How great, just before I can finish my trilogy, the cooling measure come up. I was going to write about some kind clamp down on industrial sale and I guess it’s not necessary anymore.
Just sharing some thoughts on the latest cooling measures. I have yet to properly digest them but I just do not agree on the stamp duty levied on the second property purchased for Singaporeans. In my geek jargon, One of the Singaporeans’ aspirations had been nerfed.
Will the property market crash in the next few months?
Unlikely…but prices should drop for the Residential and Industrial. Cooling measures are like shackles, they can be removed easily if prices free fall…remember, it is not in the Government’s interest to crash the property market! They want a sustainable growth which is not fueled by the globally low interest rate and the smart money flowing into Singapore.
By how much? Your guess is as good as mine.
One thing for sure, most showrooms should be still open even at this timing…
Residential
The demand will definitely goes down…but so will the supply. People with more than one property will not be selling their unless they really need the money. With the last cooling measure, investors are already prepared to hold on to their properties for 4 years or more. With the lower Loan To Value previously, any drop (which I feel will be temporary) in the price will not push the owners to dispose their properties hence steadying the prices.
Will the banks ask owners to top up if the price do drop? If they do (and it is a BIG if), it will be the minority of the minority…
Who will be hit the hardest? All the developers of new private property launches.
I am going to sell all my property related stocks on Monday…
Industrial
This is long overdue. However it will not hurt the real industrialists who are purchasing the units for genuine use. This will be fodder for my last part of the trilogy…
Commercial
Nothing for this sector…yet. However I will be advising my investor clients to buy as soon as possible…
Then again, there is a limited supply of strata titled units available in the first place…
Stocks
Property counters should drop and some said the bank counters will drop too. Money have to go somewhere and I foresee investors putting their money in stocks instead of properties. For the local exchange at least, the volume should increase…perhaps time to buy SGX…
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