Certificate of entitlement (COE) prices ended lower across all categories in the latest tender yesterday, in spite of a lower COE supply till October.
The COE premium for cars up to 1,600cc and 130bhp ended at $31,917, down 2.47 per cent from $32,725 in the previous tender.
The COE price for cars above 1,600cc or 130bhp closed at $38,602, down 3.5 per cent from $40,001 previously.
The premium for Open COEs, which can be used for any vehicle except motorcycles, finished at $40,002, down 1.26 per cent from $40,512 previously.
The commercial vehicle COE price closed at $26,501, down 4.67 per cent from $27,800 previously.
The motorcycle COE premium ended at $4,301, down 2.25 per cent from $4,400 previously.
The drop in prices came even as supply cuts to COEs kicked in this month.
The quota for cars up to 1,600cc for the August-October period - at 2,112 certificates a month - is nearly 26 per cent smaller than that for the preceding three months.
The quota for cars above 1,600cc is almost 9 per cent smaller at 2,083 a month.
The Open category quota is 5 per cent smaller at 709 a month.
Mr Neo Nam Heng, chairman of diversified motor group Prime, said that under normal circumstances, prices of COEs would have risen due to the quota cuts.
"This shows that the market is a bit sick, I think people are worried about the economy," he said, noting that business appeared to be slower at many showrooms in the past two weekends.
"I think the prices will stabilise around this level in the midterm."
Mr Neo added that the weaker Singapore currency in the past two months also played a part in lowering prices, especially for cars above 1,600cc (Category B).
"The unfavourable exchange rate means that dealers have to pay more to bring cars in, and this would leave them with less margin to bid higher for COEs," he said.
"For the larger cars above 1,600cc, the difference in payment could go up to $15,000, so the prices for Cat B have weakened."