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Singaporeans believe that Property Prices will slide

It is in the interest of Singaporeans who are aspiring to buy their first property for prices to slide as this would mean lower monthly mortgages. A survey conducted see that most Singaporeans think that prices will slide in anticipation that interest rates will increase.

A significant number (38.5 percent) of Singaporeans and Permanent Residents (PRs) polled believe home prices will fall over the next six months, according to media reports citing a survey by ERA Realty and research firm Nexus Link.

On the other hand, 35.6 percent of the respondents felt prices will remain unchanged. As for the next 12 months, 33.8 percent said prices will fall, while 39.7 percent surmised values will be flat.

Looking at the interest rates of properties, this in indeed the case as they are so many properties available in the market.

“We do not see the results as negative,” said ERA Realty’s Key Executive Officer Eugene Lim. Although the housing market is reeling from the effect of the government’s property curbs, the objective is to ensure a sustainable market rather than engineer a huge drop, he added.

On the other hand, respondents aged 21 to 34 were the only group where more people were anticipating higher prices. This shows younger buyers are somewhat unaware on market dynamics due to their limited investment experience, added Ong Kah Sen, Director at R’ST Research.

Notably, property prices had been on the uptrend since 2009, but the values of HDB flats started dropping during H2 2013, while that of private condos in Toa Payoh declined from January 2014.

Meanwhile, the poll also gauged the respondents’ awareness on the government’s property cooling measures. Based on the results, 70 percent knew at least one, while less than 20 percent were aware of all six.

In particular, the Mortgage Servicing Ratio (MSR) and the Total Debt Servicing Ratio (TDSR) were the least known.

According to Colin Tan, Suntec Real Estate Consultants’ Director of Research and Consultancy, those polled may have failed to recognise the terms, as most them know that financial institutions don’t lend as much now.

The face-to-face survey involved 500 citizens and PRs, and was carried out in September and October.

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