Singapore Property Buyers’ Top 5 Questions Answered
With the abundance of new private residential property launches, and the large number of HDB flats reaching their 5 year minimum occupation period (MOP), the Singapore property market is currently a buyer’s market. With all the housing options available in both the public and private housing markets, everyone could potentially be a property buyer or seller.
We ask Christine Sun, the Head of Research and Consultancy at OrangeTee & Tie, all of your most pressing property questions.
1. Let’s talk about the recent changes to the HDB grants and the CPF loan rules announced a few months earlier. How does it impact the HDB resale market and the BTO market?
The new policy changes are likely to help the HDB resale market further. The recent CPF changes have already seen early success where demand for older flats has increased in the second quarter of this year. These new changes may help the market further by stimulating more demand for resale flats and prices may even improve for some flats.
The changes have come in quite timely as there is an increasing supply of resale flats entering the market owing to more flats reaching their five-year MOP in recent months. Therefore, the increased demand may likely help absorb some of the flat supply.
The higher income ceiling may also see more buyers being able to afford BTO flats that are larger or those located in mature estates. This could also support the government’s move to build more flats in the Greater Southern Waterfront, where more people may be able to afford these flats, which are likely to be priced higher than the other usual BTO flats.
The increased demand may see prices of some resale flats rise over time. BTO prices have largely been kept stable by the government so the impact could be limited.
2. What about its impact on the private property market?
The increased income ceiling for EC purchases may see more people entering the EC market. More Singaporeans will be able to achieve their upgrading dream to a private home.
This also comes quite timely as a few EC projects are slated to be launched for sales next year (these land parcels are already sold) and the increased demand will help to absorb the upcoming supply.
With more demand for HDB resale flats, we may also see more HDB owners being able to upgrade to a private condominium.
3. There have been a number of popular new launches, for both private condominiums condos and executive condominiums. What is drawing buyers to these projects?
The following is a list of projects that have been launched and sold within the last three years. The take-up rate for many of the large-sized projects is healthy, and many have sold more than 30 per cent of their entire development within 3 years of launch, with some taking only 1 to 2 years to achieve the sales take-up. Therefore underlying demand for new private homes is still strong.
Many of these projects are well located, have distinctive features, built by reputed developers or have unique selling points like seaview, river view, ample facilities, etc.
4. Which upcoming launches should potential buyers look at next?
There are a few outstanding projects coming up such as Dairy Farm Residences, Gucco Midtown, Royalgreen, and Van Holland. Most of these sites are built by reputed developers, situated at prime locations and are equipped with quality finishings.
5. What is the Singapore property market’s outlook for the next 1 to 5 years and what major events could impact it?
The new supply of private homes is poised to fall in two years’ time as the collective sales market has effectively ground to a halt and supply from government land sales programmes has also fallen. Most mega projects have already been launched from the last collective sales cycle, so we can expect very few mega-sites to be launched moving forward. The shortage of supply and limited competition may provide some respite to existing developments to clear their balance stock in the next two years. The decreasing new supply of private homes may also present some upward pressure on the prices of private homes in a few years’ time.
One key impact could be the full unveiling of the masterplan for the Greater Southern Waterfront and Punggol. We may expect properties around these regions to be significantly affected as construction and development works are slated to begin in the next few years. When completed, we may expect a positive impact on the housing demand and prices of homes in these areas.