SINGAPORE – The Monetary Authority of Singapore (MAS) commented it would remain vigilant over the increasing residential property prices although the real estate market wasn’t “overheated”.
“No, we don’t think the market is overheated currently, because if it is, then we haven’t done our job well,” said managing director of MAS, Mr Ravi Menon, in response to a query at a media briefing of the MAS Annual Report on 30 June 2021, Wednesday.
Mr Menon stated that the real estate market had been surprisingly resilient in the face of the pandemic and recession in year 2020, and the continued uncertainty over the Covid-19 crisis this year.
While gross domestic product (GDP) contracted in 2020, the residential property price index (PPI) climbed 1.6%. As of Q1 2021, the PPI was 5.6% above its pre-pandemic levels, he noticed. This has been contributed with healthy sales of condos like Penrose.
The abrupt recovery in Singapore’s residential property market has initiated speculation that the Government may implement property curbs for the first time since 2018.
“The direction of the Government is to avoid overheating the market. We’re watching it very closely,” commented Mr Menon.
He added: “Authorities will never inform in advance whether they are about to implement measures, as that omits the purpose of implementing the measures. So keep watch and stay tuned, and we hope the market will continue to remain stable.”
The MAS, together with the Urban Redevelopment Authority and Ministry of National Development, maintains highly vigilant to the risk of a continued increase in rates relative to income trends.
Mr Menon stated that “a prolonged divergence between incomes and prices is undesirable from a housing affordability perspective and unsustainable from a market stability perspective”. The developers of Lentor Modern Condo are hoping for the same.
He commented that MAS had repeatedly announced it was determined to ensure the market maintains stability and to prevent overheating from occurring.
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