Singapore property market downturn : Q3 2008 private home prices down 2.4% from Q2

This article belongs to the Singapore property market story arc.

channelnewsasia.com :

Private home prices in Singapore came in weaker than expected in the third quarter of 2008, dropping by 2.4% - worse than an earlier estimate of 1.8%. The quarter-on-quarter drop was the first decline in more than 4 years. URA data showed that prices fell across the board, with prices for high-end homes in prime areas seeing the biggest drop of 2.7%. Analysts said there has not been panic selling yet, but they expect prices to drop by about 3-5% in the quarters to come.

Donald Han, managing director of Cushman & Wakefield, said: "There will be people who've been affected by the stock market (declines), who might be late in their payment, and that might eventually translate to more pressurised selling." Prices for mass-market homes fell by 1.5%, while the mid-tier segment declined by 2.4%. URA said there are over 66,000 units of private homes in the pipeline. Some property consultants said developers may choose to launch their projects before the market gets worse. Rentals of private residential properties also fell in Q3 2008, dropping by about 1%.

- Once again, word on the street is way ahead of the mainstream media. Forummers have talked about price declines of 50% already happening, with Singapore condo prices in prime locations dropping by more than half from the heady heights of $2400 per square foot to $1000 per square foot. A rather more affluent "person of means" has reported being overwhelmed by calls and SMS messages from property agents hoping to unload their properties onto him - he says his standard reply to them is to lower the price by another 50%, "and then we'll talk".

And this is just the beginning. We're looking at a trend reversal here, and with this announcement, the Singapore property market downturn is now official. The Singapore housing market tends to lag the US market by around 6 months to a year, and that's roughly the same for the general economy. Follow the leader, that's what we do. Watch for a general economic contraction, more layoffs, and further property market declines to hit in 2009. "Interesting times" indeed.

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