Private home prices down for 15th straight quarter; pace of decline eases

Prices fell by 0.1 per cent quarter-on-quarter, compared with the 0.4 per cent decline in the first quarter and the 0.5 per cent decline in the last quarter of 2016.

Prices of landed properties declined by 0.3 per cent in the second quarter, easing from the 1.8 per cent decrease in the previous quarter. Prices of non-landed properties declined 0.1 per cent, after remaining unchanged in the previous quarter, according to URA.

Prices of non-landed properties in the Core Central Region (CCR) decreased by 0.5 per cent, compared with the 0.4 per cent drop in the previous quarter. Prices of non-landed properties in the Rest of Central Region (RCR) increased by 0.6 per cent, while those in the Outside Central Region (OCR) fell by 0.3 per cent.

Commenting on the price declines, ERA’s key executive officer Eugene Lim said: “Overall in H1 2017, prices have only decreased marginally by 0.4 per cent. This is much better than the 1.1 per cent price decrease seen in H1 2016. It looks increasingly certain that the market is nearing its turning point.”

He said that as economic growth remains on track for the 2 to 3 per cent forecast for 2017, and with the Monetary Authority of Singapore recently saying that cooling measures will remain, he expects prices to move “sideways”.

“All in all, we are projecting a zero to 1 per cent price decrease for 2017, much less than the 3.1 per cent decline in 2016,” he said.

RENTALS FALL FURTHER

Rentals of private residential properties also fell 0.2 per cent, after declining 0.9 per cent in the previous quarter, URA said.

Rentals of landed properties fell 0.1 per cent, while those of non-landed properties decreased by 0.2 per cent.

Rentals of non-landed properties in CCR increased by 0.1 per cent, while those in RCR decreased by 0.4 per cent. Rentals in OCR also fell 0.6 per cent.

“Perhaps rents are also reaching their turning point, as we gradually pass the supply peak,” ERA’s Mr Lim said. “In 2018 and 2019, there will only be about 8,400 private residential units completed per year. In comparison, there will be an estimated 16,544 private residential units completed in 2017 alone.

“We should be expecting rents to recover from 2019 onwards,” he said, adding that for 2017, he is expecting a drop of 2 ro 3 per cent.

LAUNCHES AND TAKE-UP

Developers launched 2,011 private homes – excluding executive condominiums (ECs) – during the second quarter, compared with 1,949 units in the previous quarter. A total of 3,077 homes were sold, compared with the 2,962 units sold in the previous quarter.

Developers did not launch any ECs in the second quarter but sold 954 EC units over the period, compared with the 1,024 units launched and 1,072 units sold in the previous quarter.

There were 3,698 resale transactions, compared with 2,170 in the previous quarter. Resale transactions accounted for 53.6 per cent of all sale transactions in the quarter, compared with 41.7 per cent in the previous quarter.

There were 35,423 uncompleted private homes – excluding ECs – in the pipeline, compared with 36,942 in the previous quarter. Taking into account ECs, there were a total of 43,202 units in the pipeline. In total, 17,827 units units were unsold as of the end of the second quarter.