Private property price index up 1.3% in Q2: URA flash estimate

Prices of non-landed private residential properties rose by 1.5 per cent in the Core Central Region compared to the 3 per cent fall in the previous quarter.
Prices of non-landed private residential properties rose by 1.5 per cent in the Core Central Region compared to the 3 per cent fall in the previous quarter. PHOTO: ST FILE

SINGAPORE - Price increases in apartments and condos in Singapore's city centre and city fringe helped lift the private property price index by 1.3 per cent in the second quarter of 2019 according to a Monday (July 1) flash estimate.

This comes after a 0.7 per cent decrease in the previous quarter. Based on the flash estimate on Monday, prices have risen 0.6 per cent year to date.

Prices of non-landed private residential properties rose by 1.5 per cent in the Core Central Region (CCR) compared to the 3 per cent fall in the previous quarter. As for the Rest of Central Region (RCR), prices rose by 3 per cent after registering a decline of 0.7 per cent in the previous quarter.

Prices in the Outside Central Region (OCR) increased by 0.5 per cent, following the last quarter's 0.2 per cent increase.

OrangeTee & Tie's head of research and consultancy Christine Sun said: "This uptrend is within expectation as new homes sales currently form the lion's share of the property market and many new projects are selling at new benchmark prices for their locations in recent months."

According to her analysis of Realis data, 367 new homes in RCR were sold at $2,000 per square foot (psf) and above in the second quarter of 2019. In comparison, 31 units were sold in the first quarter of 2019.

As for CCR, 69 units were sold above $3,000 psf last quarter as opposed to the 45 units sold in the previous quarter.

 
 
 
 

CBRE's head of research for Singapore and South-east Asia Desmond Sim did a caveat analysis comparing the first half of this year and the first half of last year and pointed out that new home sales were fairly stable at 3,874 units in H1 2019, versus 3,688 units in H1 2018, while there was a significant reduction in resale volume from 7,146 units to 3,266 units.

JLL's senior director of research and consultancy Ong Teck Hui said: "The key observation from the second quarter 2019 flash estimates is the firm demand for new high-end homes in CCR as well as attractive locations in RCR in spite of the cooling measures, which do not seem to deter buyers who are keen on such properties. This should augur well for potential launches with such attributes as there is a fair chance of them achieving better sales take-up."

These estimates were compiled based on prices given in contracts submitted for stamp duty payment and data on units sold by developers up till mid-June.

They will be updated on July 26.

The URA said that past data have shown that the difference between the quarterly price changes indicated by the flash estimate and the actual price changes could be significant when the change is small, and the public therefore is advised to interpret the flash estimates with caution.

Analysts were split on price direction moving forward. CBRE's Mr Sim believes the price index upturn is a mere blip, and will remain "relatively stable with downward pressure coming only in the mid to long term" because of uncertain global economic forecasts and rising inventory from yet-unlaunched projects.

Meanwhile, OrangeTee & Tie believes in a price increase of between 1 and 3 per cent for the whole of this year, and Morgan Stanley's analyst Wilson Ng expects price growth to be "sustained".