Too soon to say Singapore private home price declines are slowing down: Experts

Condominium buildings in the Singapore city centre.
Condominium buildings in the Singapore city centre. PHOTO: ST FILE

SINGAPORE - Private home prices may have fallen at a slower pace last year than in 2014 but the trend of quarterly price decline is expected to continue, and future declines may not be as small, experts said.

They were responding to flash estimates from the Urban Redevelopment Authority (URA) on Monday (Jan 4), which showed that private residential property prices were down an estimated 0.5 per cent in the fourth quarter of last year, taking the full year decline to 3.7 per cent. In 2014, prices fell 4.0 per cent during the year.

There were fewer transactions in the fourth quarter and these were largely from new sales, where home prices were propped up by relatively high land prices, said Mr Desmond Sim, CBRE head of research for Singapore and South-east Asia.

"There were generally no very large discounts across the board for the new sales market," he noted.

New launches in the fourth quarter included Principal Garden, The Poiz Residences and Thomson Impressions.

These were all in the city fringes, where prices of non-landed private homes were unchanged in the quarter.

Prices of non-landed private homes in the core central region fell 0.4 per cent in the fourth quarter, while prices of those in suburbs were also unchanged.

Mr Eugene Lim, ERA Realty key executive officer, noted that while the price decline seemed to be slowing down last year on a month-on-month basis, there are several uncertainties going forward.

"Apart from the impact of a slowing economy, if an interest rate rise gathers pace, it may force more people to be under pressure, especially those highly geared with a few property loans, or who are depending on the rental market to help them service their loans," he said.

Although there were signs of interest rates rising last year, most people could still absorb the impact at the time. "However, we noticed that in the resale market, sellers tend to be more negotiable now," said Mr Lim.