It is too early to conclude whether the recent recovery in the take-up for developers’ new project launches is sustainable, Singapore’s developers body flagged on Thursday.
Clouding the outlook now are the substantial new supply coming onstream and the prospect of a prolonged period of slow economic growth.
Singapore’s economy continues to move slowly due to a confluence of global uncertainties, social and political insecurity and tension in the international arena.
The weak market will cause asset values and rentals to keep falling, create financial stress on businesses which will inadvertently affect employment.
Official data last month had shown prices and rents of private homes falling more steeply in the third quarter from a quarter earlier, with 12 consecutive quarters of decline culminating in a 10.8 per cent drop in prices and a 10.7 per cent fall in rents since the peak of Q3 2013.
This came on the back of a supply pipeline of uncompleted 43,693 private residential units, of which 20,577 units remained unsold.
Some developers also observed the market’s wobbliness. UOL deputy group CEO Liam Wee Sin noted that the performance of recent launches has been mixed. “It means if you get your product, price point and location right in the micro-market, you can create some success factor even in a sluggish market.”
Qingjian Realty general manager Li Jun noted that notwithstanding strong take-ups in recent launches, the overall number of launches this year were fewer than in previous years. He expects to see fluctuations in take-up rates for upcoming launches. Qingjian’s executive condominium (EC) project in Choa Chu Kang Avenue 5 will likely hit the market only next March or April.