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Published January 27, 2007

Property sub-sales mostly in narrow belt

New URA indices also show 25% price jump in prime districts, Downtown Core, Sentosa


(SINGAPORE) Revamped private housing data from URA released yesterday show the highest volume of sub-sales last year was in the prime districts, the Downtown Core including Marina Bay, and Sentosa. Prices of uncompleted non-landed homes in these areas also jumped 25.4 per cent in 2006.

Sub-sale deals in the core central region comprising districts 9,10, 11, Downtown Core and Sentosa made up almost 10 per cent of all private housing deals in these locations in Q4 last year.

The URA data also show further evidence of a very uneven market, with full-year price gains for completed non-landed homes of as little as 0.9 per cent in the rest of the central region (which includes places like Bukit Merah, Geylang and Toa Payoh), 2.9 per cent outside the central region, and 9.9 per cent in the core central region.

Welcoming the detailed indices, DTZ Debenham Tie Leung executive director Ong Choon Fah said they confirm the development of a two-tier market. 'This year, we're going to see more launches and new benchmark prices set in the core central region.'

Colliers International director Tay Huey Ying said: 'The new figures tally with the common perception that newly launched, non-landed projects in the hotspot locations of the Orchard Road luxury belt, Marina Bay and Sentosa Cove have registered the sharpest gains.'

URA's overall private home price index rose 3.8 per cent in Q4 from the preceding quarter, and 10.2 per cent for the whole of last year.

In the core central region that includes the traditional prime and newly popular waterfront districts of Marina Bay and Sentosa Cove, the price index for non-landed private homes rose 4.9 per cent quarter-on-quarter in Q4 2006 and 17 per cent for the year.

A further breakdown of the figures shows uncompleted properties posted bigger gains than completed properties. The former rose 6 per cent in Q4 and 25.4 per cent full-year, while the latter rose 3.1 and 9.9 per cent respectively.

The overall - uncompleted and completed properties - index for non-landed private homes in the rest of the central region was up 2.2 per cent for Q4 and 3 per cent for the year.

The outside central region - which covers typical suburban mass market locations such as Woodlands, Clementi, Jurong, Hougang, Tampines and Bedok - posted smaller increases of 1.5 per cent in Q4 and 4.2 per cent for the full year, on an overall basis.

In the public housing segment, the HDB resale flat price index rose 1.97 per cent for the whole of 2006.

Prior to yesterday, URA had only made public global private home price indices for various housing types - condos, apartments, terrace, semi-detached and detached - without giving a breakdown by location. This tended to mask the two-tier market that has been developing over the past couple of years.

Prices in prime districts and new waterfront districts at Marina Bay and Sentosa Cove have been racing ahead - fuelled by strong demand from foreigners, won over by the global city story the Singapore authorities have been pitching, as well as well-heeled Singaporeans.

In contrast, prices in traditional suburban locations like Woodlands, Hougang, Tampines and Bedok, where most average Singaporeans live, have gone up much less.

URA's figures also show the highest concentration of sub-sale activity - a gauge of speculation - last year was in the same core central region, with 285 deals or 67 per cent of the total 426 sub-sale transactions island-wide in Q4 last year.

Sub-sales accounted for 9.7 per cent of total private home deals in the core central region in Q4, compared with 3.5 per cent in the rest of the central region, and 2.3 per cent in outside central region.

Across the island, 426 private homes changed hands in the sub-sale market in Q4 last year, up 47 per cent from the preceding quarter. The Q4 sub-sales made up 5.4 per cent of the total 7,896 private home transactions island-wide in both primary and secondary markets in Q4 last year - higher than 2.7, 2.5 and 5.1 per cent respectively in Q1, Q2 and Q3 last year.

For the whole of last year, there were 989 sub-sale deals, accounting for 4.1 per cent of total transactions. This was up from 3 per cent in 2005 and 2.72 per cent in 2004 - confirming that sub-sale activity is on the rise.

Still, current sub-sale shares are lower than during the two recent property bull runs. In Q2 1996, sub-sales accounted for 28.4 per cent of all transactions of private homes, while in Q3 1999, the figure was 11.1 per cent.

URA has also given a breakdown of unsold private homes from projects with planning approval (either provisional permission or written permission) by location. This shows there were 11,361 unsold homes in uncompleted projects in the core central region at end-Q4 2006, down from 12,958 a quarter earlier.

Developers launched 11,069 private homes last year - comprising 3,850 in the core central region, 4,003 in the rest of the central region and 3,216 in the outside central region.

They sold a total of 4,162 uncompleted private homes in Q4 last year and 10,363 for the whole of 2006 - surpassing the previous high of 9,565 recorded in 1996. The 10,363 units comprised 3,957 in the core central region, 3,751 in the rest of central region and 2,655 in outside central region.

In total, 7,896 private homes were sold in the primary and secondary markets in Singapore in Q4 last year, one of the highest quarterly figures ever.

Click here for the URA's press release