New Condominiums along Lincoln Road SingaporeWhile doing research for our series on the recent cooling measures, we came across the news that many buyers queued up the night before the measures were scheduled to be deployed. Why the rush to buy? Apparently, they were led to believe that prices would somehow increase once the cooling measures came into force.  As Elvis Presley infamously told us ”Wise men say, only fools rush in…”

Unfortunately, this type of seemingly foolish behaviour is manifesting more in the recent property climate. Taking the pre-cooling measures queue to buy for example; if those buyers had thought it through, they would realise that developers would not change prices any time soon. There would be no reason for developers to lower prices before the cooling measures were due, and neither would there be reason for them to increase prices after the measures are activated.

In fact, developers today are even considering giving discounts on their wares to counteract the market effects of these cooling measures. Q Bay Residences will have a stamp duty discount of 5% to 7% together with its 15% early bird discount. Far East Organisation also implemented a limited-term 5% discount across almost all its properties. And D’Leedon increased its discount from 3% to 15%. With the property market expected to slow down, such discounts will likely be more common, not less, in the future.

These buyers were simply caught up in the hype and panic after the cooling measures announcement was made, further whipped up by parties with a vested interest in getting more property sales. In other words, it was just a marketing tool for them. The buyers gained practically nothing by rushing to close the deal. For those who were not affected by the recent cooling measures, waiting would even save them money, in light of these developer promotions.

We might scoff at how silly all that marketing and hype seem to be, but the truth of the matter is, many in the Singapore property market fall prey to it. The rush to buy property before the cooling measures kick in, is just one example. This has prompted us to write a bit on what we’re seeing on that front, as well as the effect it has on buyer sentiment, developer expectations and market prices in general.

Stay tuned this week as we highlight even more odd behaviour in the property market that may end up being financially detrimental to those who make such rash decisions. For the latest updates and articles on BLUTA-log, remember to like or follow us on our FacebookTwitter, and Google+ pages.

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