I realized that it has been a rather long time since I wrote a macro piece (especially for a self proclaimed macroeconomic focused value investor). As such, given the current hype over Singapore’s residential market, it appears high time to review this particular sector’s fundamentals.
The Hype
The spotlight on Singapore’s residential market was primarily driven by the recent spate of en-bloc deals by different developers. While unlikely to top 2007’s en-bloc craze, 2017’s en-bloc figures thus far have proven to be the greatest in the past 10 years.
Source: Bloomberg
This was soon followed by news that Singapore’s private home prices had increased by 0.5% in Q3’17 – the first rise in 4 years.
Source: URA
The tiny 0.5% price growth brought about great hopes that Singapore’s residential market had bottomed out. Such a view would have coincided with my guesstimate last September for residential prices …