Since last year, many people always ask me when do I think the property market will drop. My answer is simple: “just look at the demand and supply”. Often, they will ask the second question, “Why the market hasn’t dropped?” “Because it takes time to build the house.”

Here was the headline news of Straits Times on Saturday. “HDB resale deals at 16-year low”.

Figures released by the HDB this week showed that there were 4,335 transactions in the first quarter of this year, the lowest figure since 1997, when the HDB started revealing the numbers. On average, the first three months of every year have seen 8,000 transactions. That was nearly half of the average transactions for the first quarter of the past years!

It seems the 7 rounds of cooling measures finally spook the market and the government’s determination of bringing down the housing price is reluctantly accepted.

I had to update the address for a client 3 times a year because he flipped his property that often. But he hasn’t been moving house for the past 3 years. Another client of mine has 5 properties but he has been status quo for quite some time. This appears to me a sign that the demand of the resale market is diminishing.

If you have not noticed, there was another news on Saturday too, “Record 18,400 new homes to come on-stream”. It was reported that URA data showed “An estimated 18,400 homes are set to be built this year, easily eclipsing the previous high of 14,600 units built in 1997”. National Development Minister Khaw Boon Wan’s goal to make home ownership affordable and not “to walk backwards to have a day where only 20 per cent own homes and the rest are renting” seems reassuring to me that the construction of HDB will keep pace with the market demand.

I have repeatedly emphasized that you should look at the property market the same way as the stock market. Property market was driven up by the imbalance of supply and demand, and now the demand and supply is moving to the equilibrium.

Both the stock market and property market have been inching up with lower volume, the coming few months will be the real litmus test and the market will “show hand”.

Never mind whether you are a HDB buyer or investor or speculator (there wasn’t a clear distinction in the first place), you have to stay vigilant. Don’t just believe what you have always believed, read widely and think out of the box.

There are many free online resources like iProperty or PropertyGuru. Spend some time to check out the market information of HDB Singapore. Many people spend more time researching the latest electronic gadgets and put in less effort to study their own properties which cost their life savings.

As Mr Khaw Boon Wan put in MND’s blog “let’s talk about housing“,

“Housing concerns all of us: whether we are buying or selling… It is an emotive topic, as it is the biggest purchase in our life… We are pulling out all stops to deflate the bubble without causing it to suddenly burst. This requires skills and luck. After much effort, we are seeing light at the end of the tunnel, though we are still not yet out of it.”