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31-03-14, 18:42
http://www.straitstimes.com/archive/saturday/premium/money/story/private-home-resale-prices-keep-sliding-20140329
Private home resale prices keep sliding
Latest decrease blamed on softness in residential leasing market: Analysts
Published on Mar 29, 2014
By Melissa Tan
PRIVATE home resale prices continued to slide last month as home hunters gunned for newer units and investors kept away.
The decline was led by shoebox units, which consultants said were facing increased supply.
Overall, resale prices fell 0.4 per cent in February from January, according to Singapore Residential Price Index flash estimates yesterday.
This came on the heels of a drop in January from December last year, also of 0.4 per cent. The figure was revised from an estimate of a 0.5 per cent dip.
Consultants said the price decrease reflected the softness of the residential leasing market.
"Resale properties tend to have outmoded designs and could not reflect an upgrade in buyers' living conditions," said RST Research director Ong Kah Seng.
He added that February also tends to be an unpopular time to buy resale homes as investments.
More expatriates usually come to Singapore in the first half of the year, so buying in February could be too late to catch that wave of potential tenants by the time the deal is completed, Mr Ong said.
Shoebox resale units of up to 506 sq ft fared the worst last month, with a price drop of 1 per cent from the preceding month.
This was steeper than their 0.5 per cent decline from December to January, revised from a 0.6 per cent contraction.
The shoebox segment now has a bigger impact on the resale price index after the National University of Singapore (NUS), which compiles the index, revised its structure last month.
Shoebox homes account for 3.9 per cent of the nearly 79,000 units that NUS now tracks, up from 1.3 per cent of about 74,000 units before the revision.
Excluding shoebox homes, resale prices in the central region and on the outskirts of the island both fell as well.
In the central region, prices slid 0.6 per cent last month from January, a milder slowdown than the revised 1 per cent month-on-month drop in January.
Consultants put this down to ample unsold stock in the city centre combined with weak demand for luxury apartments.
As for the suburbs, resale prices dipped 0.2 per cent in February from January, a reversal of the revised 0.2 per cent rise in January from December.
"Not all suburban condominiums can be easily rented out at high rentals," Mr Ong said.
"Most expatriates feel suburban condominium developments have too many units, and (that) will affect the tranquillity of the living environment."
He expects private home resale prices to fall by up to 7 per cent this year compared with last year, with the central region bearing the brunt.
The new basket of 429 completed projects that NUS tracks for its price index includes newer ones such as Marina Bay Suites, Reflections at Keppel Bay and The Interlace.
[email protected]
Private home resale prices keep sliding
Latest decrease blamed on softness in residential leasing market: Analysts
Published on Mar 29, 2014
By Melissa Tan
PRIVATE home resale prices continued to slide last month as home hunters gunned for newer units and investors kept away.
The decline was led by shoebox units, which consultants said were facing increased supply.
Overall, resale prices fell 0.4 per cent in February from January, according to Singapore Residential Price Index flash estimates yesterday.
This came on the heels of a drop in January from December last year, also of 0.4 per cent. The figure was revised from an estimate of a 0.5 per cent dip.
Consultants said the price decrease reflected the softness of the residential leasing market.
"Resale properties tend to have outmoded designs and could not reflect an upgrade in buyers' living conditions," said RST Research director Ong Kah Seng.
He added that February also tends to be an unpopular time to buy resale homes as investments.
More expatriates usually come to Singapore in the first half of the year, so buying in February could be too late to catch that wave of potential tenants by the time the deal is completed, Mr Ong said.
Shoebox resale units of up to 506 sq ft fared the worst last month, with a price drop of 1 per cent from the preceding month.
This was steeper than their 0.5 per cent decline from December to January, revised from a 0.6 per cent contraction.
The shoebox segment now has a bigger impact on the resale price index after the National University of Singapore (NUS), which compiles the index, revised its structure last month.
Shoebox homes account for 3.9 per cent of the nearly 79,000 units that NUS now tracks, up from 1.3 per cent of about 74,000 units before the revision.
Excluding shoebox homes, resale prices in the central region and on the outskirts of the island both fell as well.
In the central region, prices slid 0.6 per cent last month from January, a milder slowdown than the revised 1 per cent month-on-month drop in January.
Consultants put this down to ample unsold stock in the city centre combined with weak demand for luxury apartments.
As for the suburbs, resale prices dipped 0.2 per cent in February from January, a reversal of the revised 0.2 per cent rise in January from December.
"Not all suburban condominiums can be easily rented out at high rentals," Mr Ong said.
"Most expatriates feel suburban condominium developments have too many units, and (that) will affect the tranquillity of the living environment."
He expects private home resale prices to fall by up to 7 per cent this year compared with last year, with the central region bearing the brunt.
The new basket of 429 completed projects that NUS tracks for its price index includes newer ones such as Marina Bay Suites, Reflections at Keppel Bay and The Interlace.
[email protected]