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CEOs Note .......................................................................................................................................................................................... 3 Executive Summary ........................................................................................................................................................................ 4 Methodology, Assumptions and Caveats ........................................................................................................................... 5 Results Analysis Asia Overview ............................................................................................................................................. 6 Malaysia ............................................................................................................................................................................................. 10 Demographics ..............................................................................................................................................................................11 Overseas Property ................................................................................................................................................................... 20 Sentiments ...................................................................................................................................................................................22 Indonesia ........................................................................................................................................................................................... 30 Demographics .............................................................................................................................................................................31 Overseas Property ....................................................................................................................................................................38 Sentiments ....................................................................................................................................................................................41 Singapore .......................................................................................................................................................................................... 49 Demographics ........................................................................................................................................................................... 50 Overseas Property .....................................................................................................................................................................58 Sentiments ......................................................................................................................................................................................61 Hong Kong ...................................................................................................................................................................................... 68 Demographics ........................................................................................................................................................................... 69 Overseas Property ....................................................................................................................................................................75 Sentiments ...................................................................................................................................................................................77 The Property Market in H2 of 2012 Asia Overview .................................................................................................. 80 Malaysia Indonesia Singapore Hong Kong

Going into the second half of 2012, the iProperty Group, owner of Asias No.1 network of property portals, embarked on the second iProperty.com Asia Property Market Sentiment Survey H2 2012 to gauge how the general public perceived the market compared to six months ago. Despite the economic situations such as the Euro-debt crisis and problems in the United States of America (US) which has resulted in slowing demand from Asia key trading partners, sentiments in the Asian real estate markets is still fairly positive. The introduction of cooling measures by governments across Asia including the implementation of stricter lending restrictions, increased stamp duties and higher downpayments, has helped curb speculation and stabilise property prices has proven effective. The survey gathered a total of 25,754 respondents and was conducted from 1st July 2012 to 31st July 2012 across the iProperty Groups network in Malaysia, Indonesia, Hong Kong and Singapore. Its main objective was to provide us with a platform to understand how the general public, property investors, buyers, sellers and owners, including locals and expatriates, perceive the property market in the next few months of the year. The survey results however revealed that the majority of the respondents are fairly cautious about the property market in Asia, which represented a micro view of the general declining sentiments. We trust that this report will offer valuable insights to not just our consumers, but also to developers, real estate agents, and local and international property buyers, as with this survey report they will be able to gauge the sentiments of the market from an unbiased perspective. We wish to thank all of the survey respondents for their valuable input on the property market. Should you have any comments and feedback pertaining to this report, please drop us an email at my.info@iproperty.com. Sincerely,

Shaun Di Gregorio Chief Executive Officer The iProperty Group

In the second iProperty.com Asia Property Market Sentiment Report 2012, survey respondents in Malaysia (iproperty.com.my), Indonesia (rumah123.com and rumahdanproperti.com), Hong Kong (GoHome.com.hk) and Singapore (iProperty.com.sg) revealed their intentions, preferences and motivations in acquiring property. Indonesian survey respondents were the most likely to have intentions to buy property in the next 6 to 10 months (82%), compared to their counterparts in Singapore (62%), Hong Kong (35%) and Malaysia (31%). 38% of Singaporean respondents who participated in the survey showed interest in overseas property, a significantly larger percentage than any other country surveyed. Most survey respondents in each country had only been in their current premises for 5 years or less. Those surveyed in Hong Kong were most likely (67%) to have resided in their home for less than 5 years. Most of those surveyed were between the ages of 26 to 40. Here are some other key findings: The earning power of women in Malaysia, Indonesia and Singapore has rapidly increased in comparison to the previous survey. Most of the survey respondents in Malaysia, Indonesia, Singapore and Hong Kong have occupied their current premises for less than 5 years. Location was a top priority that survey respondents in Malaysia, Indonesia and Singapore did not compromise on. Respondents in Hong Kong however considered price to be the most important factor in purchasing property. Affordability and rising house prices continue to remain the biggest concerns of survey respondents in Malaysia, Indonesia, Singapore and Hong Kong.

The iProperty Group conducted its second iProperty.com Asia Property Market Sentiment Report for the second half of 2012 with the objective of providing the general public, property investors, buyers, sellers and owners, including locals and expatriates with insights into the property market from a consumer perspective. In Malaysia, a total of 11,966 people responded to the online survey. The survey responses were taken from three collectors: a Facebook Post (23%), a Pop-Up invite (34%) and a web link (43%). In Singapore, a total of 2,983 people responded to the online survey. In Indonesia, a total of 9,805 people responded to the online survey. In Hong Kong, the survey gathered a total of 1,000 respondents. The survey was designed and conducted in both English and Chinese on www.GoHome.com.hk property website. An analysis of data from each survey question only considered data from questions that were not skipped. Survey respondents were provided links to questions that were non general related to help them understand more about the issue/topic before answering the questions.

