Private resale prices drop after short-lived rebound

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http://www.straitstimes.com/archive/...bound-20140730

Private resale prices drop after short-lived rebound

Published on Jul 30, 2014 1:42 AM

By Melissa Tan


RESALE prices of private homes slid back last month after a surprise rebound that turned out to be short-lived, new data out yesterday showed.

Prices dropped 1 per cent in June from May, which consultants said reflected the continued softness in the resale market.

The price falls, outlined in the Singapore Residential Price Index flash estimates, were heaviest in the central region.

Analysts said this fall may have been caused by a growing supply of unsold private homes there.

In general, school holidays last month plus World Cup fever could have distracted buyers from looking for resale homes that month, consultants said.

The slide last month came after prices unexpectedly rose a revised 0.4 per cent in May from the previous month, which consultants had dismissed as a possible blip.

That surprise rise in May turned out to be milder than the initial estimate of a 0.8 per cent increase.

"The price increase for completed properties in May was not sustainable," said R'ST Research director Ong Kah Seng.

"Sellers are cutting prices, especially for properties put up for resale prior to June."

Completed private homes in the central region suffered the biggest price drop last month, falling 1.5 per cent from May.

This reversed the 0.5 per cent gain in central region prices from April to May.

Consultants said that the threat of an oversupply of private homes and a weak leasing market were deterring buyers from taking the plunge, particularly in the city centre.

There were 1,412 completed but unsold private homes at the end of last month, according to Urban Redevelopment Authority figures.

A majority of those were in the city centre.

Completed private homes in the suburbs saw resale prices slip 0.4 per cent from May to June, after having risen 0.3 per cent from April to May.

Those figures exclude shoebox units of up to 506 sq ft, where prices also sank 0.4 per cent last month from the previous month.

Prices of shoebox units had increased 0.4 per cent in May from April.

The price fall signals that owners of completed shoebox units are no longer able to rely on strong leasing demand for small apartments to ask for high prices from investors, Mr Ong said.

The index, compiled by the National University of Singapore, tracks a basket of 429 completed projects across the island, including newer ones such as Marina Bay Suites, Reflections at Keppel Bay and The Interlace.

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http://www.straitstimes.com/archive/...d-may-20140701

Resale prices of private homes rebound in May

Published on Jul 1, 2014 1:16 AM

By Melissa Tan


RESALE prices of private homes staged a surprise rebound in May over April, reversing a nine- month decline, but experts say to keep the bubbly on hold.

They warn that investors remain wary, and the unexpected price bounce does not signal a sustained recovery.

Overall resale prices climbed 0.8 per cent from April to May, according to Singapore Residential Price Index flash estimates out yesterday.

They had fallen 1 per cent from March to April as new launches drew buyers away from completed homes.

Consultants yesterday said May's price rise could have just been a blip, pointing out that the resale market largely remained stagnant. Resale prices are likely to have fallen or stayed flat from May to June, they added.

"Prices fell moderately in April. So the net effect is that prices are relatively flat for now," said ERA key executive officer Eugene Lim.

"There is still a mismatch of expectations between sellers and buyers, and sellers are not under pressure to cut prices."

R'ST Research director Ong Kah Seng said the increase in May was "very marginal", which signalled that investors remained cautious about the investment potential of completed homes.

"May's average price increase should be read as a 'one-off' monthly price increase, especially following months of consecutive price decreases."

Mr Ong also cited "more buoyant mid-year economic and property buying activity" in general.

SLP International research head Nicholas Mak noted that buyers could have gained confidence in the resale market in May due to relatively strong sales of new homes that month.

Developers sold 1,470 new units, almost double the 749 moved in April.

The increase in private home resale prices in May was largely the same across the board.

Central region values rose 0.7 per cent from April to May, after having dipped 0.1 per cent from March to April.

Prices In the suburbs picked up 0.8 per cent in May after tumbling 1.9 per cent in April from March.

These figures exclude resale prices of shoebox units of up to 506 sq ft. They posted a 0.8 per cent gain in May from April after falling 1 per cent in April from March.

The index, compiled by the National University of Singapore (NUS), tracks a basket of 429 completed projects across the island, including newer ones such as Marina Bay Suites, Reflections at Keppel Bay and The Interlace.

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