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Singapore property prices set to dive in 3 years

Singapore property prices set to dive in 3 years

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Singapore’s property market is set to crash over the next three years, reported the Wall Street Journal.

According to analysts interviewed, the dual impact of dampening demand and a supply flood will lead to the city-state’s real estate market to plummet 20% to 30%.

Though these party poopers are still a minority, an increasing number of observers note that the factors driving the property market upwards – tight supply and high demand – are about to be reversed.

On the demand side, recent government restrictions on migration are expected to crimp the population growth. Political pressure from concerned citizens has forced the government to make it tougher for foreigners to work in Southeast Asia’s financial capital, resulting in population growth slowing to less than 2% per year.

Combined with an expected slowdown in the country’s gross domestic product growth, the high demand for homes is expected to dampen.

On the supply side, the number of unsold properties is rising and expected to continue climbing. According to a Standard Chartered report, more than 100,000 new residential units are scheduled to be completed by both public and private sector developers over the next three years.

One creeping indicators that demand and prices could tip soon: In October, pre-sales for lower-priced projects were stronger than for luxury projects, suggesting that consumers are becoming more price-sensitive.

This is a summary of the original article.