Asia Overview Across the four countries, Malaysia, Indonesia, Hong Kong and Singapore, surveyed, the market sentiment showed that the property market in Asia continues to be cautious. The survey findings showed that people are more selective in their investments and investors are evaluating based on quality and fundamentals of each location. Those answering the survey tended to be the rising income group, with most in the 26 to 40 years old age group. There were also made up largely of executive/ managerial and professional occupations, mostly with annual household incomes above the national average. The majority of people answering the survey in each country had occupied their current premises for less than five years; in other words, they were not the type to settle for what they already had. Economic and political concerns were not high on the list of concerns for most survey respondents, which reflects the general economic health of the Asian region.

In deciding on whether or not to buy property, location and price were the highestrated factors for all respondents. Location was the most important factor for Malaysians, Indonesians and Singaporeans. While survey respondents in Hong Kong placed more emphasis of their purchasing decision on price.

43% of Malaysians surveyed owned two or more properties, the highest among all the countries surveyed, while Indonesia had the lowest percentage at 12%.

Indonesian survey respondents biggest motivation to purchase property was to own their own property at 72%, the highest among all the countries surveyed, followed closely by Hong Kong at 71%. Singaporean survey respondents topped the list for purchasing property for rental income at 37%, a result that was similar to the previous survey result. Malaysian survey respondents, on the other hand, were more keen to purchase property for investment compared to the other countries.

38% Singaporean survey respondents were interested to buy overseas property, the highest compared to all the countries surveyed, which is similar to the previous survey result findings.

Malaysians, Singaporeans and Indonesians considered location to be the most important factor of consideration when purchasing property. However, in Hong Kong, price was the deciding factor over location, a result that was the same in the first half of the year.

Most survey respondents had occupied their current premises for the less than 5 years reflecting the mobility of survey respondents and their desire to continuously upgrade their living environment.

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The real estate sector has been a major source of strength for the global economy since the most recent economic downturn. A report released by Malaysia Properties Incorporated (MPI) stated that the Malaysian real estate is in tandem with the continued growth in the economy. Major cities in Malaysia such as Kuala Lumpur, Penang and Johor Bahru, and with rising expectations in Kota Kinabalu, have seen capital appreciation in their real estate purchases. There is every indication that the countrys biggest asset, the growing young working population, will continue to drive the domestic residential market. Despite expectations of a slowdown during the second half of the year, the property market has seen a substantial increase in the volume and value of transactions in the residential property sector.

There are several factors that have contributed towards the growth of the Malaysian property market, namely: A growing economy estimated GDP growth between 4% to 5% for 2012 Ranked 11th on the Global Peace Index 2011 Ranked 16th on the Global Survey Financial System 2011 by World Economic Forum Ranked 21st on World Bank Global Doing Business 2011 Ranked 1st Best Place to Retire by the Japanese Ranked 4th Best Place to Retire by International Living Inc Ranked 18th Best Place to Migrate by the United States World Investment Report revealed that Malaysia has the 3rd best in FDI in Asean 5th Best in Asia and the top 10th in AT Kearney 2012 FDI Confidence Index

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Demographics: Young Workforce Ready to Buy 59% of Malaysians participating in the survey were male. In comparison to the previous survey conducted in December 2011, there was a significant increase in the number of female correspondents from 39% to 42%. This could indicate that, in general, the earning power of women is rapidly improving, which could mean they were now more financially independent or has built financial stability, and has the intention to create a secondary stream of income through property investment. Similar to the previous findings, the largest segment of the group was from the 31-35 years age group at 24%, followed by those between the ages of 26-30 years at 22%.

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In the survey, executives/managers (38%) and professionals (22%) made up the largest groups, followed by the self-employed (11%).

56% of the people answering the survey reported an annual household income of MYR80,000 or less. The largest segment at 25% are those who had an annual household income of MYR80,001 to MYR160,000. From the findings, we can see that the average respondents in this survey were relatively well-to-do.

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With the low barriers to property ownership and a healthy property price growth in Malaysia, it was not surprising to the see that more than a third (34%) of those surveyed considered themselves as Property Buyers. Just over a quarter (26%) of those surveyed considered themselves Property Owners, while about a fifth (20%) considered themselves as Investors.

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Almost a third (33%) of Malaysians answering the survey owned one property; while almost one in four (25%) Malaysians do not own a property. A significant percentage (43%) of those surveyed reported that they owned two or more properties. Again, this is an indication that the low mortgage interest rates, financing of up to 100%, no lock in period, stamp duty exemptions and long repayment periods has made property ownership in Malaysia relatively easy.

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A whopping 57% of Malaysians surveyed occupied landed property, most probably because the latter continues to offer better capital appreciation. Only 38% of those surveyed occupied private condominiums or service apartments.

Just over half (56%) of them had been staying at their current premises between 0-5 years.

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Almost a third (31%) of those surveyed intended to buy a property in the next 6 to 12 months, followed closely by 29% who intended to buy a property in the next 6 months. This could indicate that either the survey correspondents are waiting for the right time or right property to buy or invest, or that they are simply saving up money for the downpayment. There is also a perception among the Malaysian public that property prices in Malaysia will continue to increase, thus putting pressure on younger Malaysians to rush to buy their dream home now before prices increase further.

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At 73%, landed property was still the most popular type of property among the survey respondents, followed by 57% of those who were more interested in private condominiums or service apartments.

