Statuses

Stamp duty increase to have positive spillover effect on leasing market?

In News flash, Uncategorized on December 12, 2011 by Lock+Store Tagged: , , , , , , , , ,

This appears to be the conclusion of research by Savills Singapore, at least in the short term. Savills’ research posited that total leasing volume this year could hit a new high of between 44,000 and 45,500 transactions. Leasing demand for Q4 is expected to reach between 10,000 and 10,500 transactions. In general, industry experts are divided about the impact on the rental market. Credo Real Estate executive director Ong Teck Hui is quoted in a Business Times article (10 Dec 11) as saying that 2012 would see increased downward pressure on rents and the leasing market.

‘Rental demand comes mainly from expatriates and foreigner workers, and this is expected to moderate in 2012 when the economy slows,’ he said.

Png Poh Soon, head of research at Knight Frank Singapore, was quoted in the same article as saying that ‘Notwithstanding a possible increase in leasing queries and demand, we will not expect the rates to increase significantly as new supply coming on stream next year and year after next will result in
offsetting effects on rentals,’ he said.

If the economic performance next year is within expectations (growth of 1-3 per cent), we can expect rents to improve by up to 3 per cent for 2012; conversely, rentals might fall by some 3-5 per cent under a pessimistic scenario, he added.

The verdict is still out on the impact of the recently announced stamp duty increase on the leasing market here.

 

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