AN INDEPENDENT PERSPective


 It's so important to be true to yourself            "
khaliladis.com
  • Home
  • About
  • Books
  • Services
  • Media
  • Events
  • Blog
  • Awards/Accolades
  • Clients
  • Portfolio
  • Contact
  • Corporate Responsibility

Singapore property market outlook and predictions for 2020

11/18/2019

1 Comment

 
Here are our top five predictions as the Lion City braces for slower economic growth and the possibility of a recession next year.

​By Khalil Adis
Picture
The vibrant entertainment enclave of Clarke Quay in Singapore. Photo: Khalil Adis Consultancy.
Singapore had narrowly missed a technical recession in the third quarter of 2013 growing by 0.1 per cent on a year-on-year basis according to advance estimates from the Ministry of Trade and Industry (MTI).

Still, the economy remains muted as the labour market continues to soften while retrenchments are on the rise.

We are already seeing firms asking employees to take a shorter workweek, particularly in the manufacturing sector as this is most affected by the ongoing global headwinds.

Given the trade war will likely persist in 2020 combined with a bleak job market ahead, here are the possible impacts on Singapore’s property market.

#1: High-end properties will likely take the first hit
Picture
Tourists seen on Orchard Road, Singapore shopping district. Photo: Khalil Adis Consultancy.
High-end properties are those that are located in Districts 1, 2, 9, 10 and 11.

These properties are first to take the hit should a recession occur next year as they are the most volatile - they are the first to rebound during an upturn but also the first to see the largest decline in capital values.

Why is this so?

This is because this market segment is driven generally by speculators and foreign investors.

As the economy takes a hit, they are likely to offload the properties once they are unable to finance their mortgage or secure tenants.

During the 2008 crisis, for instance, we saw properties in prime areas declining by as much as 30 per cent.

Also, the cooling measures that were announced last year will likely see such buyers staying away from this market.

The only exception is the ultra-high-net-worth individuals as seen in the penthouse unit at Wallich Residence that was purchase by British billionaire James Dyson in April this year.

However, such buyers are far and few between.

#2: Vacancy rates for high-end units will likely increase
Picture
Condominium units located in Singapore's CBD area. Photo: Khalil Adis Consultancy.
The soft job market and increase in retrenchments will see expatriates either being repatriated or a cut in their housing allowance.

As such tenants generally favour renting homes in the prime areas, we are likely to see vacancy rates increase as they exit from the market or opt for cheaper housing options in the city fringe and heartland areas of Singapore.

With an increase in vacancy rates, this will likely trigger a price war among landlords as they reduce their asking price in the hope of securing a tenant.

As a result, rentals in the prime areas will likely decline as well.

Again, this was seen during the 2008 crisis.

#3: Mass market segment will be resilient
Picture
An aerial view of Skies Miltonia located in Yishun. Photo: Khalil Adis Consultancy.
Mass market homes are those that are located in the Outside Central Region (0CR) as defined by the Urban Redevelopment Authority (URA).

Why are such homes more resilient compared to those located in the Core Central Region (CCR) and Rest of Central Region (RCR)?

This is because the OCR is driven by genuine homebuyers and where the rentals are more affordable.

While we will likely see a price decline in the secondary market due, it will not be as much as the prime areas.

For instance, during the 2008 crisis, prices in the OCR declined by around 10 to 15 per cent.

#4: Flight to safety in the mass market rental segment
Picture
Condominiums located in Bishan. Photo: Khalil Adis Consultancy.
Having said that, the mass market segment is not immune to the economic slowdown and soft labour market.

We are already seeing workers being retrenched or told to take a pay cut, particularly among those in the manufacturing sector.

As the manufacturing sector takes a hit, so will the rental market.

However, this market is still considered relatively affordable for the expatriate worker albeit with a reduced budget.

Therefore, this market will see a flight to safety among the white-collar workers who do not mind living in the heartlands.

Landlords will also likely to lower their asking price in a bid to continue attracting tenants.

#5: Affordable homes will be in demand
Picture
An artist impression of Plantation Village in Tengah, a BTO project that was launched by the HDB in November 2019. Image: HDB.
​The property market is very much sentiment-driven.

However, the affordable home segment is different as it is driven by buyers who genuinely need a roof over their heads.

As such, the HDB market will see good take-up rates particularly for homes that are being offered under the Build-To-Order (BTO) and Sale of Balance Flats (SBF) exercises.

In November, for instance, the HDB launched 4,571 BTO units and 3,599 SBF units. 

The BTO units are located in Tengah, Tampines and Ang Mo Kio while the SBF units are located in both mature and non-mature estates.

The Enhanced CPF Housing Grant (EHG) of up to $80,000 that was announced in September this year will provide a much-needed help for homebuyers in acquiring their first home and ease their property journey.
1 Comment
Missouri TS Hookups link
12/24/2022 04:38:52 pm

Thiis is a great post

Reply



Leave a Reply.