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In this series of Likert-scaled questions covering factors influencing when Malaysian survey respondents were ready to purchase property, location was still the most important factor closely followed by price, whether they were buying it for own stay or for investment. The third most important factor to these respondents is the potential capital appreciation/return on investment (ROI), which is why location and price were key considerations.

Location is a priority that investors and first time homebuyers did not compromise on. This is not surprising as there is a direct correlation between location and the value of a property. Indeed, a property located in a good location is assured of a better value. However, as land in urban areas become more scarce, many developers are forced to locate their development further away, which lead to the introduction of many new townships.

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Having decent shelter, adequate food, good health care and education are basic human rights, so it was a not surprise when the findings revealed that 43% stated that their main motivation to purchase property is to own their own property. Close to a third (30%) were looking for rental income investment. 27% wished to purchase property as investment for resale.

When it came to budget, almost 7 out of 10 respondents (70%) stated that their budget is under MYR500,000. With a majority of the respondents indicating that their current annual income level is between MYR80,001 to MYR160,000, looking for a home under MYR500,000 is certainly a viable option.

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Overseas Property: Majority Cautious but the Brave Prefer Singapore, Australia and the United Kingdom Investing in overseas property market seems to be unpopular among the survey respondents at the moment. This could be attributed to the Eurozone crisis, which is affecting economies worldwide. Almost half (49%) of those surveyed were not interested in investing in overseas property, most likely because of unfavourable currency exchange rate, being unfamiliar with the local regulations, restrictions on property ownership as well as an unstable global economy outlook. Nearly a third (32%) was undecided on the matter. However, CBRE, the international real estate advisory, stated that the top 5 investors by country based on total investment volume from 2010 to the first half of 2012 saw Malaysia in second spot after the United States with RM11.57 billion worth of investments. Germany came in third, followed by Saudi Arabia and Qatar. The responses generated from the survey 6 months ago also generated the same sentiments, where 42% of respondents indicated that they were not keen on investing in property overseas and only a handful, 18%, were keen on doing so, while the remaining 33% were undecided.

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The top three destination of choice for overseas property investment were still Australia, Singapore and the United Kingdom. Similarly to the previous survey results, about half of those surveyed (50%) will only invest in overseas properties after 2 years.

With Australia, Singapore and the United Kingdom being amongst the friendliest countries to Malaysian investors, it was not surprising that about half of the interested respondents who were keen in purchasing property overseas (50%) indicated the reason they would buy property in those location is because they wanted to migrate or retire there in the future.

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Sentiments: Positive on the Economy, Concerned over Rising House Prices The countrys population now stands at about 28 million, with an average growth of 2% per year, while the existing stock of residential homes is about 4.5 million with 584,546 of incoming supply based on the Property Stock Report 2011 by the National Property Information Centre. As such, by averaging 5 to 6 people per household, there is already equilibrium between the population and housing supply, thus there should not be any pressure on house prices. However, similar to the previous survey findings, affordability and rising house prices continue to remain the biggest concern for the survey respondents. However, this time around, errant developers and building quality trumps home financing policies and interest rates as the second biggest concern, probably because of the recent rise in the number of cases of abandoned projects and defective buildings.

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Just over half (52%) of those surveyed considered the current economic and political climate to be conducive to property investment. This figure reflects a slight reduction from the previous survey as the market is anticipating the upcoming General Election.

Bank Negara Malaysias (BNM) more restrictive lending guideline was introduced in 1st January 2012. The move saw BNM lower the loan-to-value (LTV) mortgage cap for third house financing from 90% to 70%. To gauge whether survey respondents also agreed that the move would moderate speculative activity in the market, just over half (54%) of those surveyed believed that this measure will achieve that objective. In the previous budget, the Government announced that it has reactivated the Real Property Gains Tax (RPGT). The RPTG has been increased (10% for the first two years, 5% in the third through fifth year of disposal, no tax will be imposed on property sold after the fifth year) to also help curb speculation.

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In comparison to the previous survey, the findings have indicated that survey respondents were still divided on its effect with 42% believing that it has helped curbed speculation versus 42% who thought otherwise. Among those surveyed, 43% did not believe that the RPGT will help contain surging household debt in the country versus 34% of those who believed otherwise.

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To help prevent the rise of abandoned projects by errant developers, The Housing and Local Government Ministry made the following amendments to the Housing Development (Control and Licensing) Act 1966: Developers to deposit 3% of the estimated project cost A MYR500,000 fine for developers who abandon their projects A maximum three-year jail term for developers who abandon their projects

These amendments were also in line with the Governments move towards the housing industrys widespread acceptance of the build-then-sell system by 2015. Nearly half (47%) of those surveyed were supportive of this ruling and believed that it will help reduce the number of abandoned projects in the country.

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A few months ago, the government unveiled a scheme offering 100% financing to first-time buyers to own a home. The Malaysia My First Home Scheme (MFHS) was targeted at young Malaysians earning less than RM3,000 monthly to buy his or her first affordable home. Although the scheme has been improved by increasing the ceiling price of houses to MYR400,000, nearly half (49%) did not believe that this measure has helped first time property buyers. This is quite a drastic increase from the previous surveys figure where only a third of the respondents (33%) felt the same. This indicates that the majority believes that the set ceiling price does not match the actual market price for homes in many locations, and that very few homes in urban areas actually meet the criteria.

