CITY Developments Ltd (CDL), which posted a 10.4 per cent year-on-year drop in third-quarter net earnings to $120.6 million yesterday, has raised some red flags on the Singapore private residential property market.

CDL pointed out that while developers are starting to cut their prices in existing and new projects, willing to take lower profit margins, land prices on the other hand are continuing to escalate.

At state tenders, non-traditional developers, especially foreign construction companies, are entering the arena, bidding aggressively to secure land, while sacrificing their profit margins on construction.