New Launch in Singapore CEO sees rising inflation and interest rates as top risks

SINGAPORE (THE BUSINESS TIMES) - Nine out of 10 senior executives from new launches companies in Singapore cite inflation and rising interest rates as the top potential risk factors that could negatively impact the economy. market sentiment over the next half year, poll results show. This has overtaken growing construction costs, which previously topped the list during the first nine months of 2021 in the National University of Singapore Real Estate (NUS+RE) quarterly questionnaire.

About New Launch in Singapore - In the fourth quarter 2021 edition of the Real Estate Sentiment Index (RESI), about 73.3% of respondents identified rising construction costs as a key risk, down from 93% in the fourth quarter. father. Next on the list is financial tightening and liquidity in debt markets, chosen by 65.8% of executives, up from 32.6% in the previous quarter's survey.

Meanwhile, the percentage of respondents who consider "government intervention to cool down the market" as a potential risk fell the most to 39.5% from 62.8% previously. The government in December last year announced new measures to cool down the property market.

The RESI Research Composite Sentiment Index, a derivative of overall new launch projects market sentiment, also fell for the third consecutive quarter to 5.4 in the fourth quarter. This is down from 6.6 in the third quarter, 6.7 in the second and 6.8 in the first quarter. Professor Sing Tien Foo, Director of the NUS Real Estate and Urban Research Institute (IREUS), said: "The drop in sentiment indicators is mainly due to the Government's new cooling measures introduced by the Government. released in December 2021. The most affected luxury residential areas are adversely affected in the Q4 2021 sentiment survey."

New Launch in Singapore=: About 73.3 per cent of the respondents identified rising building costs as a key risk

NUS+RE states that despite the decline, the index remains above 5, indicating that overall sentiment about current and future real estate market conditions remains positive. In terms of future launches and sales, 47.1% of those polled expect a moderate or substantial number of units to be launched in the next six months, while 30% expect The number of apartments launched is moderate or significantly higher.

About six out of 10 real estate executives also expect unit prices of new launches over the next six months to be moderately or significantly higher, while 35% expect prices to stay the same.

IREUS deputy director Lee Nai Jia noted: "A combination of factors - including a recovering economy, dwindling supply due to delayed launch projects, and the perception of real estate as a resilient property class - has generated strong demand from upgraders and first-time homebuyers."

Dr. Lee pointed out that most respondents hold a cautiously optimistic view of the private housing market despite cooling measures and rising inflation. NUS+RE collectively represents the Department of Real Estate and IREUS.

Adapted From The Straits Times

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