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A whopping 51% of those surveyed believed that more should be done to protect property buyers in the country in lieu of the many cases where property buyers are often victimised and errant developers abandoning their projects. Only 30% of the survey respondents think otherwise.

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In lieu of the upcoming Budget 2013, respondents were asked which of the following policies they were concerned about and the findings revealed that their three biggest concerns were: Tax deductions on housing loans (61%) Lower interest rates (60%) Better housing schemes (58%) These factors were the main concerns as it is most likely to affect the prices of property by making it more affordable.

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Indonesia, which has the worlds fourth largest population (245 million as of January 2012) and strong economic growth, is experiencing a thriving property market. At least one research house has come out to support this view. Citi Research is positive on the Indonesian property sector saying its fundamentals look strong. In a recent report by the research house, it was stated that, the demand for property continues to outstrip supply and new launches are quickly being absorbed. Citi Research also added that the new rules that set a maximum loan-to-value ratio for housing loans at 70% to prevent a property bubble from developing would have little impact on the market. The report also stated that, Banks are aggressively providing mortgage loans, and even a lower LTV [loan-to-value ratio] of 70% is unlikely to dampen demand. However, in its current state, its full potential, especially in the residential real estate sector has yet to be fulfilled. Among some of the factors that are holding back Indonesias housing market were high tax rates, overly complicated bureaucracy, expensive building materials, high mortgage interest rates and onerous restrictions on foreign ownership. The countrys highly variable inflation rate also discourages borrowing to finance house purchases.

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Demographics: Majority wants to Own Their Own Home 63% of rumah123.com and rumahdanproperti.com respondents surveyed were male. And just like Malaysia and Singapore, the number of female survey respondents in Indonesia has also increased slightly. The occupations of these respondents were quite evenly spread out between admin (22%), entrepreneurs (20%) and professionals (19%).

Nearly a third (31%) were in the 26-30 years age group, followed by the second largest age group, those between 31-35 years, at 26%.

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A whopping 83% of the survey respondents had an annual household income below IDR100 million, while 12% of them made between IDR101 million and IDR200 million per year.

The majority (45%) of the survey respondents considered themselves Property Buyers, while another 19% considered themselves Property Owners. Only 1% of those surveyed were expatriates, which is only half the figure from the previous survey.

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Only about one in 10 (12%) of those surveyed owned more than one property, with 41% owning just one. However, 47% of survey respondents reported not owning a single property.

The vast majority (90%) of the Indonesians surveyed occupied houses, while only 5% and 3% occupied SOHOs and apartments respectively. This reflects a clear preference for landed property.

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More than half (54%) of those surveyed have only occupied their current premises for less than 6 years, while the rest of them are quite evenly split between the other categories, i.e. 6-10 years (16%), 11-20 years (15%) and my whole life (15%).

The majority (82%) of the survey respondents have the intention to buy property in the next 6-12 months. This clearly reflects their optimism on home ownership in the near future. Prices in Indonesias housing market were projected to grow more than in any other Southeast Asian country, with consistently rising prices in all housing segments. Housing prices in major cities grew 3.6% in the first quarter this year compared to the same period last year. However, housing price growth slowed to 0.8%in the first quarter this year compared to 1.2% growth in the fourth quarter of last year.

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Not surprisingly, houses top the list of the respondents favourite type of property (7%), while SOHOs (21%) came in at a distinct second. This is supported by the fact that the landed property market in Jakarta, the capital of Indonesia, remains strong with prices jumping about 31% last year over 2010.

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In this series of Likert-scaled questions, location and price remains the major factors for the survey respondents just like in the previous survey. Location is still the biggest factor for them as mostly likely the traffic situation in the urban areas is a big influence.

72% of those surveyed wished to possess their own property, which is a huge increase from the previous survey figure of just over half. Almost one fifth (20%) of the respondents were seeking rental income investment, while the remainder (8%) plan to invest in property for resale.

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Of those seeking to purchase property, 63% had a budget below IDR200 million, while a third (29%) of those surveyed had a budget of between IDR201 million and IDR500 million.

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Overseas Property: Planning for the long run According to property consultancy Knight Frank, 60% of Indonesian billionaires are after property in Singapore and Australia because of the accommodating regulations in place for foreigners there. It was also revealed that Indonesians bought 1,714 units of property in Singapore, compared to 430 units in 2000. Another reason for the trend was the good investment climate in Singapore and Australia. In Indonesia, foreigners cannot own a building ownership certificate, but can only lease property for 25 years and then extend that for another 45 years. The Straits Times reported in February that Indonesians were buying many of the most expensive homes in Singapore. Chinese nationals were the top buyers in Singapore, but Indonesian citizens were dominating city centre deals. Despite these findings, respondents were divided in their answers on whether they wanted to purchase properties overseas. 43% were undecided, 32% said they were keen while 25% indicated that they were not.

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While the responses were divided, out of the 32% who were keen on purchasing property overseas, 81% said that they wanted to buy property within the next 6 to 12 months.

It was undisputable that that the top choices were still Singapore (49%), Australia (14%) and Malaysia (10%). The International Real Estate Federation for the Asia Pacific region, attributed it to Singapore and Australias robust legal systems, liveability and rules about foreigners owning property.

