IS428 2016-17 Term1 Assign1 Lim Hui Ting
Abstract
In recent years, there is a growing concern of oversupply of residential property in Singapore which many speculate that it could be due to the cooling measures in place that led to a sharp fall in demand for private residential property amid hefty supply. Thus, this assignment aims to analyse the private residential property market in Singapore by looking at the supply and prices of these properties in 2015 and provide recommendations to the current housing policies for 2016.
Our analysis shows that the current private residential property market is not stable enough for the cooling measures to be lifted off due to an increasing trend of speculative buying in the Condominium market. However, the possibly oversupply of Condominium in the market may requires necessary adjustments to the current housing policies before a downward spiral of Condominium prices occur.
Problem and Motivation
An article from TODAY newspaper in 2015 states that the current housing supply in Singapore will be able to meet the demand up till 2030. The article highlights a growing concern of the oversupply of residential property in Singapore (Ku, 2015). This could possibly due to the cooling measures in place since 2009 in order to alleviate the overheated housing marketing in Singapore. Mr Augustine Tan, president of the Real Estate Developers' Association of Singapore (REDAS), said the successive introduction of the measures since 2009 had led to a sharp fall in demand for private residential property amid hefty supply (Goh, 2016).
There are ongoing debates on whether the cooling measures should be lifted. Analysts are speculating that some property cooling measures might be relaxed in 2016 due to consecutive quarters of decline in the housing price index (Singapore Business Review, 2016). On the other hand, a news article from Straits Times states that the cooling measures are unlikely to be eased or adjusted in 2016 as the interest rates are likely to remain low and investors continue to look into the real estate market for higher returns and low risks investments.
Thus, it is important for us to analyse the current private residential properties situation in Singapore by looking at the supply and price in order to determine if there is indeed an oversupply of housing in Singapore and whether the current cooling measures should be lifted.
Approaches
1. Data Preparation
As Executive Condominium(EC) is a special type of housing in Singapore excluded as it is a hybrid between public and private property, EC is excluded from the subsequent analysis. Thus, only datasets relating to Apartment, Condominium, Detached House, Semi-Detached House and Terrace House are retrieved and analysed for this assignment.
Datasets for the supply and prices of private residential properties in Singapore are retrieved from REALIS Timeseries and Transactions tab respectively. Due to the restrictions on REALIS database, datasets are downloaded in batches and subsequently combined using Excel. [INSERT PHOTO][INSERT PHOTO] As the initial datasets downloaded are in comma limited form, as shown in fig xx, Excel’s text to column function delimited by comma is used to transform these datasets into respective columns, as shown in fig xx. These datasets are subsequently imported into Tableau to create visualisations. Inforgraphics is created using the dashboard function is Tableau.
2. Use of Chats
2.1 Box Plots
Box plots are used to visualise the distribution of private residential properties prices in Singapore. This is because the variables involved both categorical data(i.e Property Type) and continuous data(i.e unit price per meter square). Box plots are able to illustrate the distribution of the unit prices more effectively than bar charts providing details such as the different quartile groups, outliers and allow the readers to be able to compare across the various property types more effectively.
However, we understand that box plot can be deceptive in datasets that have a bimodal distribution. In datasets that have a bimodal distribution, bar charts will be used to complement the findings in the box plots.
2.2 Line Graphs
Line graphs are used to visualise the private residential properties supply Singapore. This is because the dataset contains a column called “time” where it has the data for the four quarters of various years. Line graphs are more effectively in showing the trends of Singapore’s private residential properties supply for the four quarters in 2015.
2.3 Marimekko Charts
Maimekko Charts are used to visualise each property type supply and vacancy in various planning regions over time respectively. This is because various dimensions and measures of the data are required to be added into the chart which might be complicated for other charts such as bar graph. Using Marimekko charts, we are able to visualise the various contributions of the different property types in the private housing market in Singapore.
3. Analysis Approach
In the datasets, there are 3 types of sales namely new sale, sub-sale and resale. According to URA, the definition of the different types of sales are as follows:
New Sale: The sale of a unit direct by a developer before the issuance of the Certificate of Statutory Completion and the Subsidiary Strata Certificates of Title or the Certificates of Title for all the units in the development.
Resale: The sale of a unit by a developer or subsequent purchaser after the issuance of the Certificate of Statutory Completion and the Subsidiary Strata Certificates of Title or the Certificates of Title for all the units in the development.
Subsale: The sale of a unit by one who has signed an agreement to purchase the unit from a developer or a subsequent purchaser before the issuance of the Certificate of Statutory Completion and the Subsidiary Strata Certificates of Title or the Certificates of Title for all the units in the development.
Speculators are usually more involved in subsale transactions. Since the market varies for the different type of sale, we will analyse the distribution of the unit price and supply for the different types of sales separately.
