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30-04-15, 17:27
http://www.straitstimes.com/archive/saturday/premium/top-the-news/story/public-and-private-home-resale-prices-continue-falling-20150425

Public and private home resale prices continue falling

Published on Apr 25, 2015 1:06 AM

By Janice Heng And Rennie Whang


BOTH the public and private property resale markets continued to soften in the first three months of the year, although at a slower pace than before.

Resale prices for both private and public homes fell 1 per cent, a slower decline than in preceding quarters, according to latest official data.

Private home prices tumbled for the sixth straight quarter and are down 5.9 per cent from their peak in the third quarter of 2013, Urban Redevelopment Authority figures showed yesterday.

Private home transactions - including new sale, resale and subsale units - were down 3.8 per cent to 2,655 units, the lowest since the fourth quarter of 2008.

Similarly, in the Housing Board resale market, prices fell for the seventh straight quarter. But the 1 per cent decline was the smallest since the third quarter of 2013, when the downward trend began.

HDB data showed that resale transactions also fell, with 4,135 deals in the first quarter, down 10.8 per cent.

But while both sectors showed slower declines, experts believe the private property market is poised for further falls even as the HDB resale market could stabilise.

The marginal fall in HDB resale prices could even raise "hopes for prices to slowly bottom out", said R'ST Research director Ong Kah Seng.

But OrangeTee research manager Wong Xian Yang cautioned that the HDB resale market still faces downward pressure, with more flats set to hit the market as Build-to-Order flats and executive condominiums are completed.

For HDB resale prices, he estimates a full-year fall of 4 per cent to 7 per cent.

Mr Ong expects a 4 per cent decline, while other experts see falls of up to 5 per cent.

There was more pessimism on the private property front.

Private home rents fell 1.7 per cent in the first quarter, steeper than the 1 per cent fall in the fourth quarter. They are down 5.1 per cent from the peak in the third quarter of 2013.

Rents are expected to continuing falling at a faster pace as a record number of 21,994 private residential units, including executive condominiums, will be completed this year, said Ms Christine Li, research head at Cushman & Wakefield.

The number of unsold inventory - uncompleted units with prerequisites for sale, and completed units - rose 16.4 per cent quarter on quarter to 21,675 homes, said Ms Chia Siew Chuin, director of research and advisory at Colliers International.

"The effects of cooling measures are still working through the market and interest rates have risen, sooner and steeper than expected. People are still waiting for prices to fall and continue to delay entering the market," she said, adding that private home prices may fall between 5 per cent and 8 per cent more this year.

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