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Most of the Indonesian buyers (58%) indicated that their main intention to purchase property overseas was for investment purposes as rental yields were high, while some (20%) wanted to purchase property there due to the favourable exchange rates. Only 18% cited migration as the main reason for property purchase.

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Sentiments: Errant developers and build quality were the greatest concern for those surveyed in the previous survey. In the current survey results, the majority of the survey respondents (73%) were most concerned about affordability and rising house prices, while 65% of them were concerned about errant developers and build quality.

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Similar to the figure from the previous survey response (73%), 69% of those surveyed felt positive that the current economic and political environment was conducive for property investment.

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Effective 15 June 2012 the regulators for non-bank and banking financial institutions (Ministry of Finance and Bank Indonesia) have enforced regulations that requires downpayments for new home and vehicle. The regulations are aimed at mitigating the risk of avoiding a property bubble and minimising credit risks. However, property and automotive sales would adversely be affected. Financial regulators began to enforce a minimum down payment of 30% for customers buying houses with loans. Previously, housing down payments were not specifically regulated but banks typically asked for a 20% downpayment. The government has also revoked housing financing liquidity facility (FLPP) loans for houses smaller than 36 sqm. The downpayment rule will cause a slowdown in the housing markets middle segment, but this will not be significant. With FLPP no longer implemented, this will affect the lower segment of the housing market. Seven in 10 (71%) among the survey respondents did not think this was a good move at all, which is not surprising considering the majority of them had a low annual household income. This would mean it would take longer for them to purchase their own property as they would have to save up more for the downpayment.

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Not surprising that about half of those surveyed (51%) think that 10% is the ideal figure, while the remaining amount should be shouldered by the finance institutions.

Housing credit is a credit facility granted by banks to individuals who want to buy or do renovations to their home. In Indonesia, there are currently 2 types of mortgages: Mortgage Subsidy - Which is a credit allocated to the income lower middle in order to meet housing needs or home improvements which has been owned. It is given in the form of subsidies: Subsidised credit is regulated by the government, as such, not every community who apply for credit may be granted this. In general, the restrictions set by the government in providing subsidies are based on the applicants income and the maximum credit given. Non-subsidised mortgages - A mortgage intended for the whole community. The provisions are set by the bank loan, so that the determination of the amount of credit and interest rate performed is according to the bank policy concerned.

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77% agreed with the subsidised interest rate through FLPP by the government.

More than half (57%) of those surveyed are optimistic about the programmes effect and believed it will give them an opportunity to buy a property.

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Similarly, 55% of the respondents are against new regulations to allow foreign ownership of properties in the country, even though the majority of them had a preference for landed property.

A whopping 88% of the respondents believed that property prices in the country will continue to increase in the future.

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Not surprisingly, 74% of the respondents think that allowing foreigners to buy properties in the country will lead to further increase in property prices.

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According to the latest figures published by the Urban Redevelopment Authority (URA), residential property prices in Singapore fell by 0.1% in the first three months of 2012. This compares with a 0.2% increase in the previous quarter and is the first quarterly fall in prices since the second quarter 2009, following nine consecutive quarters of declining price increases. The deterioration of the Eurozone debt crisis has affected the private housing market in Singapore. Feedback from various market players indicates a significant market slowdown in home purchases in both the primary and secondary markets during this period. This reaffirms the view that most of the current home buying consists of investments rather than for owner occupation.

Home ownership in Singapore is a unique state of affairs due to the hugely successful efforts of its Housing & Development Board (HDB), resulting in a high rate of public housing occupancy and a very small rental sector, mostly catering to expatriates. Over 50% of Singaporeans live in flats developed by the Housing & Development Board (HDB).

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Demographics: Well-Heeled Executives and Professionals Singaporeans who answered the survey were 54% male and 46% female. The survey reflects an increase in female respondents just like in Malaysia. However, unlike Malaysia, the largest age group (at 25%) was those between 41-50 years.

Almost a third (31%) of the survey respondents held an executive/managerial position, followed by professionals (21%) and those who are self-employed (14%).

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45% of those surveyed reported an annual household income of S$60,000 or less, while a significant minority (21%) earned above S$140,000.

Nearly a third (32%) of the survey correspondents identified themselves as Property Owners, while about a fifth (20%) described themselves as Property Buyers. The rest were divided between Investors (17%), Real Estate Professional/Property Agent (15%) and Tenant (11%).

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45% of those surveyed owned only a single property. 29% owned more than one property, while slightly more than a quarter (26%) reported owning no property of their own.

According to Singapores Housing and Development Board, HDB is home to about 82% of Singaporeans, with about 90% of them owning their HDB flat. As such, it was no surprise that the survey revealed that more than half (56%) of the respondents reside in HDB flats. About a third (33%) of those surveyed occupied a private condominium unit. Slightly over a fifth (21%) of the respondents occupied a landed property. According to a research by Jones Lang LaSalle, Singapore may experience a drop of up to 15% in prices of luxury homes this year as foreign demand dries up as a result of tightening measures and global economic uncertainty. The residential market in Singapore is expected to see a softer demand in general due to the weaker economic conditions as well as government policy risk.

