http://www.straitstimes.com/archive/...ugust-20140930

Resale home prices unchanged in August

Published on Sep 30, 2014 1:38 AM

By Cheryl Ong


THE Hungry Ghost Festival brought property buying to a standstill last month and left resale home prices flat.

Developers also shied away from launching projects while buyers pulled back in anticipation of attractive discounts at upcoming launches, market watchers said.

Prices were unchanged last month after a slight rebound in July, when private home resale values inched up 0.1 per cent from June, according to the National University of Singapore's Institute of Real Estate Studies price index yesterday. Earlier estimates had indicated a slip of 0.3 per cent.

Mr Nicholas Mak, research head at SLP International, said: "The 'ghost month' could have resulted in a reduction in the number of buyers and sellers in the secondary market."

A dearth of new residential projects also had a flow-on effect in the resale market, as buyers typically take an interest in surrounding property following the launch of a new condominium, he said. "The low volume caused property prices to move sideways."

The price index comprises sub-indexes tracking resale home prices across the property market. Prices of suburban units rose by just 0.1 per cent, compared with an increase of 0.3 per cent from June to July. Values of small resale private homes - those with floor areas of up to 506 sq ft - eked out a 0.1 per cent rise last month. They had slipped by 0.4 per cent from June to July.

Resale prices of city centre homes remained unchanged, an improvement from the 0.1 per cent dip from June to July.

Mr Ong Kah Seng, director of R'ST Research, said yesterday's data does not point to a recovery in the resale market, which has been buckling under the weight of several rounds of cooling measures and mortgage lending restrictions.

Luxury units in the city centre have been the hardest hit. "Owners putting up their high-end residential units for resale are feeling the strain of competing with developers with ample unsold stock. Developers are offering attractive price discounts," said Mr Ong.

Mr Mak predicted that resale home prices could dip by 5 to 10 per cent over the next year. "In the absence of fresh leads of changes to government policy for the private housing market, private real estate prices are likely to weaken gradually."

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