"We like risk-reward ratios at current levels and believe that implied valuations have priced in a 10 per cent to 15 per cent portfolio deterioration in asset prices, a scenario which is unlikely given low interest rates and the low-yield environment," said analysts Derek Tan and Rachel Tan.
Although DBS remains cautious on the residential sector given heightened job insecurity stress, it noted most developers it covers have turned their inventory faster than peers, limiting exposures when sales slow. Moreover, a majority of retail exposure in Singapore will"rebound quickly", supported by deep population catchments, despite retail headwinds remaining. CapitaLand's China exposure is mainly in integrated developments.