Only 11 new housing projects anticipated for 2022: PropertyGuru
But the outlook for the property sector remains positive for the coming year.
PropertyGuru revealed its annual Singapore Property Market Outlook 2022 report showing the property sector has displayed incredible resilience in the face of the pandemic.
However, the sector may need to contend with developing macroeconomic and property supply trends in 2022.
Here are the key highlights from the report:
Rising property prices to persist into 2022
- Tightened COVID-19 safety measures had a limited impact on the appetite for residential property, with prices rising for the sixth consecutive quarter.
- The sustained growth over the past 1.5 years is likely to persist into the new year, albeit at a slower pace.
- Notably, 2022 will see another estimated 31,000 HDB flats coming off their Minimum Occupation Period (MOP).
- Property demand will continue to be driven by HDB upgraders and wealthy Singaporeans, as well as foreign buyers as more Vaccinated Travel Lanes (VTLs) continue to roll out as planned.
Private housing supply to drop further; only 11 new projects anticipated in 2022
- The private home supply is tapering against a conservative supply under the Government Land Sales (GLS) programme.
- Hence, there was a slight buzz in the collective sales scene. As of Q3 2021, about 25 new en bloc sites were put up for tender, compared to only 11 last year. How many are eventually sold will determine the supply for the next few years.
- The private property market expects to see only about 11 new projects in 2022, with eight, including two executive condominiums, located in the Outside Central Region (OCR).
- There are three mega-developments with large land sites to look forward to, including the ones at Marina View, Jalan Anak Bukit and Lentor Central. They are large integrated developments with residential and retail units, typically popular amongst home buyers.
Mortgage rates are expected to remain in the buyers’ favour
- Access to affordable credit has no doubt contributed to the booming property market.
- While a sudden spike in interest rates in 2022 is unlikely, rising global interest rates will inevitably result in a gradual increase in Singapore mortgage rates.
- Homeowners are advised to be cautious about taking on significant new debts and pay notice to the changing economic scenarios that are playing out.
Potential implementation of wealth tax
- There have been discussions around wealth taxes in response to observations of a growing disparity in wealth.
- The Government has said that they agree to wealth tax in principle. If a wealth tax is imposed, we expect it to occur in 2022 or 2023.
- The current challenge is how to impose the tax over a range of assets, including property, and how to drive it fairly and equitably.