Private home market close to bottom: Experts

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Property sector on cusp of recovery, with private home prices falling by just 0.1%

Home hunters who may have been sitting on the sidelines waiting for prices to bottom out should now start thinking seriously about taking the plunge, said analysts. They believe the private home market is close to the bottom after nearly four years of sliding prices.

The same goes for the public housing market, which is picking up pace, analysts added.

The second quarter saw 6,001 Housing Board resale transactions, the highest recorded since the second quarter of 2013.

Private home prices fell by 0.1 per cent overall in the second quarter, showed Urban Redevelopment Authority (URA) data out yesterday.

This was the slimmest decline in 15 straight quarters of falls, and is seen as a sign that the market is on the cusp of recovery. It was a much slower fall than the 0.4 per cent dip in the previous quarter.

The figure beat URA's earlier flash estimate of a 0.3 per cent decline.

Mr Desmond Sim, CBRE Research's head for Singapore and South- east Asia, said prices have hit rock bottom.

"The market has achieved another data point of a minute price correction, which further reinforces the point that the trough of the market is here."Mr Desmond Sim, head of CBRE Research for Singapore and South-east Asia

He noted: "The market has achieved another data point of a minute price correction, which further reinforces the point that the trough of the market is here."

Prices of non-landed properties slid 0.1 per cent following a flat first quarter, while landed property prices fell by 0.3 per cent after a 1.8 per cent dip in the first quarter.

Ms Christine Li, Cushman & Wakefield's director of research, said the number of unsold private residential units has been decreasing since the third quarter of last year.

"The drop in unsold stock to 8,459 units from 10,335 units in the first quarter represents a decline of 18 per cent quarter on quarter, the fastest pace since the second quarter of 2012," she said.

The sleepy resale market was also roused, posting a 70 per cent surge from the first quarter to hit 3,698 transactions.

The rental market remained soft, as rentals of private homes slipped 0.2 per cent - but this was a much slower decline than the first quarter's 0.9 per cent fall.

The public housing market largely mirrored the private, with a surge in transactions and easing rates of decline in prices.

HDB resale prices dipped 0.1 per cent for the second quarter, an improvement from a 0.5 per cent in the previous quarter. There were 6,001 resale transactions in the second quarter, up 32.5 per cent from the first.

A price recovery looks imminent, but analysts were split on when it would be.

Mr Nicholas Mak, head of research at ZACD Group, predicted an upswing in prices next year, with developers testing the market with higher launch prices.

Most analysts agree that there is momentum in demand.

Developers sold 3,077 private homes, not counting executive condominiums, in the second quarter - higher than the 2,962 shifted last quarter.

Mr Ong Teck Hui, JLL's national director of research and consultancy, noted that there were 12,107 private homes sales in the primary and secondary markets in the first half of the year, a surge of nearly 64 per cent from the same period last year. He forecasted that a total of 25,000 units would be sold this year, surpassing last year's 22,719 units.

Mr Ong said: "Buyers have been flocking back to the market. This trend is expected to continue into the second half of the year, with demand remaining upbeat as buyers try to catch the market before it turns around."