The lack of property-related measures in yesterday’s Singapore annual Budget 2016 came as no surprise to most industry observers, given that most property sectors are at the early stages of consolidation and any interference at this juncture would be too premature.
Real estate firm JLL said that as for the residential market, an absence of changes to market cooling measures was also expected as the Government has conveyed its concern that premature easing of market cooling measures might lead to a market rebound.
Nonetheless, Budget 2016 is not without exciting news for the real estate sector.
Indeed, JLL expressed its excitement about the development of Jurong Innovation District (JID). Positioned as an “industrial park of the future” the JID will be developed and touted to be the “future of innovation for enterprise, learning and living”.
The development of JID will see the currently “sleepy” Jurong West transformed into a thriving hub of activity. As the development of JID takes shape, we can expect demand for real estate ranging from homes, offices, retail, hospitality and industrial to rise and along with this, a general rise in real estate value in and around JID.
It will also trigger private-sector interest in real estate development and investment and thus, we can expect to see an increased level of activity in this locality in time to come. Potentially, the Government Land Sales programme might soon start to incorporate land parcels in and around JID to kick-start the transformation.
The development of JID will also complement the development of Jurong Lake District by creating a larger draw for the population to work, live and play in the western corridor of Singapore.
Whilst there are no property-specific measures in Budget 2016, given that demand for real estate is a derived demand, the plethora of measures aimed at helping companies and individuals ride through the expected economic slowdown should help prop up demand for real estate and cushion the office, retail and industrial markets against a hard landing amid a backdrop of a challenging economy.
The host of measures engineered to help the island-nation stay competitive in the medium-term and cope with new challenges of the new world in the longer term will ensure long-term stability for Singapore’s property market.
Indeed, the announcement of the JID is a show of the government’s commitment to prepare and navigate the economy and its population to transform through innovation.
