Multiple unit buys should be tracked

Published July 17, 2007

Multiple unit buys should be tracked

This would indicate level of speculative activity, says Colliers International

By KALPANA RASHIWALA


COLLIERS International has suggested that the authorities track multiple-unit purchases of private residential properties, which could be used to show the level of speculative activity.

Individuals who own several properties may dump them if the market softens and this exercise could potentially accelerate any property downfall, the property consultancy argued.

Colliers' director for research and consultancy Tay Huey Ying, said: 'So far, the government has been giving details on the number of subsale deals - which refer to secondary market transactions for projects that have yet to receive Certificate of Statutory Completion and are often seen as a proxy for speculative activity. That's useful information.

'But in addition to that, perhaps the government may also want to monitor and see the extent to which people are buying several units or even floors, particularly at new residential property launches, as that may also reflect an intent to speculate, that is, buying units with the aim of flipping them within a short period of time.'

When contacted, a spokeswoman for the Ministry of National Development said: 'The Urban Redevelopment Authority does not monitor multiple purchases by individuals. However, the government is monitoring the property market closely, to ensure that it remains healthy and sustainable.'

Ms Tay said that in addition to tracking multiple-unit buyers as a lead indicator for future speculative activity, there could also be other potential implications of such buying activity. 'If the market drops, and these buyers want to let go of their units, we could see many units on the market, and that will further accelerate any price downfall,' she said.

Ms Tay said she was more concerned with individuals who buy multiple units rather than than institutional investors like funds which make such purchases, since corporate buyers typically have greater financial muscle and are looking at holding their assets for rental income over a longer timeframe. 'Individuals are more likely to lack the financial muscle to hold on to their purchases if the market softens,' she said.

In addition to tracking those who buy multiple units or floors in the same development, Ms Tay also observed there were many individual investors who have been buying units across Singapore. 'That also deserves monitoring,' Ms Tay added.

Is it possible to prevent property crash by imposing fine to those who sell below market price/latest average price???

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Originally Posted by Unregistered

Is it possible to prevent property crash by imposing fine to those who sell below market price/latest average price???

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Ha ha ha!
Quite a cute suggestion.

Although I believe this is a bull market, I do not believe in manipulating the market (by setting rules/conditions) to artifically push the market up or prevent it from coming down.

If it have to come, let it be. Let it finds its equilibrium level. I know it is bad for me/us when it comes down. However, we just have to let the market forces determine the market level.

i think ura or sla sld simply do a proper job by enforcing proper inputting of accurate transanctional data (caveat) and penalise wrong entry or data omission. if everyone in the chain doesnt do his part, whatever data we base our analysis on will be flawed. currently some of the data are erroneous or omitted.

plus sla is doing a very poor job in administering and presenting the data in an enivronment friendly manner. can you imagine wasting one pc of paper for a caveat with little valuable info? would like to see more heart and efforts by the management there...

btw, kudos to those in ura team which did up the model displays (1st/2nd storeys)... frankly, we should do a similar model for display in the airport so that all those ever touched down into singapore, in transit will have something wow to go back with.. it's beautifully done and provide good knowledge of singapore landscape...