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11-02-14, 10:05
http://www.straitstimes.com/premium/top-the-news/story/private-home-resale-prices-not-sign-market-rise-20140211
Private home resale prices up, but 'not a sign of market rise'
Published on Feb 11, 2014
By Cheryl Ong
RESALE prices of private homes edged up last month despite weaker buying sentiment resulting from loan curbs and other policies, new data has showed.
But market watchers said the 2.3 per cent rise in resale prices last month from December should not be mistaken for a sign of a strengthening market.
Figures based on a small number of sales were not a reliable overall indicator, they said.
The figures are from the Singapore Real Estate Exchange (SRX) resale price index, which tracks non-landed private homes in the secondary market.
A total of 310 homes changed hands last month - tumbling 70 per cent from the 1,039 units sold in January last year, and down by 9.1 per cent from December.
"The 2.3 per cent increase cannot be read as an uptick in buyers' interest in resale properties," said R'ST Research director Ong Kah Seng.
He said buying uncertainty, caused by property cooling measures and loan curbs imposed last year, had led to a handful of sales in recent times.
Monthly average prices based on a limited number of sales were "highly volatile", he added.
Mr Eugene Lim, key executive officer of property agency ERA Realty, said units sold at higher prices could have skewed the index.
"We should have a clearer picture of where the market is heading when we look at transactions in March to May, as these are the months that traditionally have a higher transaction volume."
Suburban units led the rise in resale prices last month, climbing 2.4 per cent.
Prices of homes in the city centre also rose by 2.1 per cent, while units in city fringes bucked the trend with a 0.9 per cent slide.
Mr Ong said suburban resale prices are unlikely to keep rising in the next few months, as buyers shy away from prices that seem to be at an all-time high.
Sellers faced with falling demand will need to adjust their expectations, leading to a muted resale market this year, experts added.
Mr Lim said he expects resale prices to ease by about 6 per cent to 10 per cent this year, because of the sizeable number of new homes coming on stream.
Last month, Urban Redevelopment Authority data showed that an estimated 19,907 units will come on stream this year.
Meanwhile, overall rents rose by 1.1 per cent, the first increase in six months.
The number of rental deals signed also rose by 8.1 per cent last month from December, to hit 2,348 contracts.
City fringe rentals led the gain, climbing 3.6 per cent. In the city centre, rents inched up 0.4 per cent, while rents in the suburbs rose by 0.2 per cent.
But the supply of new homes will put a lid on the rise, Mr Lim said. Landlords with units farther from MRT stations will have to be "more realistic" with asking rents.
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Private home resale prices up, but 'not a sign of market rise'
Published on Feb 11, 2014
By Cheryl Ong
RESALE prices of private homes edged up last month despite weaker buying sentiment resulting from loan curbs and other policies, new data has showed.
But market watchers said the 2.3 per cent rise in resale prices last month from December should not be mistaken for a sign of a strengthening market.
Figures based on a small number of sales were not a reliable overall indicator, they said.
The figures are from the Singapore Real Estate Exchange (SRX) resale price index, which tracks non-landed private homes in the secondary market.
A total of 310 homes changed hands last month - tumbling 70 per cent from the 1,039 units sold in January last year, and down by 9.1 per cent from December.
"The 2.3 per cent increase cannot be read as an uptick in buyers' interest in resale properties," said R'ST Research director Ong Kah Seng.
He said buying uncertainty, caused by property cooling measures and loan curbs imposed last year, had led to a handful of sales in recent times.
Monthly average prices based on a limited number of sales were "highly volatile", he added.
Mr Eugene Lim, key executive officer of property agency ERA Realty, said units sold at higher prices could have skewed the index.
"We should have a clearer picture of where the market is heading when we look at transactions in March to May, as these are the months that traditionally have a higher transaction volume."
Suburban units led the rise in resale prices last month, climbing 2.4 per cent.
Prices of homes in the city centre also rose by 2.1 per cent, while units in city fringes bucked the trend with a 0.9 per cent slide.
Mr Ong said suburban resale prices are unlikely to keep rising in the next few months, as buyers shy away from prices that seem to be at an all-time high.
Sellers faced with falling demand will need to adjust their expectations, leading to a muted resale market this year, experts added.
Mr Lim said he expects resale prices to ease by about 6 per cent to 10 per cent this year, because of the sizeable number of new homes coming on stream.
Last month, Urban Redevelopment Authority data showed that an estimated 19,907 units will come on stream this year.
Meanwhile, overall rents rose by 1.1 per cent, the first increase in six months.
The number of rental deals signed also rose by 8.1 per cent last month from December, to hit 2,348 contracts.
City fringe rentals led the gain, climbing 3.6 per cent. In the city centre, rents inched up 0.4 per cent, while rents in the suburbs rose by 0.2 per cent.
But the supply of new homes will put a lid on the rise, Mr Lim said. Landlords with units farther from MRT stations will have to be "more realistic" with asking rents.
[email protected]