How Did The Singapore Property Market Perform During Times of Volatility?

The Singapore property market has historically displayed resilience during times of volatility. Here are some observations on how the market has performed during periods of instability:

Global Financial Crisis (2008): During the global financial crisis, Singapore experienced a significant downturn in its property market. Prices declined by around 25% from their peak in 2008 to early 2009. However, the market rebounded relatively quickly and made a strong recovery in the subsequent years.

European Debt Crisis (2010-2012): Singapore's property market remained relatively resilient during the European debt crisis. While there was a slight moderation in price growth and transaction volumes, the impact was not as severe as in some other global markets. Property prices continued to rise, although at a slower pace.

Cooling Measures: The Singapore government implemented various cooling measures over the years to prevent excessive price growth and speculative activities in the property market. These measures have contributed to increased stability and helped cushion the impact of external volatility. For instance, the Additional Buyer's Stamp Duty (ABSD) and Total Debt Servicing Ratio (TDSR) were introduced to curb speculative buying and ensure borrowers' ability to service their loans.

Flight to Safety: During periods of global uncertainty, Singapore has often been perceived as a safe haven for investments. Investors seeking stability and security may choose to invest in Singapore properties, which can help maintain demand and support prices. This flight to safety has been particularly evident during geopolitical tensions or economic uncertainties in the region.

Government Intervention: The Singapore government has a proactive approach to maintaining stability in the property market. In response to market conditions, they have adjusted policies, implemented measures, and closely monitored the market to prevent excessive price fluctuations or speculative activities.

The proportion of Owner-Occupied Resident Household is at 89.3%, up from 88.9% from the previous period. Foreigners accounted for about 5% of private housing transaction pre-pandemic level, 2017-2019. Further sustainable measures were introduced recently, such as the tightening of TDSR and the increase in interest floor rate. Together with the recent increase in ABSD, investors holding on to properties are also less likely to dispose their properties and buy again, further reducing the supply. This results in a more inelastic market, further supporting price increase.

It's important to note that while the Singapore property market has generally displayed resilience during times of volatility, there can be variations in performance across different market segments, property types, and locations. It's also worth considering that past performance does not guarantee future results, and the property market's response to future volatility may depend on the specific circumstances and dynamics at that time.

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