Private home prices fall in all districts

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http://www.straitstimes.com/archive/...ricts-20140426

Private home prices fall in all districts

HDB resale prices also slide in Q1 as curbs on home loans keep biting

Published on Apr 26, 2014 12:55 AM

By Melissa Tan


MOVES to rein in the once red-hot property market are biting, with prices taking another beating in the first quarter.

Private home prices fell across the island - the first time in nearly five years that all segments have taken a hit in the same quarter. The biggest drop came in the city fringe, which includes areas such as Bishan and Queenstown.

The 1.3 per cent slowdown in the January to March period, a steeper slide than the 0.9 per cent drop in the preceding three months, was the broadest yet.

In the public housing market, Housing Board resale flat prices also lost ground for a third straight quarter. The 1.6 per cent drop there was sharper than the previous quarter's 1.5 per cent. The number of resale transactions fell again, down 5 per cent.

Analysts warned that the weakness in the market could deepen further, with the weaker HDB prices likely to affect the mass market private homes segment. They expect private home prices to fall 5 to 8 per cent by the end of this year.

A glut of unsold units is forcing developers to consider lowering prices, they noted.

Although the city fringe was worst hit in the first-quarter price slide, the city centre and suburbs fared little better.

Tough curbs imposed last year on home loans were the main reason, analysts said, but added that a Chinese New Year lull at the end of January dampened buying activity.

Developers also held back major launches as they waited to gauge market sentiment.

JLL Singapore research head Ong Teck Hui said the number of unsold units was weighing heavily on developers: "They have to compete with a significant backlog of unsold inventory."

Out of the total supply of 80,261 private homes under construction at the end of March, slightly more than a third - or 29,482 units - were still unsold, the URA said yesterday.

However, analysts held out hope that a slew of new projects in attractive locations set to go on sale over the next two months might cushion the price decline. These include Commonwealth Towers, The Crest and Highline Residences.

"With the market more attuned to the various measures and policies in place, the time is ripe for developers to step up launches... before prices head further south," said Colliers International research director Chia Siew Chuin.

One reason the city fringe was so hard-hit may be that developers are offering sweeteners and discounts to move units, analysts said. Prices of non-landed private homes in that segment sank 3.3 per cent in the first quarter from the preceding three months. This was a stark reversal of the 0.4 per cent rise the preceding quarter.

In the city centre, prices slipped 1.1 per cent in the same period, on the heels of a 2.1 per cent slide the preceding quarter.

OrangeTee research head Christine Li noted that for both the city fringe and city centre, new home prices fell more sharply than for those of resale homes.

The opposite unfolded in the suburbs, where new non-landed home prices rose 1.4 per cent.

That was likely due to solid sales at launches such as Rivertrees Residences and Riverbank @ Fernvale in February, she said.

Accounts executive Alicia Wong, 34, who bought a one-bedder at Riverbank, told The Straits Times she took the plunge as she "did not want to wait any longer". "Other projects launching later may not be as affordable."

After factoring in resale homes, non-landed private home prices in the suburbs still dipped 0.1 per cent. This followed a 1 per cent drop the quarter before.

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http://www.straitstimes.com/archive/...index-20140429

Private home resale prices fall again: Index

Softness in market reflects broader weakening in housing sector in Q1

Published on Apr 29, 2014 1:25 AM

By Melissa Tan


WEAK rental demand and tight loan curbs hammered private home resales again last month, deepening the gloom that has settled over the overall property market since the start of the year.

The price slide picked up speed from January to last month, according to Singapore Residential Price Index flash estimates out yesterday, with experts tipping worse to come.

Consultants expect prices to tumble 7 per cent to 11 per cent by the end of the year.

The central region bore the brunt of the slump, but the entire island took a hit, with overall prices down 1.1 per cent from levels in February, which in turn recorded a 0.9 per cent fall from January and a 0.4 per cent slip from last December.

This was due to a double whammy of lower demand from investors and upgraders, and the increased supply of homes, consultants said.

"Buyers of resale properties are more savvy and actively do their homework... They see for themselves the weakened property leasing conditions," said R'ST Research director Ong Kah Seng.

Nearly 17,000 non-landed private homes lay vacant in the first quarter, or about 7.6 per cent of the available stock, according to Urban Redevelopment Authority (URA) figures.

This was a jump from the 7.1 per cent vacancy rate in the fourth quarter of last year.

SLP International research head Nicholas Mak said: "As fewer new projects were launched in the quarter, there was less stimulus for the resale market."

Private homes in the central region were the worst hit, owing to a large supply of unsold new property combined with lower housing allowances for expatriates amid an uncertain global economic climate.

Resale prices there fell 1.3 per cent last month after dipping 0.2 per cent in February from January's level.

In the suburbs, resale prices slipped 1 per cent last month on the heels of a 1.5 per cent drop the month before.

They were likely dragged down because Housing Board upgraders would rather hold out for better bargains on new homes, as developers dangle discounts.

These figures excluded small shoebox units of up to 506 sq ft. The resale prices of these compact private homes lost 0.4 per cent from February to last month, after falling 0.7 per cent from January to February.

The shoebox segment has a bigger impact on the resale price index after the National University of Singapore, which compiles the measure, revised its structure in February.

The softness in the private home resale market last month reflected a broader weakening in the housing sector in the first quarter, as strict curbs on home loans imposed in June last year continued to bite.

Private home prices fell across the island - the first time in nearly five years that all segments had taken a hit in the same quarter, the URA said last Friday.

HDB resale flat prices also slipped for a third straight quarter, shrinking the pool of HDB upgraders.

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