Wing Tai Holdings chairman Cheng Wai Keung yesterday warned that the probability of a price correction in the residential property market is high.
The market has enjoyed eight years of price rises since 2005, he said, at the company's full-year results briefing.
Mr Cheng, however, did not give a firm prediction on when prices would start coming down.
He cited several factors as heralding a likely correction including an expected increase in interest rates, which at their current low levels have helped sustain the property boom.
He said the looming possibility of an oversupply of units as well as the implementation of cooling measures and loan curbs signal an inflection point in market trends.
"I'm more for the last measure (of a 60 per cent total debt servicing ratio)," said Mr Cheng.
"This helps to weed out the weaker demand or buyers who are financially weaker and might rush into the market even though they may not be able to sustain repayments on the loan."
The property group's fourth-quarter net profit soared 72 per cent to $275.8 million on the back of a 52 per cent revenue jump to $307.8 million.
Full-year net profit doubled to $531.1 million largely owing to the sale of residential units as revenue leapt 113 per cent to $1.33 billion.
Progressive sales recognised from developments such as Foresque Residences in Petir Road and L'VIV in Newton, as well as the additional units sold at Helios Residences and Belle Vue Residences contributed to the jump.
Verticas Residences in Malaysia, which got its temporary occupation permit earlier this year, also boosted the higher earnings as revenue from all its sold units by June 30 was fully recognised.
Earlier this month, Wing Tai launched a freehold condominium, The Tembusu, and has issued options to purchase for more than 65 per cent of its 337 units so far, said Mr Cheng, which is "not bad given the market situation".
When asked if Wing Tai will jump on the bandwagon and invest in Malaysia's Iskandar, deputy chairman Edmund Cheng said the group will not do so despite the opportunities there.
"For Wing Tai, we want to invest in more mature cities such as Penang and Kuala Lumpur, which we have been in for some time."
Its chairman added that there will be no change in the near future to Wing Tai's investment strategy in Singapore, Malaysia, Hong Kong and China.
Full-year earnings per share based on profit after fair value gains on its investment properties more than doubled to 67.81 cents while net asset value per share rose to $3.62, up from $2.85 a year earlier.
Wing Tai is recommending a final dividend of three cents a share and a special dividend of nine cents a share.
Its shares rose one cent to $2.04 yesterday.
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