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S’pore property stocks sink as 4-year boom ends

SINGAPORE: Singapore property stocks sank on Friday after data showed the city-state’s four-year private property boom was over.

At midday, shares in Southeast Asia’s largest developer CapitaLand were down 3.30 percent, City Developments was off 3.70 percent and Keppel Land was down 4.36 percent against a broader market decline of 2.24 percent.

Preliminary government data released on Thursday showed that private residential property prices fell 1.8 percent in the third quarter — the first drop since the first quarter of 2004. Singapore’s market had been described by real estate giant Jones Lang LaSalle as the world’s hottest in 2007, when property prices surged 31 percent overall.

But as prices edged closer to peaks reached in 1996, the growth slowed earlier this year and prices were up just 0.2 percent in the second quarter, said the Urban Redevelopment Authority, which oversees land use planning.

“Our forecast is for a property down-cycle lasting at least 1.5 years from now till end 2009,” the US bank Goldman Sachs said. Government approval for two casino complexes in 2005 was one of the major factors behind the revival of Singapore’s property market, which had been stuck in a rut stemming from the 1997 Asian financial crisis.

Efforts to woo wealthy foreigners to take up residence in Singapore, along with an all-out bid to attract skilled foreign migrants, also drove the property market revival.

The rebound left many expatriates struggling to cope with soaring rents which in some cases doubled. afp

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