Residential property prices in the wealthy island nation of Singapore could
be headed for a correction of up to 20 percent by 2015, according to
Barclays.
This is due to the effect of all the combined measures of the government ranging from 60% TDSR to the ABSD and all associated taxes for buying and selling of the residential units. Added to this is the large amount of supply coming up to 2014 and 2015. Short Term interest rate is expected to rise and Barclay expects that it will rise by 200 basis points over six months. Singapore mortgage rates are normally pegged to the short term 3 months Sibor rate (Singapore Interbank Offered Rate).
The bank forecasts that prices will remain flat in 2013, before falling 5 percent
in 2014 and another 5-15 percent in 2015.
(Read more: Are Singapore home prices about to ease, finally ?)
Almost 95,000 private units are expected to come on stream over the next five years, alongside 25,000-27,000 public housing flats per annum, according to the Urban Redevelopment Authority.
Total housing supply averages 40,000 units per year and may peak at 47,000 in 2015. This will be above the historical average annual supply of 12,300 units. Assuming occupier demand of 15,500 units of private housing per annum, it is expected the private vacancy rate to rise from 5.6 percent to 9.9 percent in 2016. Recent data showed some signs of slowing: developers typically sold 1000 - 1500 units compared to 742 units sold in August in the same period.
Source: Yahoo
This is due to the effect of all the combined measures of the government ranging from 60% TDSR to the ABSD and all associated taxes for buying and selling of the residential units. Added to this is the large amount of supply coming up to 2014 and 2015. Short Term interest rate is expected to rise and Barclay expects that it will rise by 200 basis points over six months. Singapore mortgage rates are normally pegged to the short term 3 months Sibor rate (Singapore Interbank Offered Rate).
(Read more: Are Singapore home prices about to ease, finally ?)
Almost 95,000 private units are expected to come on stream over the next five years, alongside 25,000-27,000 public housing flats per annum, according to the Urban Redevelopment Authority.
Total housing supply averages 40,000 units per year and may peak at 47,000 in 2015. This will be above the historical average annual supply of 12,300 units. Assuming occupier demand of 15,500 units of private housing per annum, it is expected the private vacancy rate to rise from 5.6 percent to 9.9 percent in 2016. Recent data showed some signs of slowing: developers typically sold 1000 - 1500 units compared to 742 units sold in August in the same period.
Source: Yahoo
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