Not a bubble and the buying continues, more furiously.

For the past five (5) days, we have seen many news headlines surrounding the local property market.

Questions were rised whether the current surge in buying interests will result in a bubble when it's time to start paying the mortgage loans and whether any intervention should come in to reduce or stop any speculative market movements?

Further evidences may show the end of the recession and the signs of early recovery in Singapore's property market.

The buying just seems to go on. For example, Centro at Ang Mo Kio Hub attracted tons of interested buyers in its VVIP preview which saw most of the to-be-released units sold within the second day. Not to mention Optima at Tanah Merah MRT where by developers were forced to open the showflat late last night when the queue formed outside was way beyond their expectations.

The common explanations for the buying surrounds the reasons of the increased investors sentiment in the stock market, accumulated buying interests from people who have cashed out since the start of the financial crisis, upgraders and specu-investors who do not want to miss out the attractive deals of new projects.

So, don't be surprised when you find the shopping centres, town centres, coffeeshops, car showrooms, and sports facilities a little empty this weekend, and wonder where the crowd when?

You know the answer?

Catch them at locations found under my entry on "GSL"

The news just keep getting better?

Yes, indeed.

URA has just released its official second quarter real estate statistics yesterday. It says private home prices have fallen 4.7% this quarter compared to the first quarter 2009. This shows an improvement from its previous flash estimate of- 5.9% earlier in July 2. And this is much improved from last quarter's -14.1%.



Not to loose out to the race and joining in the bandwagon, HDB released their "Release of 2nd Quarter 2009 Public Housing Data" yesterday. The resale price index has risen 1.4%, which is a 0.2% rise from the initial flash estimate of 1.2%. The median cash over valuation or COV fell to S$3,000, a huge decrease from the $22,000 average during the 2007 boom.

Low COVs might explain why HDB flats are still in demand even in this uncertain economic climate, especially in matured estates where demand is much higher than supply. Some analysts say the strength of the HDB resale market is translating into the private home market, as the gap between mass market condos and resale HDBs gets closer (refer to my entry on "Are we where we think we are now"), prompting more of these 'HDB upgraders' to make the crossover into the private property market.

With all these said, do we have clear signs of where this property market is heading? One thing for sure, with the numerous project launches (see my entry on "GSL"), the showrooms will still be packed this weekend, with hungry cash loaded buyers who cashed out their gains in the stock market rally.

Bring your cheque book along!