Analysts expect another good year for private home prices

Analysts expect another good year for private home prices in 2013 with stimulating interest rates, robust developers' balance sheet and continuing increase in land cost. Some analyst is expecting in general an increase of as much as 10% on the back of escalating land cost.

The greatest beneficiary is the mass-market condo and apartment sector, where it is expected to rise from 10 to 15%. The high end non-landed property will continue its recovery to about 3 to 5% overtaking the last peak achieved in 2007 as the prices in this sector remain to be lower than Hong Kong.

The new homes sales hit a new benchmark with 19,792 units sold from Jan to Oct 2012 which is much higher than the whole year in 2010 which was at 16,292 units.

Executive condominiums have also made an unprecedented sales recod with more than 4000 units sold in 2012 underpin by a correspondingly price increase. Demand is expected to enjoy another good year in 2013.

As fewer compact apartments were built in 2012, the share of new home sales in this sector is correspondingly lower in 2012.

Ample liquidity due to quantum easing initiated by the US with the accompanying SGD currency gain and the benignly low interest rate will support the growth of property demand in Singapore.

Analysts expect 16,000 to 18,000 new homes to be sold in 2013.

17 Dec 2012