In an environment that is flooded with information, how do we go about determining how Singapore property will fare in 2023?

Let's first look at how the Singapore property market performed before and after the epidemic.

When a market is hit by a huge economic shock, the reaction of that market tells us whether its fundamentals are strong or fragile.

From 2015 to now, the market as a whole is up 63%.

In the three years since the outbreak, prices in the core have gradually risen by 34%.

After the financial crisis of 2008, the Singapore government was adamant that it wanted to segment the property market from the international financial market.

Through a series of home purchase cooling measures and tax policies, buyers had to use more money as down payment and lower the loan component.

This step is a rainy day measure so that should we ever encounter a high interest rate environment, homeowners with loans will not be under particularly high payment pressure.

At the same time, government policy also requires local buyers of multiple homes, and foreign buyers, to pay additional buyer's stamp duty.

On this basis, when a market is volatile, homeowners will not be able to sell their homes easily, adding to the volatility of the market.

What many foreign buyers do not know is that the Singapore government has very high requirements for developers.

One of the legal provisions is that when a developer is working on a new project, they must build the project and sell all the units within five years or else the developer will be financially sanctioned with severe fines.

This policy is to prevent developers from manipulating prices, as in the Hong Kong market, where developers can extend the time period for the sale of their projects and speculate the prices up. This is a consumer protection policy.

The average number of new housing units sold in the Singapore market each year is between 11,000 and 12,000 units.

While this is a minuscule number compared to many Tier 1 or international cities, such figures must be contextualised.

Over the past five years, developers have launched an average of 10,000 new units a year, but the market has sold an average of 11,000 units a year, leaving a current stock of 16,000 units, a clear lack of supply in the market.

In short, if there are no new projects in the market, the existing stock will be absorbed in less than a year.

It is important to note that the average project in Singapore takes 3 to 4 years to deliver, and this lack of trend is not just a matter of a few years.

So, with the current housing stock situation, we have a serious housing shortage problem coming up in the next 3 to 5 years.

As you can see from the above, the residential condominium market in Singapore has a very promising opportunity to grow in the coming years.