According to The Straits Times, new home sales in Singapore in the first half of 2011 fell almost 50% compared to the first half sales of 2010. In the first six months of 2011, 3796 new homes with total transaction price of 5.1 billion SGD are sold while in the first 6 months of 2010, home new sales numbers were 7,189 with the total transaction price tag of 12.3 billion SGD. [1]
"Not only has there been a plunge in the number of new private homes sold, but the total value of sales has also more than halved, according to a new report by property consultancy CB Richard Ellis (CBRE).
Experts attribute this to weaker market sentiment this year, as well as the cooling measures in January, which were the strictest seen in the past few years."
Source : New home sales plunge by half
According to another The Straits Times article, "new private home sales fell 13 per cent to 1,575 units last month."[2]
In my opinion, although sales numbers fall, it is early to talk about price falls. This is because the developers had great 2 years in 2009 and 2010 and they have holding power. Also the effects of super low interest rates on the supply side is mostly ignored. Yes, super low interest rates increases demand by making prices "normally" unaffordable "look" affordable. But it probably enables developers to finance their operations with cheap debt instead of selling units with discounted prices and gives them more holding power. This is the reason although there are thousands of unsold new homes in their portfolio (obvious sign of unaffordable prices) they do not feel urge to reduce prices. An interest rate hike and persistent low sales volumes may trigger them to discount but it is early to talk about both of these.
[1] - Sales Down
[2] - New private home sales fall 13%
Related Article:
"Not only has there been a plunge in the number of new private homes sold, but the total value of sales has also more than halved, according to a new report by property consultancy CB Richard Ellis (CBRE).
Experts attribute this to weaker market sentiment this year, as well as the cooling measures in January, which were the strictest seen in the past few years."
Source : New home sales plunge by half
According to another The Straits Times article, "new private home sales fell 13 per cent to 1,575 units last month."[2]
In my opinion, although sales numbers fall, it is early to talk about price falls. This is because the developers had great 2 years in 2009 and 2010 and they have holding power. Also the effects of super low interest rates on the supply side is mostly ignored. Yes, super low interest rates increases demand by making prices "normally" unaffordable "look" affordable. But it probably enables developers to finance their operations with cheap debt instead of selling units with discounted prices and gives them more holding power. This is the reason although there are thousands of unsold new homes in their portfolio (obvious sign of unaffordable prices) they do not feel urge to reduce prices. An interest rate hike and persistent low sales volumes may trigger them to discount but it is early to talk about both of these.
[1] - Sales Down
[2] - New private home sales fall 13%
Related Article:
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