Coupled with an expected slowdown in the global economy, home-buying decisions may stall in 2012. And developers may also roll out more incentives to prop up sales.
Despite the uncertain economic outlook in 2011, home-buying interest remained healthy judging by the long queues at recent property launches.
nalysts expect new private homes sales to hit a total of 15,000 to 16,000 units this year, compared to nearly 16,300 units sold in 2010.
Next year, crowds at property launches could get thinner as weak economic sentiment undermines the confidence people have in keeping their jobs.
Sales volume for 2012 is likely to dip further to under 14,000 units for the whole year.
Dr Chua Yang Liang, Research Head, Jones Lang LaSalle, said: "If the transaction volumes were to declined and sustained into 2012, then prices are expected to be affected. From our forecast we think possibly between 10 to 15 percent on the downside."
Analysts say there is no chance of recovery for high-end property next year, with prices likely to slide 20 per cent.
The sale of high-end units was already lacklustre before the government imposed an Additional Buyers' Stamp duty in December, which will further dampen demand from foreigners.
Market watchers expect some diversion of investor interest from residential, to other real estate including office and strata industrial properties.
Meanwhile, the cheaper home loans and genuine latent occupier demand are expected to continue to drive the mass market home segment. However, prices for such homes could see a downward correction of about 10 per cent next year. For the latest updates on the stock market, visit Stock Market Today For the latest updates PRESS CTR + D or visit Stock Market news Today
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