Refering to Saturday (1 Aug 09) newspaper (The Straits Times), there were many new property developments for sale (by developers). I could easily spot more 5 such advertisements, some taking more than one full page.
Over the couple of months, there were a lot of talks about properties being snapped up by buyers. Some new developments were even sold out in one day, some even sold out before the actual launch.
Buyers goes out viewing new developments with cheques in hand, more than ready to issue the 1% deposit. I even learned of a buyer who had to pay 5% deposit to developer.
Buy Low, Sell High!
This doesn't seems to apply now. Buyers are buying high, thinking property prices will not come down. This was the same mindset in the 1990s, that Singapore is land scarse and with huge population for this island country with only 687 square kilometers of land.
During the Asian Financial Crisis, 911 terrorist attack in 2001 and SARS in 2003, our economy almost collapse to its knees, and property prices dropped down to 60% value of their all time high. People have forgotten the lesson.
Developers knows the economy better than commoners do. Developers are in the business of making money. If they can sell their properties at a much higher price, why would they rush to dump their developments all at once?
When developers dump properties , it is time to be wary. When developers even demanded 5% deposit, the signs are even more worrying.
Is a property market correction on it's way?
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