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More than half (56%) of the survey respondents had occupied their present premises for five years or less.

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Despite a report released by CNBC Asia in April 2012, which stated that the residential market in Singapore is expected to see softer demand in 2012 given weaker economic conditions as well as government policy risk, more than half of the respondents, 62%, indicated that they would like to buy property within the next 6 to 12 months. This confirms the results obtained from the previous survey findings in which 68% of survey respondents indicated that they wanted to buy property. The Ministry of National Development (MND) and Urban Redevelopment Authority (URA) have given assurances that there will be sufficient supply of homes and that they will make more sites available, if necessary. As such, to provide greater transparency, these entities have been providing the public with more information on the property market.

Just like the previous survey result, private condominiums (67%) remain the most popular type of properties in Singapore. This could indicate that a majority of the respondents are looking to upgrade their existing homes. Close to a third (29%) of those surveyed showed interest in landed property, while 27% were interested in HDB flats. According to Knight Frank, Singapore is the most expensive market for high-end properties in Southeast Asia, and the main drivers of luxury homes in Singapore come largely from international buyers from China, Indonesia, Malaysia and India. Properties priced above $2500 psf are broadly classified as luxury in Singapore.

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In this series of Likert-scaled questions, both location and price were considered the most significant factors by a total of 1103 and 889 respondents respectively. Among the least important factors were recommendations as well as political and economic climate.

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On this scale, a rating of 10 indicates the highest importance and a rating of 1 represents the lowest. 39% of those surveyed stated that their main motivation for purchasing a property was to own their own property, while rental income investment (37%) came in at a close second. According to Jefferies Group Inc, home affordability in Singapore has risen to the highest in a decade because of historically low interest rates and flexible payment options available to buyers.

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33% had a budget of less than SGD500,000, while almost half (50%) had a budget between SGD500,000 and SGD1 million.

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Overseas Property: Divided in Decision to Buy 38% of the survey respondents showed a keen interest in investing in overseas property. This is hardly surprising as Singapores currency is one of the strongest and most stable in the region, making property investment overseas affordable. It can also be said that, due to scarcity of space and for the same value of money, Singaporeans are able to purchase landed property in neighbouring countries. However, international buyers, largely from China, Indonesia, Malaysia and India have been the main drivers of luxury homes in Singapore, which according to Knight Frank is the most expensive market for high-end properties in Southeast Asia. Properties priced above S$2,500 per square foot are broadly classified as luxury in Singapore.

About a third (34%) of those surveyed were 50% more interested, while 41% of them indicated that their interest in overseas properties were not more than 25%.

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Similar to the previous survey results, the survey respondents considered Malaysia (33%) and Australia (19%) to be their most preferred overseas locations. This can be attributed to the fact that unlike its neighbouring countries such as Thailand and the Philippines, Malaysia makes it fairly easy for foreigners to buy property due to the Malaysia My Second Home Programme (MM2H).

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A third (33%) of the survey respondents who intended to buy an overseas property planned to do so 1 to 2 years from now, as they are most probably waiting for the overall financial and property market to show signs of recovery.

38% of those surveyed cited retirement or migration as being the main motivation for buying overseas property, while 32% cited favourable exchange rates. This could indicate that many Singaporeans would like to spend their retirement years in Australia or Malaysia, as the latter has a lower cost of living while Australias currency is similar to that of Singapore.

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Sentiments: Adopting a wait-and-see approach According to 86% of the survey respondents, their paramount concerns about the Singapore property market were affordability and rising housing prices. Most are adopting a wait-and-see approach in the hope that property prices will come down. Economic and political uncertainties were the least of their concern this time around unlike the previous survey.. Data obtained from the Urban Redevelopment Authority also showed that private home sales have gradually fallen in the past few months. In addition, Singapore is also expected to see a surge in the supply of new units over the next few years both in the luxury and mass market segments, which will add further pressure on prices. A little over 32,000 new units will be completed in 2013 and 2014, 85% more than the number of units slated for completion in 2011 and 2012.

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81% of Singaporeans taking the survey did not think that the prices of HDB flats should be higher than that of private properties.

More than a third (40%) of those surveyed believed that they could afford to own a home in the current property market, while another 39% was undecided.

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Almost four out of five (80%) of the survey respondents felt strongly that the Singapore government should continue to be involved in maintaining the prices of resale HDB flats at an affordable level.

Just over a third (34%) of the respondents think that a significant rise or drop in prices will show in the next 6 months, while more than half (54%) of them believed that it would take 9 months or more.

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Only 40% of the survey respondents believed that the Governments Land Sales Programme could help manage the rate of property growth in the country.

The price increase of shoebox apartments have been outpacing gains in overall apartment prices since the property market recovery following the global financial crisis. However, shoebox apartments have made overall home prices in Singapore more volatile, with sharper price gains than larger homes. This is a key finding in an analysis by the National University of Singapore (NUS) real estate department. 63% thinks that the Singapore government should step up in their efforts to monitor the number of shoebox apartments in a residential development.

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A majority of those surveyed (59%) believed that not enough is being done to help singles, senior citizens, divorcees and other minority groups to own a home, as current property prices in the country are beyond the reach of the majority of these groups.

