Singapore private home prices fall 0.6% in third quarter; analysts expect more weakness ahead

The anaemic property market continued to bear the brunt of cooling measures as private property home prices fell for a fourth straight quarter. -- ST PHOTO: ALPHONSUS CHERN
The anaemic property market continued to bear the brunt of cooling measures as private property home prices fell for a fourth straight quarter. -- ST PHOTO: ALPHONSUS CHERN

SINGAPORE - The anaemic property market continued to bear the brunt of cooling measures as private property home prices fell for a fourth straight quarter.

Private home prices slipped 0.6 per cent in the third quarter of this year, according to flash estimates from the Urban Redevelopment Authority today.

Overall, the private residential property index shed 1.3 points to 208.1 points in the third quarter of 2014, down from 209.4 points in the previous quarter.

This represented a smaller decline compared with the 1 per cent fall in the second quarter.

Developers have been quick to react to the cooling measures by dangling discounts at new home launches to lure buyers in the past three quarters.

But the third quarter's decline - though the gentlest in four quarters - have brought overall home prices down by 3.8 per cent compared to the same period a year ago, going by today's flash estimates.

Mr Nicholas Mak, who is the research head at property agency SLP International, said he expected prices to take another beating but was surprised at the slower pace of decline.

"Sales have been very slow in the third quarter," said Mr Mak.

But he added that the final verdict is not yet out as the updated figures that will be released at the end of October could still differ.

Analysts warned that the weakness in the market is likely to deepen further, as long as the cooling measures remain in place.

But until that happens, Mr Mak noted that private home prices could register quarterly dips between 0.5 to 1.5 per cent.

In all market segments, prices of condo units lost ground, though at a slower clip compared with the second quarter.

Homes in the prime central areas, which have been the hardest hit of all housing segments, led the decline. Their prices fell 0.9 per cent, compared with the 1.5 per cent decline in the second quarter.

Prices of mass-market homes in the suburbs fell 0.2 per cent, compared with the 0.9 per cent decline in the previous quarter.

The prices of city-fringe units fell 0.1 per cent, against the 0.4 per cent decline previously.

As for landed properties, prices fell 1.7 per cent, following the 1.7 per cent decline in the previous quarter.

The continued weakness in the property market had showed up in earlier data showing only 432 new private condo units were sold in August. This was down from the 509 units moved in July, and was the poorest showing since December when just 259 units were sold.