In the second quarter of 2023, developer sentiment in the premier residential market shifted negative

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Based on research conducted by the National University of Singapore (NUS) Real Estate in the 2Q2023 survey of sentiment released on August 30th, a slowdown in worldwide economic activity is the most significant worry for senior executives in Singapore’s real estate development and construction sector. This was listed as the top threat from 92.5% of the respondents who were polled.

The slowdown in the Chinese economy is another significant impact on consumer and investor confidence, considering the fact that China is Singapore’s biggest exporter, representing more than 15% of the country’s non-oil exports in 2022, as per Institute of Real Estate and Urban Studies Director Prof. Qian Wenlan.

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Of the respondents, 72.5% indicated rising inflation and interest rates as a significant risk issue.

The government intervention to temper the market was ranked 3rd with sixty% for 2Q2023, a rise of just a bit in comparison to 54.5% in 1Q2023.

The impact of two round of property cooling measures that were implemented in the months of September 2022 and April 2023 are being felt. According to the survey, the main residential market was the most negatively affected in 2Q2023, and had negative net balance of 40%.

“Foreign buyers are the main source of significant demand for premium properties in the country,” said Qian. “The low performance of the high-end residential properties during the 2nd quarter may be attributable to foreign buyers currently paying a substantial 60% ABSD (additional buyer’s stamp duty] in order to buy any residence. property.”

The residential market in suburban areas however, was quite resilient, registering an unfavorable net balance of just 8%. “Among other reasons, the sluggish demand due to delays in construction in Covid continues to fuel sales among real homebuyers,” said Qian.

In 2Q2023 in 2Q2023 45% of developers were expecting an average or significantly greater number of units to be introduced within the coming six months. A little over fifty% of developers mentioned financing as their main concern in 2Q2023, which is an increase over 35.3% in the previous quarter.