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Govt curbs to weaken bungalow sales
Sunday 08 01 2012 11:52:20
Bungalow sales at Sentosa Cove are expected to fall in the coming months, in light of the 10 percent additional buyer’s stamp duty (ABSD) foreigners must bear when buying private homes in Singapore.
Sentosa Cove bungalow prices, as a result, will likely moderate, causing prices of Good Class Bungalows (GCBs) on mainland Singapore to ease, according to CBRE.
However, any price fall in both areas will be measured due to holding power of existing owners as well as the limited supply of bungalows, noted Douglas Wong, Director of Luxury Homes at CBRE.
Wong predicts GCB prices will decline by about three to five percent this year, with Sentosa Cove bungalows seeing a decline closer to five percent.
From 56 deals last year, GCB transactions will likely fall to between 40 and 45 deals, down 20 to 30 percent, he said. The value of transactions will also ease to between S$800 million and S$900 million from S$1.15 billion last year.
“I foresee a slight drop of about five percent in GCB prices but a much bigger fall of about 20 percent in GCB transactions for 2012,” said William Wong, Managing Director at RealStar Premier Group.
Although buyers expect prices to decline, most GCB sellers, who have strong holding power, are not prepared to reduce prices.
“Transactions are likely to start picking up only from the second quarter of 2012 as it will take a few months for buyers and sellers to monitor the market to see what actions to take in view of the introduction of the additional buyer's stamp duty (ABSD) effective 8 December,” he added.
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