Property prices softening fast in Singapore

This article belongs to the Singapore property market story arc.

goldclubasia.com :

After rocketing to dizzying heights last year, the private homes market has stalled because of the global credit crunch - an external factor that took the market by surprise. The withdrawal of the deferred payment scheme last year has also dampened demand somewhat. Sales volumes and interest have fizzled out just as quickly as the market surged last year. While many players hang on to the notion that strong fundamentals - low interest rates, for instance - will support the market, sentiment has fast melted away :

1 Growth in home prices weakens
2 Launches are held back
3 Collective sales have died down
4 Investor funds pull out or hold off
5 Sellers hand out discounts galore
6 Agents less sought after, ads dwindle
7 Buyers toss in low bids to test the waters

- The housing bust and credit crunch originating from the US are starting to bite here. The big news that people over here in Singapore have been pointing to : "Kuwait Finance House, which agreed last December to buy 97 Goodwood Residence units for $818.4 million from GuocoLand, allowed the purchase option to lapse."

Well. I've got a friend and fellow investor who has gone long the Singapore housing market (he bought an investment/rental apartment recently) and another who is short Singapore real estate (having sold off his condo earlier and is now renting). As for myself, I maintain a kind of neutral stance. I'm staying in my 5-room HDB flat and I'm not buying, and I'm not selling.

I await with wry amusement for my personal prediction of a certain crossover to occur : the resale price of my HDB flat dropping to or below the price at which I bought it new at the so-called "government subsidized price". So-called because it isn't that much of a subsidy and that's another long story by itself. But so far the figures are as follows : in order for this to occur, the resale price will have to drop by 25-30% from current prices. If this housing crisis continues to worsen, as it is in the US, I'd say the crossover might actually have a good chance of coming to pass.

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