Asia Pacific Real Estate Markets to Seesaw in ‘12

Knight Frank predicts that the Asia Pacific property market may remain in flux throughout 2012 as various governments continue to intervene in an attempt to keep real estate …

Knight Frank predicts that the Asia Pacific property market may remain in flux throughout 2012 as various governments continue to intervene in an attempt to keep real estate prices stabilized. Despite downward trends in countries that include Malaysia, Singapore and China, experts believe many measures have worked to keep large swings out of the market. The likely result, say analysts, will be peaks and troughs that don’t extend too far beyond the baseline established for the year. India, Australia, Vietnam, Thailand and others may dip but otherwise remain steady, while some others like Indonesia will experience modest gains. For more on this continue reading the following article from Property Wire.

Real estate markets in the Asia Pacific region are likely to see varying fortunes in the coming months as various government policies continue to affect the sector, according to Knight Frank.

Continued government intervention in property markets across Asia has proved effective, as lending restrictions, additional taxes and protection from hot foreign money has led to a quarterly drop in mainstream prices across Malaysia, Taiwan and Singapore, its latest report shows.

China, the largest housing market on the planet also continued to see prices on a downward trend, with the central government resolute in managing a soft landing. India, which is facing a stuttering economy, also saw prices turn negative over the last three months.

In contrast to these drops however, Indonesia continued to see price rises on the back of rising incomes and urbanisation, reflecting an underlying demand for quality accommodation. Similarly, housing markets in New Zealand and South Korea also experienced solid price appreciation over the quarter.

Australia continued to see its housing market deflate with the fifth consecutive quarterly price fall and Japan saw a continuation of the long term price falls.

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The Chinese market is expected to continue to soften, however if economic data indicates a significant weakening in the economy over the year, the central government could ease some measures to stimulate activity, says Knight Frank.

Similarly in Malaysia, expectations are for prices to remain steady over the coming months, with the possibility of a modest decline through the remainder of 2012.

In Singapore, given the large amount of supply coming onto the market, along with existing unsold inventories, prices of private residential properties are expected to continue to correct through 2012.

Indonesia is expected to continue to experience strong demand, although the effect of the new minimum down payment of 30% for mortgage loans from June 2012 could have an effect on performance, particularly in the middle to low end segments.

In Thailand, despite large amounts of supply, increasing labour, construction and land costs are being passed on from developers to purchasers, with modest price increases likely to continue through the year.

In Vietnam, with inflation moderating, the market is looking at bottoming out and could see a pickup in activity if interest rates are able to be eased further.

In Hong Kong, buyers are expected to remain more reluctant to make purchase decisions, amid uncertainty in the world economy. House prices are expected to therefore soften during the year, but at a modest rate, given limited supply.

India is likely to continue to see an uneven year, with the cities that experience high levels of speculative demand likely to be more volatile than those based primarily on end user demand.

In Australia, with sentiment remaining weak, the market is hopefully looking to a further interest rate cut to potentially stimulate demand and bring about a pick up in volumes and prices.

This article was republished with permission from Property Wire.


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