Business

Private home prices down 0.6% in Q1

URA's flash estimate shows slightly steeper dip than Q4 of last year as cooling measures take their toll

Private home prices eased at a faster clip for a second straight quarter, falling 0.6 per cent in the first quarter of this year from the previous three-month period, according to the Urban Redevelopment Authority's (URA) flash estimate released yesterday.

The 0.6 per cent price drop is slightly steeper than the 0.1 per cent dip in the fourth quarter of last year, as the July 6 cooling measures and macro-economic uncertainty took their toll on buying sentiment.

Ms Christine Li, senior director and head of research Singapore, Cushman & Wakefield, said: "Weaker sentiment will likely persist in the near term.

"There is a steady stream of new launches in the pipeline due to the five-year additional buyer's stamp duty (ABSD) deadline, which means buyers are also spoilt for choice."

Based on caveats registered to-date in URA Realis, there are 3,215 transactions of private homes in the first quarter, a sharp 40 per cent year-on-year drop from 5,328 recorded a year ago, JLL Singapore's senior director of research and consultancy Ong Teck Hui noted.

The price decline in the first quarter of this year was due to a 1 per cent fall in the prices of non-landed condominiums and private apartments, which had edged up 0.5 per cent in the previous quarter.

Giving a breakdown by location, prices of non-landed homes fell 2.9 per cent in the prime areas or core central region (CCR), the sharpest quarterly drop for prime areas since a 5.2 per cent fall in second quarter 2009 in the aftermath of the global financial crisis, analysts said. This is compared with a 1 per cent drop in the fourth quarter of last year.

Compared with the other sub-markets, the prime districts have been most affected, as the increase in ABSD rates dampened demand from investors and foreigners.

Ms Tricia Song, head of research for Singapore, Colliers International, said: "The decrease in Q1 non-landed CCR prices was much steeper than our expectation... The decline in median prices for certain projects could have contributed to the sharper drop as developers seek to clear inventory in ongoing launches."

This included Marina One Residences, Martin Modern, New Futura and TwentyOne Angullia Park, she said.

The only bright spot was the landed segment, where prices defied gravity and gained 1.1 per cent over the previous quarter, following a 2 per cent fall in the fourth quarter.

Ms Li cited the perception that "on a per square foot basis, the landed segment was still a value-for-money play".

Property