Singapore property stocks higher on hopes housing demand will be sustained

Singapore property stocks higher on hopes housing demand will be sustained

SINGAPORE (Thomson Financial) - Shares of Singapore property developers were
higher Friday on hopes that housing demand will be sustained in the months ahead
despite a slower pick-up in sales in recent weeks.
At 10.55 am (0255 GMT), Allgreen was up 6 Singapore cents at 1.82 dollars,
CapitaLand up 15 cents at 7.95 dollars, City Developments up 40 cents at 14.30
dollars, Keppel Land up 15 cents at 8.10 dollars and Wing Tai up 10 cents at
3.50 dollars.
There are several indicators showing that housing demand remains intact despite
the recent turmoil in the financial markets induced by concerns over the fallout
from the US subprime crisis.
The number of Singaporeans upgrading from public housing to private
condominiums has been rising and demand appears to be spreading into the mid- to
mass-market segment.
In the second quarter, 1,750 Singaporeans quit their public housing apartments
and bought private residential property, 75 percent more than in the first
quarter, Citigroup said in a note.
"We are positive on the outlook of the mass market as transactions made by
(public housing) upgraders surged in the second quarter and prices have started
to move," Citigroup analyst Wendy Koh said in a note.
Rising rental yields are also boosting demand for mass residential property,
Koh said.
"While we expect secondary transaction volume in the second-half to slow
compared to (the) first-half, residential prices are expected to continue their
upward trend given the demand-supply disequilibrium," she said.
Developers sold more than 9,000 apartments in uncompleted residential projects
in the first-half, with prices rising an average of 20 percent from a year
earlier.
Kim Eng Securities analyst Wilson Liew said he will wait for the third quarter
data on housing sales to see whether demand is holding up.
"Demand may not be as strong as what we've seen in the first two quarters of
the year," Liew said.
But he believes that over the longer term, demand for property will remain
intact, considering the string of projects in the next few years.
"We haven't seen the peak," Liew said.

Source:Thomson Financial