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Survey respondents were divided on how conducive the economic and political climate was to property investment. Their response was almost evenly split with 42% believing that the climate was conducive, while 38% felt other otherwise.

Recently, the Council for Estate Agencies (CEA) imposed a new ruling that requires those who are holding other jobs to secure their employers consent first, before becoming agents. The new ruling was said to be implemented as part of a regular review to enhance the level of professionalism of real estate agents in the country. Half of the survey respondents (50%) were favourable towards the new ruling as it will help improve the quality of real estate agents. iProperty.com Singapore also views the CEA regulations in a positive manner and believes that the intention at the end of the day is to protect the interest of not just the real estate agents but also consumers.

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The majority of the respondents (76%) rated the pricing of new HDB flats as their most important concern, closely followed by other concerns such as housing affordability for lower income groups (71%) and home financing policies and interest rates (66%).

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According to a report in South China Morning Post, only minor price fixes have been seen despite the recent cooling measures taken by the government the past two years to keep house prices under control in Hong Kong. It was also reported that in Hong Kong, house prices have reached peak levels, making it far beyond the median income for an average citizen. Despite this, the survey findings have revealed that nearly 60% of survey respondents are optimistic about the property market in the second half of the year, with local property prices hitting a record high in the second quarter this year. Both Hong Kong and the central government are now trying to address the affordability issue by increasing the supply of public housing. Hong Kong is increasing public housing for low-income groups as well as resuming and modifying the Home Ownership Scheme for medium-income households. The mainland plans to build 36 million subsidised apartments by 2015. However, since the supply of public housing is not expected to increase dramatically in the near future, we expect affordability of housing will remain a big issue.

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Demographics - Post-80 Generation with Desire to Purchase 57% of those responding to the GoHome.com.hk survey were female while 43% were male, which is a vast difference from the previous survey results which has higher percentage of males (56%) to females (44%). Ages from 30-49 years were well represented 66%.

In comparison to the previous survey results, there is a larger percentage of clerical and administrative positions (38%) while professionals were the next largest group (21%), while those who held an executive/managerial position represented 12% of the survey respondents.

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32% of respondents reported earning an annual household income between HK$200,001 to HK$400,000, while 35% reported an annual income between HK400,001 to HK$800,000. Only 11% of survey respondents reported an annual income of above HK$800,001.

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53% of those participating in the survey were property buyers, which was a slight increase compared to the previous survey findings (52%). A significant minority (33%) were tenants. 49% of the survey respondents also reported owning no property while 37% reported owning one property. Just 14% reported owning more than one property.

Among them, 55% live in self-owned properties; 30% rent private properties and 15% live in public houses/home ownership scheme flats.

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The survey shows Hong Kong people trade up their properties once every five years on average, with 67% revealing that they had only occupied their current premises for less than 5 years.

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35% of respondents were considering purchasing a property in the second half of this year, with a quarter of these (25%) planning to purchase a new flat, reflecting a strong demand for first-hand residential units and the transaction of new properties is expected to increase.

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In this series of questions, price was considered the most significant factor in purchasing property, followed by location and transportation. Recommendations by friends, family and agents were considered the least important.

On this scale, a rating of 10 indicates the highest importance and a rating of 1 represents the lowest.

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Overseas Property: Not an Option Only 15% of survey respondents expressed interest in purchasing property overseas, while a vast majority, 71%, expressed a lack of interest in the overseas property market.

Of those interested in overseas property, interest was split broadly across many overseas locations, with China (24%) being the favourite.

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Of those who are interested in overseas property, over half (52%) wanted to purchase property in at least 2 years or more from now with 43% citing migration or retirement plans as the main reason of interest.

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Sentiments: Mellowing Down 75% of property sellers believe that property prices will stabilise or rise to acceptable level. Among them, 54% are considering selling their properties in the second half of 2012, reflecting a more active supply of secondary market properties when compared to the first half of the year.

With the new government taking office on 1st July, much attention has been drawn to whether existing housing policies would change. Over half of the survey respondents (51%) believe the new government would have minimal impact on the local property market and property prices as a result are unlikely to fluctuate significantly. However, about 30% of respondents (29%) expect a decline in property prices. In particular, nearly half of the respondents in the high-income group expect property prices to decline. This reveals uncertainty among these respondents about the future housing policies and fear that the new administration may suppress property prices.

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73% believed that the decision by the Estate Agents Authority (EAA), from 1 January 2013, which requires agents to provide information on saleable area of a second-hand residential property to clients, would not impact their decision to purchase property in the second half of 2012.

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The top three housing policies they expect to be launched are resumption of Home Ownership Scheme (HOS), resumption of Home Starter Loan Scheme (HSLS) and increase land supply. These three policies are expected to present a significant impact on the development of the property market in the second half of this year. More notably, these findings, to a certain extent, suggest that those who have never purchased a property expect the new government to undertake measures to curb property prices so that they can afford to own a flat.

