January's cooling measures clip rise in private home prices in the first quarter

THE pace of growth in private home prices moderated in the first quarter, preliminary data from the Urban Redevelopment Authority shows.

Prices rose just half a percent from the fourth quarter of 2012 as government cooling measures that were introduced in January kicked in.

Price increase of non-landed private homes in thhe city centre slowed to 0.4 per cent compared to 0.7 per cent in the previous quarter.

City fringe area saw zero growth, compared to 0.9 per cent previously.

Suburban prices saw the strongest growth, at 1.7 per cent. Even so, it was less than half the growth of the last quarter, which climbed by 3.8 per cent.

OrangeTee's head of research and consultancy, Ms Christine Li, said the numbers were expected because the latest round of cooling measures were quite punitive on demand.

This led to develpers lowering their prices for new launches.

"In the resale market, transaction volume plunged in the first quarter of this year as individual sellers are not as flexible as developers who are able to give discounts to lure buyers back to the showrooms," she noted.

Prices in the high end market could see further moderation when the final first quarter data is released at the end of the month, she said.

The URA preliminary numbers typically capture only transactions in the first 10 weeks of a quarter.