish asset value sentiments
Despite the huge influx of new properties this year and next, many home owners (59 percent) are confident prices will not decline.

Parallel to buyers' strong asset value sentiment, developers are also willing to fork out record high bidding prices for land.

"A lot of developers are super confident for the price they are paying for right now," said Tan.

"There is a sense that they don't really care where prices are at this point, just the fact that the population is going to increase and land is scarce, that is good enough for them to go in."

Despite a series of aggressive cooling measures that have dampened property sales, prices have remained consistently high.

Getty Goh, director of Ascendant Assets, attributed such sticky prices to current seller psychology where people are unwilling to exit the market considering the opportunity costs of difficulties to re-enter the market in the future.

In the event of a price decline, HDB is seen as most vulnerable - 28 percent of the respondents said the prices will drop; followed by non-landed luxury (23 percent); resale private condos (17 percent); new private condos (13 percent) and landed luxury (12 percent).

Condo dreams alive
Close to seven in 10 respondents (68 percent) chose private condominiums as desired property over 35 percent for HDB flats and 16 percent for terrace houses.

Attractive yields from mass-market condominiums continue to lure HDB upgraders (68 percent). While landed home prices have only risen by four percent in the past year, mass-market condominiums have risen 10 percent in the same period.

The survey is conducted on 28,000 respondents across Singapore, Malaysia, Indonesia and Hong Kong, aged 26-50. The Singapore report is based on 2,825 local participants.



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