The Urban Redevelopment Authority (URA) and Housing and Development Board (HDB) yesterday released flash estimates for private home and resale flat prices for the second quarter of 2013.
URA estimates that the overall private residential property index climbed 1.7 points quarter-on-quarter to 214.9 in Q2, reflecting a slight increase of 0.8 percent.
Private home prices in the Core Central Region (CCR) slipped 0.2 percent in Q2, compared to a 0.6 percent uptick in Q1, while the Rest of Central Region (RCR) maintained its 0.2 percent growth rate seen in the previous quarter. On the other hand, private home prices in the Outside Central Region (OCR) rose 3.0 percent in Q2, compared to the previous 1.4 percent growth.
“The continued climb in private home prices suggests that market fundamentals have not been overly compromised by the cooling measures as they are still able to generate sufficient sales momentum to thrust prices forward. Certainly, the various sweeteners dangled by developers to entice and encourage commitment by buyers also helped to prop up home prices,” stated Mohamed Ismail, CEO of PropNex Realty.
Meanwhile, the HDB Resale Price Index (RPI) for Q2 2013 is at 206.5. This represents a modest growth of 0.5 percent from Q1 – the lowest quarter-on-quarter growth since Q1 2009.
According to Ismail, this slowdown in growth could be attributed to the reduced Mortgage Servicing Ratio (MSR) from 50 to 30 percent, affecting affordability.
“Demand has also been sapped by the release of new BTO flats, as a result, the resale market is effectively serving only the upgraders and permanent residents now, resulting in the weakening of price and volume of transactions,” he added. The large pipeline also created a ‘balancing effect’ in the secondary segment.
“Overall, HDB resale price growth for the entire 2013 will be at approximately three percent,” Ismail noted.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, wrote this story. To contact him about this or other stories email romesh@propertyguru.com.sg
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