STOCKS NEWS SINGAPORE-Private home rents may fall by up to 5 pct - DTZ
Property consultant DTZ expects rents of Singapore's private residential units to fall by up to 5 percent this year compared with a slight rise in 2012 due to a large oncoming supply of new flats and slowing population growth.
Singapore's home prices and rents have remained firm despite government efforts to cool its red hot housing market, buoyed by strong investor interest as a result of low interest rates and a tight labour market.
DTZ estimates that around an average of 19,225 private homes will be completed per year from 2012-2016, sharply higher than an annual average of 9,136 units in the previous 10 years. The bulk of the new supply will also be in the suburbs, which will create more pressure in those areas, the property consultant noted.
"This increase in supply will also be exacerbated by slower growth in the non-resident population as a result of government measures to tighten foreign labour. Vacancy rates have already been rising and as a result of the supply, we expect rents could fall," said DTZ's associate director of research, Lee Lay Keng.
She expects private home prices to remain flat or rise by up to 2 percent this year. Based on the government's preliminary estimates, prices of private homes grew by about 2.8 percent in 2012.
"Even with six rounds of cooling measures, purchasers' demand tends to bounce back after two to three months. Low interest rates and high employment will continue to support demand," Lee said at DTZ's property seminar.
As a result, Lee said more government measures could come that may include restrictions on renting out public housing units, raising down payments for buyers purchasing their second or subsequent homes.
Singapore's largest residential developers include CapitaLand Ltd and City Developments Ltd, whose shares have outperformed the broader market in 2012. 1348 (0548 GMT)
- Tweet this
- Share this
- Digg this
- Ukraine forces kill up to five rebels, Russia starts drill near border |
- Jodie Foster marries girlfriend Alexandra Hedison
- Boy and girl on Korean ferry drowned with life jackets tied together |
- Barclays chairman defends staff bonuses as Standard Life leads shareholder protests
- Australia rules out link between debris and Malaysian plane