The keynote panel discussion on the first day of the SMART Expo was on the Singapore property market. The title was “Building a Sound Investment Strategy for a Changing Singapore Property Market” and the three panelists were:
The facilitator of the panel discussion was Mohamed Ismail, CEO of PropNex and a very dynamic speaker. Property still seemed to be a hot theme as the event was packed with a full house. Here’s a summarised transcript on what they talked about:
With the current changing economy and market sentiment in Singapore, how should buyers react?
Alfred: The fundamentals of Singapore has not changed. But we are not immune to global changes and people have become more defensive. It is best to look for assets that produce yields.
Ismail: Eight months ago, it’s not a buyers market. Sellers call the shots. Now, it’s a buyers market. Sellers are not desperate, but they are more realistic.
Raymond: When good times comes, a lot of owners also become greedy. A lot of good things are happening in Singapore right now. F1, integrated resorts, etc. Unfortunately, we are also affected by US subprime crisis. The speculators are the ones affected. They have to sell cheap.
What’s the emerging opportunity in Singapore for this year?
Ismail: Today, you can still pick up luxury units at 5-8% less than the peak reached less than a year ago. This is especially for units with deferred payment scheme.
Alfred: You can look at fringe location luxury units that are slightly older and are still lagging behind. A lot of these properties have to be absorbed first before we move into the mid-tier market.
Raymond: Two major locations are the Marina Bay area and Sentosa.
Ismail: There’s a limit to the amount of properties in the core area. Moving outside, anything this is central location will benefit. However, do not be so bold as to speculate. You must have the credit ability to finance and look at mid to long term.
What are your views on mass market that are further out?
Alfred: It’s all a function of affordability. If they have good anmenities and transport hub, they should do well. I prefer the fringe area. You also have to differentiate whether a property is for consumption or for investment.
Ismail: If the place is less than 5 minute walk to MRT and you can get there without sweating, it’s a good buy. The mass market will continue to move as there is a difference between the prices of resale market and new developments. However, foreigners will not come in to push the price.
Raymond: One thing you can do is to go to URA center and check out what’s happening in Singapore. Or go to www.ura.gov.sg.
What about landed property?
Raymond: It’s again about demand and supply. There’s a limit of supply. Lifestyle has improved tremendously.
Ismail: If you buy now, you will make money in 8-10 years. Landed property is a scarce commodity in Singapore. The price is very low compared to condominiums. One reason why they have not moved much is because there are not many transactions done. Valuation is actually very simple to do. The valuer will just consider the average prices of recent transactions and the market sentiment.
Overall, I get the impression that the three of them are still pretty bullish about the Singapore property market.