Analysts predict completed homes to hit 19,302 in 2014

How will vacancy rate be affected?

According to Macquarie Research, 2014 will see the completion of 19,302 units (+6.6% in inventory), which would result in a vacancy rate of 9.3%.

Historically, property price declines have coincided with vacancies of 8% and above.

Here's more from Macquarie Research:

Downside pressures will come from both the primary and secondary markets, as developers could trim their price expectations (which some already have) to capture declining volumes and more resale units could become available post the 3-yr expiry of the seller’s stamp duty.

Overall, we are forecasting residential prices to decline 4% in 2014, led by the high-end (-5%) due to the continued absence of foreign buyers, impact of ABSD and sizeable completions (30% of 2014 supply).

Mid-end and mass would decline by a lower 4% and 3%, respectively due to continued interest from HDB upgraders and investors in view of an improved macroeconomic environment and low short-term interest rates. We expect sales volumes of 14,000 units in 2014 (-5% YoY), as prospective buyers will continue to feel the effects of TDSR.