Singapore Real Estate Sector - RHB Invest 2023-04-06: Market Likely To Turn In 2H23

Singapore Real Estate Sector - Market Likely To Turn In 2H23

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Real Estate - RHB Investment Research  | SGinvestors.ioCITY DEVELOPMENTS LIMITED (SGX:C09) APAC REALTY LIMITED (SGX:CLN)
  • We visited City Developments (SGX:C09)’s Tembusu Grand show flat recently and came away with the view that demand, though still resilient, has softened year-to-date. Buying is also more selective with preference towards smaller units indicating cooling measures and interest rates are starting to weigh in.
  • - Read this at SGinvestors.io -
  • Keep NEUTRAL on real estate sector with top pick as City Developments.

We expect property prices to see a slight decline in 2H23.

  • The Urban Redevelopment Authority (URA) flash estimates (1Q23) saw overall property prices rising 3.2% q-o-q, but on lower volumes (-8% q-o-q, -38% y-o-y). Non-landed properties rose 2.5% q-o-q driven by the rest of the central region, which rose 4% q-o-q attributed mainly to new launches at benchmark prices amid low overall inventory levels. We see 3 key reasons for property prices to slow down in 2H:
    1. - Read this at SGinvestors.io -
    2. impact from economic slowdown and labour market weakness, and
    3. sharper impact from increase in interest rates with the 3-month Singapore Overnight Rate Average or SORA rising ~50bps since start of the year.
  • Overall, we maintain our full-year price expectations of -2% to +2%.

Volumes slowing amid increasing pricing expectations mismatch.

  • Read more at SGinvestors.io.





Vijay Natarajan RHB Securities Research | https://www.rhbgroup.com/ 2023-04-06



More views on outlook of real estate sector:
Analyst Reports on Singapore Property Sector





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