Prices of mass market condos in Singapore have been edging up, as the NUS Singapore Residential Price Index (SRPI) rose 14.1 percent year-on-year in April for the Non-Central Region and 5.6 percent year-on-year for the Central Region, which covers districts 1 to 4 and 9 to 11.
The index, which tracks prices of completed private homes, rose one percent to an overall value of 162.4 points.
According to a report by The Business Times, market analysts said the newest figures reflect the primary or developer sales market, where condos in suburban areas have led price increases for private homes over the past two years.
Generally, property players do not expect prices of mass market condos to continue increasing at the same pace. An early indicator showed a slight pullback in buying sentiment, since the monthly household income cap for buyers purchasing new Built-to-Order (BTO) flats increased from S$8,000 to S$10,000.
Many analysts also expect the income cap for those purchasing Design, Build and Sell Scheme (DBSS) flats and executive condos to increase to approximately S$12,000, from the current S$10,000.
Joseph Tan, Executive Director (residential) at CB Richard Ellis (CBRE), said the increase in supply of new entry level and mass market private condos from land sold at state tenders will likely see more muted increases for the rest of this year.
He noted that a major reason for the price increases and strong sales in the past two years has been the developer’s strategy of developing small units, which can be sold at higher psf prices.
“One-bedroom units can sell well if they’re priced below $600,000-650,000, while three-bedders of about 1,050 sq ft can move if their prices don’t exceed $1 million.”
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