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Published July 28, 2011

S'pore Q2 luxury home prices stay flat in wake of govt curbs


(SINGAPORE) Luxury residential prices in Singapore stayed flat in the second quarter as buyers remained cautious after recent tightening measures by the government, said Jones Lang LaSalle (JLL) yesterday.

According to a report from the property consultancy, prices in Singapore's luxury prime market remained stable in Q2 - there was no change either from the previous quarter or the previous year.

Across Asia, the mood in luxury residential markets was generally muted. Average capital values rose 1.6 per cent quarter- on-quarter in Q2, slightly lower than the 1.8 per cent increase seen in the previous quarter.

'Sales activity cooled in Q2 11, with fewer launches and sales recorded in most markets as a result of ongoing tightening measures by various governments,' JLL said.

It monitored eight luxury residential markets and prices remained stable in three of them in Q2: Mumbai, Shanghai and Singapore. In Beijing, prices declined 1.9 per cent quarter-on-quarter.

In the other four cities - Bangkok, Hong Kong, Jakarta and Kuala Lumpur - capital values increased during the quarter.

Hong Kong's market was particularly strong, with luxury residential prices surging 7.3 per cent quarter-on-quarter and 28.3 per cent year-on-year in Q2, due to continuing rental growth and tight supply. Prices rose despite government measures aimed at curbing speculative demand.

JLL expects luxury residential prices to generally remain stable or see slower growth this year due to policy and interest rate risks.

'Prices in China are expected to either remain flat or edge down slightly over the rest of this year as developers will likely introduce more price discounts and launch less high-priced units over the next 12 months,' it said.

In Singapore, prices are likely to remain largely stable over the second half of the year, with 'continued demand from end-users and long-term investors'.