Here’s why there’s hope yet for Singapore property developers

New, well-located launches are key.

A sustained demand for new launches coupled with a potential for volume growth are proving to be a brief respite for beleaguered Singapore property developers.

According to DBS, upcoming launches such as the Sturdee Residences, and Jem at Toa Payoh are likely to steal the spotlight upon their launches in April 2016 and May 2016.

In addition, there is still buyer demand in the current market for well-located projects, based on DBS’ recent showflat visits to Sturdee Residences and Cairnhill Nine. In particular, there’s interest for ideally situated projects at the fringe and central region, which are attractively priced in contrast to surrounding developments.

Moreover, there’s a possibility of pickup in volume on attractive prices. The recent launches of Wandervale, Cairnhill Nine, and Wisteria showed some signs of improvement in property sentiment.

However, DBS warns of potential further price decline on back of the risk to higher market vacancy rates and interest rates in the medium term.

DBS asserts that amongst developers, City Dev is poised to be the cream of the crop should sentiment improve, especially if a potential relaxation of property policies materialises in the medium term.

CapitaLand and Frasers Centrepoint Limited are also attractive for their valuations and strategy to de-risk and pre-sell their existing unsold inventory.

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