Sales of resale private homes in Singapore sank in the first quarter this year with only 906 units in the secondary market changing hands, revealed a DTZ report.
This is a decline of 34 percent compared to the previous quarter. Year-on-year, it represents a stunning 62 percent drop.
Aside from the cooling measures, particularly the TDSR framework, the slowdown in activity is also due to buyers being more selective and holding back their purchases in anticipation of further price declines. This is especially so after the government recently said it was still too early to start relaxing the measures.
As a consequence, prices of non-landed private resale homes across the island fell further in Q1.
Based on a basket of completed properties tracked by DTZ Research, resale prices of luxury condominiums declined by a further two percent last quarter, following a two percent quarter-on-quarter drop in Q4 2013.
Meanwhile, resale prices of prime freehold and suburban leasehold condos fell by another 1.5 percent and 1.1 percent quarter-on-quarter respectively in Q1 after similar price declines in the quarter before.
Over in the landed segment, resale prices in all areas stayed flat in Q1 after a slower year-on-year growth in 2013.
Going forward, the consultancy expects demand for private homes to be affected by the competition from a higher number of project completions this year as well as reduced demand from HDB upgraders amidst falling HDB resale prices.
“These will impact private residential resale prices, which could decline by up to 10% this year,” said Lee Lay Keng, DTZ’s Regional Head (SEA) Research.