More private homes resold as prices fall

[reporter2]

http://www.straitstimes.com/archive/tuesday/premium/top-the-news/story/more-private-homes-resold-prices-fall-20140513

More private homes resold as prices fall

Published on May 13, 2014 1:23 AM

By Melissa Tan


MORE buyers jumped into the private home resale market last month as prices slipped to their lowest point in 16 months.

There were 476 non-landed private homes resold in April, the best figures since October last year, the Singapore Real Estate Exchange (SRX) said in a flash estimate yesterday.

Home-seekers appeared to be responding to what seems to be an emerging buyer's market.

An expected influx of completed homes and stiff competition among sellers for a shrinking pool of buyers has hit prices, with analysts tipping that the trend will continue all year.

Resale prices slipped 1.7 per cent from March to April to reach their lowest point since December 2012.

The price drop, combined with the larger number of transactions, suggests more sellers have caved in and lowered prices.

"Sellers have become more realistic," said ERA Realty key executive officer Eugene Lim. "Buyers may also have been attracted back to the resale market by the lower prices due to a slower private resale market."

PropNex Realty key executive officer Lim Yong Hock said some owners may have decided to sell now rather than risk even lower prices later, with a bumper crop of new homes due in the next two years.

Although the number of units that changed hands on the resale market last month was 25 per cent higher than in March, it was still lower than the 649 units resold in April last year.

Resale prices in the city fringe fared the worst last month, tumbling 3.6 per cent from March. That was followed by the city centre with a 2.3 per cent drop over the same period.

Analysts put the declines down mainly to softer leasing demand and reduced interest from investors after home loan curbs.

Rents rose a marginal 0.2 per cent last month after reaching a 27-month low in March, the SRX said yesterday.

Developers have been cutting prices for new projects to move units, meaning sellers of older, completed homes have had to lower asking prices to compete.

However, resale prices in the suburbs eked out a 0.4 per cent increase from March to last month. R'ST Research director Ong Kah Seng said this was likely just a blip.

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[reporter2]

http://www.businesstimes.com.sg/archive/tuesday/premium/singapore/private-non-landed-prices-16-month-low-20140513

Published May 13, 2014

Private non-landed prices at 16-month low

Transaction volume in April goes in the opposite direction with 24.6% rise

By andrea soh

[email protected] @AndreaSohBT


IN an indication that sellers are becoming more realistic about reduced demand, resale prices of non-landed private homes slipped 1.7 per cent in April, touching a 16-month low since December 2012.

This was despite the increase in volumes of resale transactions, which at 476 was 24.6 per cent higher than March's level, flash estimates by the Singapore Real Estate Exchange (SRX) showed. This also suggested that buyers are moving back into the resale market as prices stabilise, said market observers.

"It was the highest resale volume since October 2013, which means buyers and sellers are getting used to the market with all the measures in place," said ERA Realty key executive officer Eugene Lim.

Prices in the Rest of Central Region (RCR) led the decline with a 3.6 per cent drop, while those in the Core Central region (CCR) fell 2.3 per cent. Prices Outside Central Region (OCR) crept up 0.4 per cent.

The price declines in regions where homes are on a higher price band show that sellers have become more realistic about prices with some buyers affected by loan curbs, said Mr Lim.

It also reflects continued weakened investor interest for completed properties in CCR, with ample unsold developer stock and weak leasing demand, said R'ST Research director Ong Kah Seng. "Companies continue to cut back on expatriates' housing allowance even though US and EU economic conditions are stabilising," he said. "Senior expatriates are also opting for less luxury rental apartments in the prime districts."

Both noted that developers are pricing their new launches lower to be more buyer friendly.

SRX data showed that rental prices edged up 0.2 per cent after reaching a 27-month low last month, driven by an increase in the RCR region. They are still down by 5.4 per cent compared with the peak in January 2013

Transaction volume in the rental market was flat month-on-month, though it increased 9.8 per cent from a year earlier.

"As the economy restructures to be less reliant on foreign labour, we can expect rentals to further moderate by some 5 per cent by year-end," said ERA's Mr Lim. "As more newly completed private homes are put up for rent, an increase in competition is expected; this is expected to put a lid on rental prices in the months ahead."

Meanwhile, the overall median transaction over X-value (TOX), which measures how much people pay over the recent transaction prices, remains negative at minus $20,000 for the non-landed private resale market in April.

"This means more than half of all non-landed private property buyers pay below recent transaction prices for their units in April," said SRX.

Mr Ong expects resale prices to continue slipping for the rest of the year as investors expect a seasonal slowdown in leasing activity in second-half 2014.

"Savvy investors will make an opportunistic purchase earliest only around end-2014, in order to tap increased expatriates requirements and lease renewals in the early part of 2015," he said.

[stalingrad]

Where is Teddy when I need someone to laugh at?

Seriously, don't worry. The cooling measures will be removed when you see a 10% decline. Asian governments have no will power.