Are you ready for more twists and turns on the upcoming road ahead? What does June have in store for us? Check out what Aaron has to say, on this crazy month!
The Big Month
With the big month of June upon us in 2022, there are signs and observations we see around Singapore. The roads are filled with cars, with almost everyone working out at the office again, with work from home minimised.
The property market situation during school holidays is also returning to the pre-covid norms, with many people heading overseas again for their family trips. These are signs of what's affecting the market even though there will still be transactions happening, with people that are looking to buy after renting for the last few months or having sold their own properties.
Government Land Sales
With June being the half-year mark, it's a good time to look at the second half of the year. First recent news in the press has been the government land sales. We see a mega-project coming up of 1000 over units, at $2200 psf minimum. This is combined with reserve sites and sites released by the government for the second half of the year.
What would this suggest about the upcoming supply in the pipeline?
HDB announcements
The response to Prime Location Housing (PLH) have also muted. For all its positive press and amazing points, PLH program requires one to be young with its 10 years MOP. Either that or you must be ready to commit to living out a significant number of years in this 'Prime Location'.
Your hands will also be tied in the event you are looking to change your personal situation for investment or other reasons as there will be 15 years locked in for someone that subscribes to such a program. (5 years for the property to be ready + 10 years MOP)
Thus, the muted response shouldn't come as a huge surprise.
Trends
Looking at the transactions count so far this year, it seems like the May transactions count seem to be still lower than April for condos and apartments. Of course, the data could be delayed and we might not be correct in our predictions.
But, it's key rather to understand the trends of what the data brings. It's helpful to understand whether volume drops first or price drops first?
The answer to that, is shared clearly by Aaron during his seminars.
What's Next?
3 things to note for the rest of 2022, with June being the start of it:
Projects issuing keys
GLS vs En-Bloc viability for developers
Inflation or a new norm in high prices?
In the short-term future, we see a couple of Mega-Projects issuing keys. A significant number of people are going to start moving into these projects. More and more such projects will start issuing keys in the second half of 2022.
For sites in a similar location that can be compared in relatively fair terms, GLS are easier to close than En-Bloc sites for developers. This is due to the complications involved in process, cost and other factors, such that even a marginally higher price for GLS would be viewed more positively than En-Bloc projects for developers. This is a hint regarding the upcoming moves of developers in the market.
Lastly, inflation has seen prices increase for everything. Will prices of construction, raw materials and consumables like oil and fuel eventually drop?
In times of recession, will property prices drop or are we actually seeing a new benchmark of property prices?
Some agents will suggest that prices are high and will continue to be high or even higher, with this being the 'new normal'. What would such agents suggest you do as a buyer then? Should you choose to buy such a story?
We leave it up to you, but Aaron's personal opinion on such a narrative is clear in his video.
Conclusion
Many things will turn and adjust in June.
Whether it's good or bad depends on if you are a buyer or seller. It's important to decide which story you choose to believe in. Are high property prices the new norm or will the tides change in time?
You decide.
Revealing his thoughts and observations of the market, teaching you to think the way he does: Check out Aaron's latest sharing in the video below.