FEWER PROPERTY TRANSACTIONS FOR SEPTEMBER 2010.

Ryan Huang from Channel News Asia reports:

Property agents said the sale of private residential homes have dipped between 10 per cent and 20 per cent in September.

This comes exactly a month after the government rolled out a slew of new measures to help cool the property sector.

Some observers said transaction volumes could trend lower in the coming months, as there could be a lag in the full impact from the new rules.

However, foreign visitors have been adding to the numbers at showflats over the weekend, making it slightly more crowded than usual.

According to property agents, many of the visitors were here for the F1 Grand Prix and a slew of business conferences over the past week.

Property group ECG, for example, said it has seen a 10 per cent increase in visitor numbers.

Despite the increased numbers, industry players said buyers are holding back.

CEO of ECG Property, Eric Cheng, said: “Though there is an increase in the viewing rate, it does not mean that there is an increase in transactions. The last two weeks, we have seen that a lot of developers have not been advertising aggressively, because a lot of buyers out there and even investors have this wait and see approach…”

Observers said a key factor is the tighter restrictions introduced last month to curb property speculation.

This appears to have made buyers more cautious, and has lengthened the typical time taken to complete a transaction.

Agents said that on average, the turnaround time between a viewing and a sale is taking twice as long, with some buyers holding out hoping for better prices.

A sale on the primary market usually takes about two weeks, while a sale on the secondary market can take more than a month.

The number of transactions handled by HSR have dipped 10 per cent from the average 1,500 sales it usually sees every month. ECG said it has seen about a 20 per cent dip from its usual volume of 500 sales.

Industry players said mass market homes have been the hardest hit from the new rules, with prices for that segment sliding by up to 10 per cent in September.

CEO of HSR International Realtors, Patrick Liew, said: “We have seen a few properties selling below the normal market value, but by and large, most prices are holding steady and in fact my prediction, in a short while’s time, the prices should continue to increase again.”

Some observers like HSR are expecting property prices to stay flat for the next six months, before starting to climb moderately by about 5 per cent for next year.

However, others like ECG are more pessimistic and believe prices could drop by 10 per cent before bottoming out.

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