SINGAPORE — Private home prices in the Republic fell for an 11th consecutive quarter to log the longest losing streak on record, taking the cumulative decline since the peak in 2013 to 9.4 per cent.
The private residential property price index fell 0.4 per cent in the second quarter, compared with the previous three months, showed flash estimates by the Urban Redevelopment Authority (URA) on Friday (July 1).
Although this is a slight improvement over the first quarter’s 0.7 per cent decline, the price drop nonetheless puts the official price index on its longest losing streak since the data was first published in 1975. Upcoming executive condo include Treasure Crest and Northwave EC while existing ones include The Terrace EC, Brownstone EC, The Visionaire EC, Parc Life EC , Waterwoods EC, Signature at Yishun, Skypark Residences, Wandervale EC, The Vales EC, The Criterion EC, The Amore EC, Bellewaters EC, Bellewoods EC.
“This longest period of price declines is significant. It didn’t happen because of market fundamentals or macro-economic conditions; it’s Government-engineered. If the Government didn’t interfere, we would have seen prices climb until we had a bubble forming,” said Mr Nicholas Mak, head of research and consultancy at SLP International Property Consultants.
The almost three-year-long decline comes after prices surged over 60 per cent after the global financial crisis in 2009, prompting the Government to implement repeated rounds of cooling measures and loan restrictions. Amid calls from developers and agents for the measures to be lifted, the Government has repeatedly signalled its reluctance to do so, with Minister for National Development Lawrence Wong saying in April it is “too early to declare victory”.
The latest decline was led by the landed property segment, where prices slipped 1.3 per cent quarter-on-quarter. In the non-landed homes segment, the Outside Central Region (OCR), comprising suburban areas, inched down 0.7 per cent. Prices in the Rest of Central Region (RCR), or the city fringes such as Toa Payoh and Geylang, increased 0.3 per cent, while those in the Core Central Region (CCR), or city centre, rose 0.2 per cent.
Analysts attributed the price improvement in RCR to new projects such as Gem Residences in Toa Payoh and Sturdee Residences near Farrer Park, which were well-received by buyers during the quarter.
In the CCR, sales of homes on the higher end of the luxury spectrum may have helped prop up prices.
“In the second quarter, more prime properties in the higher band of the CCR were sold. A significant portion of those sales were completed projects such as Ardmore Three and OUE Twin Peaks … This could be an indication of ‘flight to value’,” said Mr Desmond Sim, head of CBRE Research in Singapore and South-east Asia.
Despite the improvement, CEO of Century 21 Singapore Ku Swee Yong said there is still weakness in the luxury property segment. He noted that many sales were achieved after “significant discounting”, which is a sign that potential buyers are still cautious.
Potential buyers in the other segments are also expected to continue to be constrained by the property curbs, which would put overall prices on a downtrend for the rest of the year.
Meanwhile, the Housing and Development Board’s (HDB) flash estimate showed resale prices of flats up 0.1 per cent in the second quarter compared with the previous three months. This is a reversal from the 0.1 per cent decline in the first quarter.
“We can safely say that resale HDB prices have stabilised … The vast majority of resale HDB flat buyers are very pragmatic, making their offers to purchase around recently transacted prices so as to ensure the agreed resale price would be supported or matched by the valuation,” said Mr Eugene Lim, key executive officer of ERA Realty Network. “Nonetheless, we may continue to see minor price movements each quarter, possibly around plus or minus 0.3 per cent … Buying demand is expected to remain resilient, as the price stability serves as a magnet to draw buyers.”