OCBC Investment Research is downgrading the Singapore residential sector rating to “neutral” from “overweight” previously, as RHB Research places its “overweight” sector call and recommendations under review.

Meanwhile, Maybank Kim Eng reiterates its “positive” view and developer recommendations.

This comes as all three research houses now expect to see a slowdown in transaction volumes and overall prices as a result of the new measures, and negative stock reactions resulting from the latest property cooling measures announced on Thursday. To recap, a five percentage point increase in stamp duty for some home buyers – specifically those buying their second or more properties – have been introduced effective today, alongside tighter housing loans in Singapore’s bid to keep price increase in line with economic fundamentals.

In a Friday report, OCBC lead analyst Andy Wong explains the latest cooling measures were beyond "base-case" expectations, which has led to a change in the research house’s previous thesis that the positive sector outlook presented a buying opportunity in the midst of a sector correction.

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