Seems like a doomsday situation right? Stock market dropped so much! Retrenchment worries, sales and profit numbers dropped drastically! Siao liao! Property market how? Any fire sales or lelong? We receive enquiries like this quite often in the past few weeks. Let us logically navigate through these tough times.
Government intervention
This is just our personal opinion but our Singapore government had moved fast and decisive to help citizens save their jobs deploying Jobs support scheme and extending it.Solidarity payout will help us tide over daily needs and spending and other self employed schemes that we will not go into detail about. Not to mention deferred payment for property mortgages, insurance payments, car loan payments, etc.
My point is if the people’s needs are well taken care of, they are LESS LIKELY to prematurely liquidate their property assets which in turn reduce the fire sales.
The fact is sales of new home sales nose-dived, but which industry is not affected in Covid-19 period? None of them are spared. Even HDB resales numbers dropped drastically.
BUT, there are no cheap sale lelong at the moment. In fact, there are people buying new homes through virtual viewings, zoom meetings, money transferred and deal done.
Key points of the Business Times article on 27th May 2020
➕Wealthy Chinese snapping up luxury homes to guard their wealth against inflation & weakening yuan.
➕In Singapore, the latest trend shows that buyers are more receptive and can transact multi-million dollar deals through virtual tours and photos
➕Singapore is regarded as a safe haven for property investments – stable and well-regulated market
April 2020 New launch sales
Really or not? Have people buying without seeing showflat in person? Yes. This is partial data only, we have collated the top selling projects in April
Something for you to think about (tap here)
- Will the COVID-19 remain for many years and bankrupt all the economies of the world?
- If during COVID times, developers are still selling just by using virtual tours and zoom, do you think sales will improve or drop even more when COVID is lifted?
- If sales will improve after COVID lifted, do you think prices will go up or down?
- Will sales and prices remain low forever? Check SARS time property prices and after.
We are not fortune tellers, there’s no one that can tell accurately how COVID-19 will play out. How much prices going to fluctuate or will there be a crash. What we can do is to use the facts to best-guess the direction going forward.
Our “prediction” based on facts (tap here)
- Government help in many ways to help Singaporeans keep jobs, defer payments and some money to tide over tough times. Banks approve 90% of 31,300 mortgage deferment applications. This in turn prevents borrowers from encountering repayment difficulties, and the effect is stabilized resale home prices. In short, “Lelong” will be kept at a minimum when people can have better holding power therefore won’t be desperate to sell, thus WILL NOT drive down the prices drastically.
- COVID-19 will end eventually and prices will gradually go upward just like SARS, Global financial crisis. When will it go up and how high it would go, we cannot predict, but analyzing the property cycle chart, the property price index will always surpass previous highs. Property investment should always take a long-term approach.
- Prices will hold if buyers are steadily buying. Put yourself in the developer’s shoes, if i can sell in these tough times, why should i give more discount and drop my profit?
All the information above are of our personal opinion. If you feel that you need more information, whether you’re thinking of buying a property or selling, feel free to drop us a msg.
What we’d suggest you can do in this downtime, make use of the available free time, discuss with family how you’d like to do going forward and come to a consensus. Different families have different needs, some are looking to expand while others are looking to right-size to a smaller home. If you’re young (under 50 y.o) there will be at least 1 more chance in the property cycle for you to profit from. Check your home valuation here. Or learn how to calculate your potential profits in this post here.
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Get in touch with us, we at PropertyDiscovery would be more than happy to help you through this stressful phase. Feel free to contact us using the Whatsapp button below, or using the traditional form below.
