Singapore’s residential property prices are likely to remain flattish, supported by low vacancy and strong affordibility in the wake of the city state’s seventh round of cooling measures, a report by Credit Suisse said.
The research house said it expected a further 5%-10% downside risk for the prime (high-end) end due to the vacancy, mitigated by mild increase in the mass and mid-market.
The Singapore government introduced the seventh round of cooling measures about a week ago which takes effect on Jan 12 this year to ensure housing remained affordable to Singaporeans.
The report said that with Singapore’s low interest-rate environment here to stay, a lack of attractive investment and the anticipated growth in household income driven by the tight labour market with unemployment at 1.9%, property could continue to be one of the key investment products.
The report also highlighted that higher construction costs and rising land costs could translate into an upward risk for prices.
The report said the government would manage supply “to avoid significant oversupply” as well as price to “balance affordability”.