Private home prices dip 0.1% in Q4, first decline in 6 quarters; up 7.9% for whole of 2018

Private residential property prices fell by 0.1 per cent in the fourth quarter of 2018.
Private residential property prices fell by 0.1 per cent in the fourth quarter of 2018.PHOTO: ST FILE

SINGAPORE - Government data on Friday (Jan 25) confirmed the first quarterly decline in Singapore’s private home prices since the second quarter of 2017, as the July 6 cooling measures ended a price recovery that lasted only five quarters, the shortest on record.

Private dipped by 0.1 per cent in the fourth quarter of last year, compared with a 0.5 per cent rise in the previous quarter, the Urban Redevelopment Authority (URA) announced, unchanged from its earlier flash estimate.

For the whole of 2018, private home prices rose 7.9 per cent, faster than 1.1 per cent increase in 2017.

Going by segment, prices of landed homes fell by 2 per cent in the fourth quarter compared with a 2.3 per cent increase in the previous quarter. But prices of non-landed properties edged up 0.5 per cent after remaining unchanged in the previous quarter. 

For the whole of 2018, prices of landed homes rose by 6.3 per cent, while those of private apartments and condominiums rose by 8.3 per cent.

Prices of non-landed properties in Core Central Region (CCR) decreased by 1 per cent in the fourth quarter, compared with the 1.3 per cent increase in the previous quarter.

Prices of non-landed properties in Rest of Central Region (RCR) increased by 1.8 per cent, compared with the 1.3 per cent decrease in the previous quarter. Prices of non-landed properties in Outside Central Region (OCR) increased by 0.7 per cent, compared with the 0.1 per cent decrease in the previous quarter.

For the whole of 2018, prices of non-landed homes in CCR, RCR and OCR increased by 6.7 per cent, 7.4 per cent and 9.4 per cent respectively.

OrangeTee & Tie research and consultancy head Christine Sun sees the price growth of new homes slowing significantly this year as cooling measures are still in place and many new launches are expected this year. 

“Many new projects are currently priced at the ‘sweet spot’,” she said. “If the global economy does not deteriorate drastically and the job market remains healthy, overall prices are likely to remain flat or rise marginally this year. 

“Prices may rise marginally for selected areas as land prices of some new projects are relatively high. We estimate that the overall price rise of private residential homes may be between 1 and 3 per cent for the whole of this year.” 

For the fourth quarter, developers sold 1,836 private residential units (excluding ECs), compared to the 3,012 units moved in the previous quarter. 

For all of 2018, new home sales fell 16.8 per cent to 8,795 units from 10,566 units in 2017 - the worst drop since a 6.3 per cent fall in 2012 after the first round of additional buyer’s stamp duty (ABSD). But the 2018 drop in new home sales is not as bad as in 2013, when sales plunged 50.4 per cent year-on-year after the implementation of tighter loan limits and the second round of ABSD. 

“Demand for real estate may continue to hold ground this year. More than 19,000 new homes will be launch-ready this year and we can expect many new homes to offer distinctive unique selling propositions and ‘sweet-spot’ pricing that will likely entice buyers,” Ms Sun said. 

 
 

Meanwhile, developers launched 1,657 uncompleted private homes (excluding ECs) for sale in the fourth quarter, compared with 3,754 units in the previous quarter. For the whole of 2018, developers launched 8,769 uncompleted units, compared with 6,020 units in the previous year.

Developers did not launch any EC units for sale in the fourth quarter. Nevertheless, they sold 29 EC units from previous launches over the period. In comparison, developers did not launch any EC units and sold 84 EC units in the previous quarter. For the whole of 2018, developers launched 628 ECs and sold 1,136 ECs, compared with the 1,555 units launched and 4,011 units sold in 2017.

At the end of 2018, there was a total supply of 51,498 uncompleted private residential units (excluding ECs) in the pipeline with planning approvals, up from 50,330 units a quarter ago. Of this number, 34,824 units remained unsold as at the end of the fourth quarter, up from 30,467 units in the previous quarter.

After adding the supply of 2,834 ECs in the pipeline, there were 54,332 units in the pipeline with planning approvals. Of the ECs in the pipeline, 825 units remained unsold.

In total, 35,649 units with planning approvals (including ECs) remained unsold, up from 31,295 units in the previous quarter.

Based on the expected completion dates reported by developers, 10,312 units (including ECs) will be completed in 2019. Another 4,960 units (including ECs) will be completed in 2020.

Apart from the 35,649 unsold units (including ECs) with planning approval as at the end of 2018, there is a potential supply of 9,800 units (including ECs) from Government Land Sales (GLS) sites and awarded en-bloc sale sites that have not been granted planning approval yet. They comprise (a) about 6,500 units from awarded GLS sites and Confirmed List sites that have not been awarded yet, and about 3,300 units from awarded en-bloc sale sites.