Will 2016 see a recovery for private residential market?

In the midst of rising vacancies, rising interest rates and slowing economy, it is almost a foregone reality for a downward movement for residential prices. However there are some who believe the transactions may see a recovery of prices in the the second half of 2016. In Business Times this Tue, it was reported that some experts see a rebound in prices for high end market and secondary sales. It is viewed that the market has long priced in the oversupply situation in 2016. The rents and vacancy rates has not reflect the looming oversupply, with vacancy rates exceeded 10% in 2016. It may take up to mid 2017 for the vacancy levels to improve.

The reason for the uptick in residential prices may be attributed to pending economic stimulus from the government and mature markets overseas such as Australia and London to turn bullish. The resale market may also provide some positive surprises to the buyers, since the residential market has been dominated by primary sales by developers for the past few years.

 

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