Signs are clearer. Bulls are retreating and bears are taking shape.
Our immediate neighbour – Singapore is experiencing the first squeeze in office rents. Singapore’s Straits Times reported that it is a great news for office tenants, but far leaner times for landlords as office rents have plummeted by more than half in the past 12 months. On average, they fell a whopping 53.4 per cent from their peak in the third quarter of last year to Sept 30 this year - the second-fastest rate of fall in the world. Only rents in Kiev, Ukraine, fell more quickly, by 64.6 per cent.
That meant the Republic fell from 9th spot to No.32 in the latest Top 50 most expensive markets list, according to a half-yearly global survey done by US-based consultancy CB Richard Ellis.
The occupancy cost here - rent plus local taxes and service charges - is now US$63.89 (S$88.25) per square foot (psf) a year, down 23 per cent from six months ago when it was in 15th place. That is down more than half from US$135.13 psf a year ago.
A little bit farther to north east – Hong Kong’s home market is taking a breather. Cheung Kong launched Le Prime in Tseung Kwan O for sale last Friday, with about 180 units being sold over the weekend. The selling price was largely in line with the secondary market price in the neighbourhood. Market response was weaker than that of its neighbouring Le Prestige, which was launched in July 2009 and sold out in three weeks.
In short, buyers seem to adopt a ‘wait-and-see’ approach amid uncertain global economic outlook. The home market in Thailand is also showing sign of losing momentum since October. Residential prices have ceased to rise since October, according to some of my contacts in Thailand.
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