November prices of built condos up 1.9%

After lagging for most of this year, prices of completed private apartments and condos in Singapore's Central Region sprang to life in November, latest data from the National University of Singapore showed.

Its November flash estimate for the Singapore Residential Price Index (SRPI) series showed that the sub-index for the Central Region (excluding small units) rose 2.6 per cent from October.

This is double the 1.3 per cent gain over the same period posted by SRPI's sub-index for Non-Central Region (excluding small units).


NUS's Institute of Real Estate Studies (IRES), which minted the SRPI series, defines the Central Region as Districts 1-4 (including the financial district and Sentosa Cove) and the traditional prime residential districts of 9, 10 and 11.

The Central Region outperformed even the sub-index for small units (up to 506 sq ft) islandwide, which appreciated 1.7 per cent month-on-month in November.
Overall SRPI for November was up 1.9 per cent from the previous month.

The SRPI series tracks prices of completed private apartments and condos but excludes executive condos, which are a public-private housing hybrid.

Asked about the sharp spike in Central Region prices in November, associate professor Lum Sau Kim of IRES told The Business Times that based on the transaction activity for the 370 projects in the NUS SRPI basket, there has been an increase in the proportion of turnover coming from the Central Region (excluding small units) of late.

"For example, Central Region units comprised about 25 per cent of the total volume in January 2012, but the proportion has now increased to around 35 per cent in October and November.

We've noted a positive correlation between volume and price change as measured by the NUS SRPI. So we're probably seeing the same behaviour now (in Central Region)," she said.

Despite its sharp month-on- month gain in November, the Central Region has posted the weakest year-to-date increase of 0.4 per cent of the four SRPI sub-indices, reflecting a relatively weak showing in the January to October 2012 period versus December last year.

Prof Lum said that following the announcement of the additional buyer's stamp duty on Dec 7 last year, the SRPI for Central Region recorded its biggest monthly declines of 2.8 per cent for January and 3.1 per cent in February this year.

She cautioned that the 2.6 per cent monthly rise for the Central Region sub-index based on the November 2012 flash estimate was likely to be revised next month when more data is received. "It's too early to say if this rising trend will likely continue."

Year-to-date, the Non-Central Region has been the star performer, with the sub-index for the region appreciating 8 per cent. This outpaced an increase of 6.3 per cent for small units and the marginal 0.4 per cent rise for the Central Region.

Yesterday, IRES also released revised data for October, which showed month-on-month gains of 1.2 per cent for the Non-Central Region, 0.9 per cent for small units and 0.4 per cent for the Central Region.

Source: Business Times –29 December 2012