Time To Consider New Launch? ST/06April15

Cheryl Ong          
Straits Times
06 April 15

POCKETS OF LIGHT IN GLOOMY HOME MARKET?

THERE has been much doom and gloom in the property market since cooling measures hammered buying sentiment but the pain seems largely restricted to a small segment of the market.

Private home prices have fallen 1.1 per cent from the fourth quarter, according to the Urban Redevelopment Authority’s (URA) property price index released on Wednesday.

The index is compiled from stamp duty data from the Inland Revenue Authority of Singapore.

But new figures from developers and caveats lodged with the Singapore Land Authority showed that not all projects have suffered steep price declines. In fact, some have even managed to eke out respectable gains.

Median prices of projects that racked up at least four transactions in the six months to March 31 were compared with the July to December 2013 period, which was the first six months after tougher mortgage requirements were imposed.

The units did not differ in size by more than 10 sq m. The findings showed that much of the red ink has been restricted to the luxury market, although the additional buyer’s stamp duty and mortgage restrictions have inflicted pain across the board.

“The property price index reflects broad price trends for the entire private housing market, rather than small pockets of the market,” said Mr Sin Lye Chong, URA group director for land sales and administration. “Prices of a few high-end projects may have dropped by about 20 per cent, as cited by industry players, but there are other projects in the city centre that have seen single-digit price falls,” he added.

At Helios Residences, a 140-unit freehold project in Cairnhill Circle, median prices fell 21.9 per cent, from $3,411 per sq ft (psf) in the six months to Dec 31, 2013, to $2,665 psf in the six months to March 31.

The Grange, a 95-unit freehold condo in River Valley, recorded a 21.4 per cent slip in prices to $1,934 psf over the same period.

The declines contrast sharply with the 0.7 per cent fall at RV Residences, also a city-centre condo in River Valley.

Mr Alan Cheong, research head at Savills, said a dip of 1 per cent, as noted by the URA, “is not significant”.

While the URA index does not reflect unsold units, Mr Cheong said the steep discounts offered were real enough to developers.

“They have lowered their prices by 20 per cent and, yet, there are still no takers,” he said. “There’s a disconnect between real prices and virtual prices.”

It was the same picture in the city-fringe areas. The largest dip of 14.4 per cent was recorded at the 510-unit Pebble Bay project in Tanjong Rhu, when prices in the six months to Dec 31, 2013, were compared with the six months to March 31.

However, prices at Cote d’Azur, a 612-unit condominium in Marine Parade, rose by 4.3 per cent.

In the suburbs, the 748-unit Eco in Bedok South registered a slip of 17.1 per cent in the same period but the 483-unit Eco Sanctuary in Chestnut Avenue gained 4.1 per cent.

One reason for the anomalies could be that developers typically release units with better attributes – and higher psf prices – for sale at a later date, pushing up the median prices in some quarters, said Mr Ong Teck Hui, national director of research and consultancy at JLL.

“It will never be the case that all properties in the same basket have dropped their prices.”

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

w

Connecting to %s