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Private homes prices in secondary market up in March

Posted on 3 May 2012 | Comments Off

Prices of resale private homes increased by 0.8 per cent in March, after falling 1.6 per cent February.

This is according to the Singapore Residential Price Index (SRPI) flash estimates published by the Institute of Real Estate Studies at National University of Singapore (NUS).

It noted an increase in the housing transactions volume in March and it is possible that the market may be shaking off the impact of the cooling measure introduced last December.

The SRPI figures showed that while houses prices softened in the first two months of the year, prices have shown a slight rebound in March.

In particular, resale prices of small apartments rose most sharply.

The SRPI for March showed that prices for small units with floor area of 506 square feet and below increased by 2.8 per cent in March, compared with a 0.8 per cent decline in February.

Excluding small units, prices of resale private homes in the central area were higher by 0.8 per cent, while those in the non-central regions rose by 0.7 per cent.

These were much higher than February’s numbers.

In February, the SRPI for resale units in the central area was down by two per cent while units in the non-central area fell 1.2 per cent.

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More measures will harm property market

Posted on 2 May 2012 | Comments Off

Data for Q1 2012 released last week by the Urban Redevelopment Authority (URA) showed that residential property prices in Singapore dropped for the first time since Q2 2009, recording a 0.1 percent slip. This is in contrast to the 0.2 percent rise seen in the previous quarter.

According to OrangeTee Research & Consultancy, the decline “is within market expectations, as the market starts to feel the effects of market cooling measures introduced in December 2011”.

However, landed property prices are still resilient, marking a marginal increase in the quarter.

“The resilience in landed property prices can be attributed to the scarcity of landed properties as well as the profile of landed property buyers; less susceptible to market conditions,” said the firm.

While overall rents for Q1 2012 rose by 0.3 percent, it is still lower than the 0.4 percent growth in Q4 2011. Occupancy rates also dwindled marginally to 94 percent from last quarter’s 94.1 percent.

“According to URA’s statistics, a total of 10,796 units from developments with sales licenses are expected to be completed for the whole of 2012. As this is 10 percent above historical level, we expect the weakening rental market to cause occupancy rate to soften in the coming quarters, especially in the high end market,” said OrangeTee.

The main concerns lie in policy and supply. “The threat of more government cooling measures which could again have a negative impact on sentiments and possibly overly restrictive policies which might create further negative image of Singapore as an investment destination,” it said.

The slew of new project completions from 2013, along with a tightening of the immigration policy, could also affect rental demand.

Moving forward, “improving economic indicators and a recovery in the stock market has boosted confidence of buyers which has resulted in a strong primary sales market”.

“Without external factors that could trigger a rapid destruction in wealth, we maintain our view that the market will likely avoid a sharp fall in prices in 2012,” noted OrangeTee.

Source : Property Guru