Job-saving initiatives would relieve some of the pressure in the property sector

    • Singapore is on the verge of facing the biggest recession since its independence. With expectations of high rate of job losses haunting the citizens, the analysts hope that Singapore’s property market will be relieved to some extent due to the government’s determination and initiative to save the jobs of the citizens.
    • Private home prices and the total transaction declined by 1% and 12.5% in the first quarter of 2020 and this is expected to worsen in the days to come.
    • Private home prices are predicted to go down by 5 to 10 percent while the new homes are expected drop by 50% this year as compared to 2019 but analyst still expects that government’s measures to prevent job loss and loan deferments will lower down the pain.
    • DBS has estimated the relief amount to be S$68.8 billion or 13.8% of the nominal GDP.
    • Relief measures consider the grim fact that foreigners will bear the impact of layoffs and that homebuyers aren’t leverage more due to rounds of cooling measures since 2009.
    • Total employment went down by 19,900 in Q1 2020 and experts believe that the situation could be worse as circuit breaker measure has made data collection challenges.
    • Foreigners will account for 50 to 60 percent of the job losers and the count for the same can reach 100,000.
    • However, the current housing market is more resilient as compared to previous crises and the speculation is 1% which is negligible.
  • There were 40 sub-sales in Q1 2020 and the total transaction was 4,269 while during the Asian Financial Crisis (AFC) there was highly any transaction that took place and the speculation was 25% during the crisis in 1996 and the sub-sales transaction during GFC in 2008 was 13%.

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