Brokers expect booming private residential property sales in Singapore, especially in the mass market segment, to result in the government imposing another round of tightening measures.
“The bulk of the strong volumes represent demand for small mass market units that are substantially investment-driven in our view,” CIMB Research said.
“Larger units, typically more suitable for owner occupation, have seen slower take-up. With mass market prices showing little signs of relenting, we see pressure mounting for further tightening measures,” it said in a report.
CIMB kept its neutral rating on the sector and highlighted CapitaLand as its top pick and has an underperform rating on City Developments. CapitaLand's shares were down 1.7% at $2.9 and have gained 31% so far this year, outperforming the broader market.
Private home sales excluding executive condominiums surged to a record 6,682 in the first quarter, the highest since the first quarter of 1996 when the Urban Redevelopment Authority began compiling the quarterly data.
“We do not discount the possibility of further measures in the shoe-box segment, although we highlight the volumes are supported by favourable interest rate environment, affordability levels and strong liquidity,” Credit Suisse said.
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