CapitaLand, Southeast Asia’s biggest developer, paced gains by Singapore developers after Nomura Holdings Inc. said the potential pool of homebuyers exceeds the supply of private residences in the city, reported Bloomberg.
CapitaLand rose 3.5% to $2.99 as of 12:16 p.m. in Singapore, heading for the highest close in seven months. The FTSE Strait Times Real Estate Index of 45 property stocks surged to a six month high, climbing 1.1%. Keppel Land, the developer partly-owned by the world’s largest oil-rig builder, increased 1.9% to $3.19.
Households in the top 25 to 30 percentile in terms of earnings could now be buyers of private homes compared with the top 20 to 25 percentile in 2000, Nomura said in a report today. That suggests a 55% increase in the pool of potential buyers compared with a 39% increase in private housing stock in the same period, the brokerage said, citing a survey of income trends published last week.
The statistics “could help explain the robust local buying interest seen in recent launches,” analysts led by Min Chow Sai said in the note. Household earnings gained between 62% and 79% earnings for the top 30 percentile from 2000 to 2011, outpacing the 55% increase in private home prices over the same period, they said.
The latest statistics could support a further re-rating of the residential developers, Nomura said, adding it has “buy” recommendations for CapitaLand, Keppel Land and UOL Group
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