Cool Down On Cooling Measures

RESIDENTIAL MARKET

Redas: Cool down on cooling measures

The property sector does not need another round of cooling measures, at least not before a thorough review of the earlier measures put in place has been conducted.

This was the main message put forth by Wong Heang Fine, president of the Real Estate Developers' Association of Singapore (Redas), at the organisation's Mid-Autumn Festival yesterday.

BT had earlier reported that the latest round of quantitative easing (QE3) in the United States has raised the possibility that a fresh wave of capital flows into Singapore could cause the property market to heat up again, which, in turn, would spark off the possibility of a fresh round of government measures, or tweaks to existing policies to keep prices in check.

That being said, "if history is any guide, reaction to the residential market to QE3 in Singapore will probably take the form of a limited, short-term boost in buyer sentiment that will probably peter out before end of 2012", said Mr Wong.

A host of issues, ranging from the potential oversupply of housing in Singapore, and fears of a slowdown in the macroeconomic resulting from economic woes in both Europe and the US, continue to plague developers, said Mr Wong.

The property sector's "harvests" for the year are "somewhat uneven and somewhat calibrated", he said.

"While we see 'withering harvests' in certain segments of the residential market, crops in other sectors like the industrial market are reaping 'golden harvests'. 'Staple crops' in the commercial market have enjoyed relatively good harvests. We are also seeing 'new crops' emerging in the hospitality industry as well as 'new seeds' being sown in the Jurong Lake District for hotel developments."

According to Chia Ngiang Hong, group general manager at City Developments Limited, it is unlikely that further cooling measures will be implemented this year.

On the residential front, the month of August saw sales of private residential homes, excluding executive condominiums, fall 27 per cent to 1,421 units. This was mainly attributable to a dearth of major new project launches as developers avoided the Hungry Ghost month.

Source: Business Times – 29 September2012