Friday, December 21, 2012

Here's where the real trouble in the property market comes

Physical completion rate exceeds population growth from FY14.

OCBC cautions of a formidable wave of completed units to hit in FY14-15.

"We see private residential completion increasing dramatically in FY14-15 with ~42k units being completed. With a similar spike in HDB
completions in FY14-15 (est. 48k units) and expected slower population growth of 100k pa ahead, we see the capita per physical home ratio
begin falling in FY13," it said.

OCBC notes that if most of these units are not owner occupied, the secondary market could start seeing downward price pressure as well as pressure on residential rental levels.

Martin Koh | 86666 944 | R020968Z
Sherry Tang | 9844 4400 | R020241C
Senior Sales Director
DTZ Debenham Tie Leung (SEA) Pte Ltd (L3006301G)

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