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The Overall Property Market in 2012 Sentiments among the Asian real estate markets is expected to continue on its downward trend going into the final quarter of the year, according to the report Emerging Trends in Real Estate Asia Pacific 2012 by PwC.. Overall, the reaction of the real estate markets in Asia is driven by events around the world. Although ASEAN as a whole is showing more growth, investors are currently experiencing more apprehension than in the past year. The common belief held by many is that the economy will be very volatile in the next few years with several potential event risks. The financial concerns of the United States and Europe continue to have a significant impact on the Asia Pacific markets. The PwC report stated that, going into the new year, investors will evaluate based on the quality and fundamentals of each location, while property buyers will be more selective in their investments. In Asia, banks continue to provide the lions share of funding for real estate investment while at the same time offering ultra-low base rates. However, the latter will not remain the same way indefinitely. According to industry pundits, how the situation will play out remains unclear. Fluctuations in the real estate market of some parts of Asia have been partly triggered by stringent measures on bank lending to developers, which was introduced by local regulators after several years of loose economic policy, thus causing prices to escalate. The PwC report pointed out that, in Hong Kong and Singapore in particular, authorities have introduced macro-prudential policies to combat rising home values. In both the commercial and residential markets, Singapore has experienced an aggressive pricing dynamic, a condition that has become a genuine concern for industry players. The difference between Hong Kong and the island nation, however, is that the latter has a substantial amount of mass market housing supply in the pipeline. In Hong Kong, an influx of capital from mainland investors, coupled with ultra-low interest rates resulting from the special administrative regions currency pegged to the US dollar, have pushed home prices to record highs, especially at the top end of the market. The report also stated that Singapore has also been experiencing asset price inflation as a result of a similar exchange rate policy. In each case, authorities have responded by imposing new stamp duties on a sliding scale for residential properties flipped within two years of purchase.

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Malaysia - Continues to Be A Buyer Friendly Market The Real Estate and Housing Developers Association Malaysia (Rehda) expected the housing and property market to remain resilient in the second half of 2012. According to a survey Rehda conducted, the property market in the first half of this year was driven by the domestic market, despite a common perception that foreigners were buying more local properties. The survey also revealed that property developers are optimistic about the second half of the year and plan to launch projects. However, these developers were less optimistic of the first half of 2013 due to factors such as the outcomes of the 13th general elections and Budget 2013, as well as uncertainties about the current global economic situation. Overall, the property market continues to be a buyer friendy market, amidst concerns about tighter lending rules, over-speculation and rising property prices. The latter is brought about by factors such as rising building material costs, shortage of prime land, record-low mortgage rates as well as speculative activities. Indonesia - An Emerging Market According to Emerging Trends in Real Estate Asia Pacific 2012 by PwC, the Indonesian economy appears to be one of the most balanced in Asia Pacific as the global market does not weigh as heavily on the country as it does on others. The chief driver of the Indonesian economy is private consumption, and forecasts have shown that prospects in that arena will remain bright well into next year. In general, the political and macroeconomic climate in the country has become more stable in recent years. The strong economic growth and high levels of investment has contributed to the growth of Indonesias housing market. Rapid urbanisation has resulted in high urban densities, which has lead to the price rise witnessed in new construction. Although there is tremendous pent-up housing demand, the majority of the people in the country are unable to afford their own homes due to factors such as high mortgage interest rates, foreign ownership restrictions, high costs of building materials, high tax rates and red tape in government.

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Singapore - A Resilient Market In recent years, Singapore has been a magnet for regional investors. In fact, the island nation is among the top 3 choices for investors from Indonesia, Malaysia and Hong Kong. However, the environment is now less rosy than before as there are general concerns that the market may have peaked. As such, some investors are getting ready to cash in on their profits, while others are adopting a wait-and-see approach with the hope that the situation will improve beyond 2013. To contain the situation, the government has taken steps to make more land available for development, as well as approving redevelopment and reclamation works. The need to maintain property prices in the affordable range is crucial as it is key to the nations economic development. Singapore, being an open economy, is vulnerable to global events, unlike countries that have much larger domestic markets. Despite the cautious outlook, industry pundits remain confident with the property market in Singapore due to its growing population, and strong immigration and tourism growth.

Hong Kong - Unconscious of Risk Genuine homebuyers in Hong Kong still prefer to trade up their properties despite local property prices hitting a record high in the second quarter of this year. The highincome group, in particular, tends to trade up every five years, accounting for 45% of the respondents while the middle- and low-income groups tend to trade up every six to 10 years. A minority of the people in Hong Kong anticipated a drop in property prices after the new government takes office, with much attention drawn to whether existing housing policies would change. Most, however, held the belief that the new government would have minimal impact on the local property market, thus property prices are unlikely to fluctuate significantly as a result.

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Australia: In Great Demand Australia is among the top 3 overseas locations to buy a property for investors from Malaysia, Indonesia and Singapore. The country is appealing for a number of reasons. One factor attracting foreign buyers is that unlike other countries in Asia, Australia has a market that is liquid. According to PwCs Emerging Trends in Real Estate Asia Pacific 2012, it is also one of the best markets in the region from a transparency point of view, with a culture that is friendly to Asians. In addition, unlike the situation in many Asian destinations, the lease structures tend to be longer term, and from an occupierdemand point of view, the market is currently at the bottom of the cycle, pointing to likely upward movement in rents.

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* Disclaimer Although every precaution has been taken in the preparation of this report, the publisher and author assume no responsibility for errors or omissions nor is liable for damages resulting from the use of the information contained herein.