Resale Prices of Resale Private Apartments down in May

Resale Prices of resale private apartments down in May amid weak transaction volumes, flash estimates from the Singapore Real Estate Exchange (SRX) show.

SRX said its Singapore Property Index (SPI) for resale prices for non-landed private residences eased 0.5 per cent to 175.7 last month from April.

In April, it had edged up 0.1 per cent from March.

Eugene Lim, key executive officer at ERA Realty, said the stable trend shows the latest round of cooling measures in January have been "effective in engineering a soft landing for property market prices".

The index was dragged down by 0.5 per cent in the Core Central Region (CCR) and 0.4 per cent in the Rest of Central Region (RCR). This was offset by a gain of 0.3 per cent for resale prices from Outside Central Region (OCR).

"There is still a slight pent-up demand from first-time buyers especially in mass market," Mr Lim said.

The steady prices came even as transaction volumes stay weak.

The SRX figures showed that 666 resale non-landed private homes changed hands in May.

While the final volume is projected to be around 750 units, which would be higher than the 671 units from April, this is still about 40 per cent lower than the 1,292 units sold in May last year.

ERA's Mr Lim said new sales appeal to buyers as they are purchasing for investment and capital appreciation.

He expects sales volume to decline "moderately" in the coming quarters as pent up demand is gradually met with more supply coming onstream, combined with the effects of the cooling measures.

As for rentals, SRX data showed the index fell for the fourth straight month in May, losing 0.6 per cent from April.

The OCR segment led with a 1.1 per cent drop, followed by CCR's 0.7 per cent decline and RCR with a 0.4 per cent fall.

This was attributed to an abundant supply of homes both completed and in the pipeline. "Competition for tenants will increase and rents may continue to soften this year as more projects are completed," Mr Lim said.

Source: Business Times –8June 2013