    Khalil Adis

    An independent analysis from yours truly

    Archives

    August 2022
    July 2022
    April 2022
    March 2022
    January 2022
    November 2021
    October 2021
    September 2021
    June 2021
    April 2021
    March 2021
    January 2021
    December 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    March 2018
    February 2018
    January 2018
    December 2017
    September 2017
    July 2017
    June 2017
    December 2016

    Categories

    All
    121 Residences
    ABSD
    Affordable Homes
    Airbnb
    Allianz Real Estate
    Ang Mo Kio
    Astaka
    Astaka Holdings Limited
    Avenue South Residence
    Aviation Park
    Bandar Malaysia
    Bank Negara Malaysia
    Bayan Lepas LRT Line
    Bedok
    Below Market Value Property
    Branded Residences
    Bright Hill
    BTO Flats
    Budget 2019
    Budget 2020
    Bukit Chagar
    Bukit Panjang
    Cagamas Berhad
    Cairnhill 16
    Causeway Point
    Cheonggyecheon
    Chinatown Kuala Lumpur
    Circle Line
    City Plaza
    Cochrane MRT Station
    COVID19
    CPF
    Cross Island Line
    Defu
    En-bloc
    Energy Saving Tips
    Estate Planning
    Excelsior International School
    Family Violence
    First Home
    Foon Yew High School
    Forest City
    Geylang Serai
    Geylang Serai Bazaar
    GlaxoSmithKline
    Glomac Berhad
    Government Land Sales (GLS) Programme
    Greater Southern Waterfront
    HDB
    Health City Novena
    Heng Swee Keat
    High Speed Rail
    Home Mortgage
    Home Ownership Campaign 2019
    Home Renovation
    Home Rental
    Hougang
    Ibrahim International District
    IKEA Cheras
    Imperial Jade Residenz
    Interior Design
    Iskandar Halal Park
    Iskandar Malaysia
    Iskandar Regional Development Authority
    JB Food Trail
    JB-Woodlands RTS Link
    Johor Bahru
    Johor Bahru City Council
    Johor Bahru City Square
    Johor Property
    Johor Real Estate
    Joint Tenancy
    Joo Chiat Complex
    JPPH
    Jurong Lake District
    Jurong Regional Line
    Jurong West
    Keppel REIT
    Khaw Boon Wan
    KLCC
    KOMTAR JBCC
    KTM Terminal Skypark
    Kuala Lumpur Property
    Kuala Lumpur Real Estate
    Land Transport Authority
    LED Lighting
    Lim Guan Eng
    London Property Market
    London Real Estate
    Loyang
    LRT Bandar Utama-Klang Line (Klang Valley LRT Line 3)
    Malaysia Property
    Malaysia Real Estate
    Masterskill University College Of Health Sciences
    Media Interview
    Melaka Property
    Melaka Real Estate
    Menara Maybank
    Merdeka Generation Package
    Ministry Of Finance Malaysia
    Ministry Of Social And Family Development
    MM2H
    Mutiara Rini Sdn Bhd
    MyTOWN Shopping Centre
    National Day Rally 2019
    Negeri Sembilan Property
    Negeri Sembilan Real Estate
    Novena
    Ocean Financial Centre
    One Bukit Senyum
    One Cochrane
    Overleveraging
    Oxley Towers Kuala Lumpur City Centre
    P2P Funding
    Pan Island Link
    Park Nova
    Park Place Residences At PLQ
    Pasar Karat
    Pasar Seni MRT Station
    Pasir Gudang
    Pasir Gudang Hospital
    Pasir Ris
    Pasir Ris East
    Paya Lebar Central
    Paya Lebar Quarter
    Paya Lebar Square
    Penang Property
    Penang Real Estate
    Penang Transport Master Plan
    Pengerang Rapid Project
    Persada Johor
    Petaling Street
    Plaza Rakyat LRT Station
    PLP Architecture
    PLQ Mall
    PR1MA
    PTPTN
    Public Relations
    Punggol
    Punggol Digital District
    Rapid Transit System (RTS) Link
    Renovation
    Selangor Property
    Selangor Real Estate
    Sengkang
    Serangoon North
    Seri Alam Properties Sdn Bhd
    Singapore Budget 2019
    Singapore Budget 2020
    Singapore Economy
    Singapore General Election
    Singapore Luxury Property Market
    Singapore Office Market
    Singapore Property
    Singapore Property Market
    Singapore Real Estate
    Singapore Retrenchments
    SME Co-Investment Fund III
    Sri Geylang Serai
    Suasana Iskandar Malaysia
    Sungai Buloh Kajang Line
    Sungai Buloh - Kajang Line (SBK Line)
    Sungai Buloh Serdang Putrajaya Line
    Tampines
    Tampines North
    Tanjong Katong Complex
    Tavistock
    Teck Ghee
    The Workers' Party
    Thomson East Coast Line
    Thomson-East Coast Line
    Thomson-East Coast MRT Line
    Tokyo Property Market
    Tokyo Real Estate
    Transit Oriented Development
    TREC
    TriTower Residence
    Tun Razak Exchange
    UM Land
    Universiti Kuala Lumpur
    Universiti Teknologi Mara
    URA Draft Master Plan 2014
    URA Draft Master Plan 2019
    Urban Redevelopment Authority
    US-China Trade War
    Vivian Balakrishnan
    Waterway Point
    Wisma Geylang Serai
    Woodland Regional Centre
    Woodlands Central
    Woodlands North Coast
    Woodlands North MRT Station
    Woodlands Regional Centre
    Yishun
    Y Waterway@Punggol

    RSS Feed

Picture

100 Peck Seah Street
#08-14
PS 100
Singapore (0793333)
Email: ACCOUNTS@KHALILADIS.COM
Phone: +65 8201 9254

What the market is saying

"Hi thank you so much. Keep updating." - Sharveena

"I bought your new book through Popular Bookfest in KLCC yesterday. I just finished my reading. I like it so much as it saved my time to search those information that I have been looking for it. Thank you for writing this book. I believed you have spent a lot of time to prepare it". - PY Chan

Want more bite-sized news?

    Subscribe Today!

Submit
  • Home
  • About
  • Books
  • Services
  • Media
  • Events
  • Blog
  • Awards/Accolades
  • Clients
  • Portfolio
  • Contact
  • Corporate Responsibility