Impact of cooling measures still unclear

It remains unclear whether the government’s seventh round of cooling measures have achieved its desired result of mitigating home price inflation, said a report from the National University of Singapore’s Institute of Real Estate Studies.

This is based on its latest Singapore Residential Price Index (SRPI) which monitors prices of completed non-landed private homes, excluding executive condominiums (ECs).

Resale prices of such homes rose 1.9 percent in April from March, building on the 1.1 percent gain seen in the previous month.

Meanwhile, prices increased across Singapore, with the non-central region recording the highest growth of 2.4 percent, a reversal of the 0.2 percent dip in March. Home prices in the central region also climbed 1.3 percent, extending the 2.8 percent gain the month before. Prices of small units (under 506 sq ft) rose 1.8 percent compared to the previous uptick of 0.8 percent.

“As with earlier policy measures, the latest cooling package announced in January apparently had only a temporary effect on the trajectory of housing prices,” the report said.

“Transaction volume and prices fell in February but have recovered since then, with the overall SRPI buoyed by the strength of the housing market in the non-central region … It is unclear that the seventh instalment of the cooling measures, described as the most comprehensive to date, has had the desired impact of mitigating house price inflation.”

Source – PRopGuru – 29 May 2013

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