SINGAPORE — Resale prices of non-landed private homes rose 0.6 per cent last month from December, flash estimates from SRX Property showed today (Feb 11), but the gain was achieved on very low volume and analysts said the housing market will remain under pressure for the rest of the year because of economic uncertainty, a demand-supply imbalance and rising mortgage rates.
More buyers will also turn to the resale market this year, he added, following the tapering of housing units released under the Government Land Sales programme, which means fewer new private residential units are expected to be launched. Upcoming executive condo include The Visionaire EC , Wandervale EC and Parc Life EC while existing ones include The Terrace EC, Brownstone EC, Waterwoods EC, Signature at Yishun, Skypark Residences, The Vales EC, The Criterion EC, Bellewaters EC, Bellewoods EC.
Last month’s price rebound from the revised 0.5 per cent decline in December was led by gains in the Core Central Region, or city centre, where prices rose 1 per cent.
Meanwhile, prices inched up 0.1 per cent in the Rest of Central Region, or city fringes, and rose 0.8 per cent in the Outside Central Region, or suburbs. The number of units resold slumped to an estimated 364 units last month from 455 units in December due to the seasonal lull ahead of Chinese New Year.
Mr Eugene Lim, key executive officer at property agency ERA, said: “Although prices posted a slight increase in the month of January, the overall trend for the year should still be downwards.
“This is because overarching issues continue to press on the property market. The economy is facing headwinds, and the rental market continues to face downward pressure due to a supply and demand mismatch as the economy is restructuring to be less reliant on foreign manpower.
“In addition, in view of rising interest rates and the weak rental market, owners of multiple properties bought before the imposition of the Total Debt Servicing Ratio framework (in June 2013) might find themselves forced to dispose of some properties if they are unable to continue servicing their mortgages,” he added.
On a year-on-year basis, resale non-landed private home prices fell 1.7 per cent last month from January 2015 and were down 7.2 per cent from the market’s recent peak in January 2014. While last month’s transaction volume was a 20 per cent slump from December, it still represented a 3.7 per cent increase from January 2015.
“Usually buying activity tends to be sluggish in the month before Chinese New Year, and will generally pick up momentum in the months after,” said Mr Lim.
Market sentiment, as indicated by SRX’s Transaction-Over-X-Value (TOX), deepened to negative S$10,000 last month from negative S$5,000 previously, showing that buyers continued to have the upper hand, said Mr Lim.
More sellers are probably willing to lower their asking prices in view of the weak market, he added.