By Desmond Ng

THE message was loud and clear.

We will not hesitate to step in to cool the property market if needed.

Finance Minister Tharman Shanmugaratnam warned on Tuesday that the Government will use every tool at its disposal "in a calibrated fashion" to prevent another boom and bust in the property market.

Such tools include credit rules, land supply decisions and tax policies. A day before that, the Monetary Authority of Singapore had said it would take action to cool the housing market if needed.

And what did we get yesterday?

Record sale

A news report that a four-room HDB flat in Queenstown was sold for a recording- breaking price of $653,000.

There may still be some debate on the kind of cooling measures to be introduced, but it seems to be clear that something needs to be done.

The minister's statement was a sobering flashback to 15 May 1996, when the Government introduced a surprise slew of tough anti-speculation measures at a time when property speculation was rife.

One effect was the downturn in the property market.

Will the introduction of similar measures cause a repeat of that?

It seems unlikely, property experts told The New Paper.

Most of them agreed that any measures introduced in future will be carefully evaluated and timed such that they will not come as a shock to the industry, as they did in 1996.

Chesterton Suntec International research and consultancy director Colin Tan said the new measures are unlikely to come all at one go.

He added that flipping activities, where speculators book a property for quick resale, are less rampant nowadays than in 1996.

He said: "Back then, people would book a unit and offer it for sale the next day. It's unlikely we'll see an onslaught of those measures (as in 1996) because they're less useful today.

"But people are tempted to buy properties today because it's relatively easier... (with) the low interest rates."

Gradual changes

ECG Property CEO Eric Cheng said that any new measures will be introduced in a more gradual way this time around.

"The Government wouldn't want a repeat of 1996. Now it gives ample warning first, and tells home-owners to be more prudent and buy within their means," he said. "If the market gets out of hand, it will step in, but there will be no surprises."

ERA Asia Pacific associate director Eugene Lim said buying and selling have slowed down considerably from the more frenzied activity of two months ago.

He said: "It's now a wait-and-see period. The market has slowed down and the Government is still trying to use supply to manage the market."

He added that the Government would want the property market to move in tandem with the recovering economy, and not too far ahead.

"The fastest curb could be an adjustment in the loan quantum, which could hit that group that is highly geared."

desmondn@sph.com.sg

This article was first published in The New Paper.