JAKARTA - Sales of property units in Singapore jumped in January 2021. People have flocked to make purchases amid rumors that the Singapore government will take steps to curb the rising property market.
Quoting Bloomberg, Wednesday, February 17, data from the Urban Redevelopment Authority stated that sales of new privately built apartments jumped to 1,609 last month compared to 1,217 in December 2020. This is the biggest sales since July 2018 when 1,724 units were sold.
The Singapore property market has recovered rapidly after the COVID-19 pandemic plunged the country into its worst recession sparking speculation that authorities could step in to calm the sector. Last month, Singapore government ministers warned that they do not want the market to go ahead of economic fundamentals.
DBS Group Holdings said one of the factors driving the high demand for property is low-interest rates. House prices have risen 2.2 percent last year in Singapore.
According to this DBS analysis, a further increase of more than 5 percent would lead to a property bubble.
Christine Sun, Senior Vice President Research and Analytics at property consultancy OrangeTee & Tie said the speculation there will be property restrictions has fueled buyer concerns that their purchase eligibility or loan limits could be affected if cooling measures are issued.
"Some long-term investors are starting to act because they anticipate that it may be more difficult to own a second or third property if new cooling measures are implemented", said Christine.
The steps taken in July 2018 included raising duties on additional property purchases and tightening limits on home loans.
Even without additional restrictions, according to Christine, buyers may still be in a better position to sign off on units sooner rather than later, as house prices are likely to rise further as the global economy is predicted to pick up this year.
Singapore's economy is predicted to recover as the country takes steps to prevent the spread of COVID-19 and start vaccinations. The Singapore government is still maintaining its projected economic growth in the range of 4-6 percent this year.
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