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Singapore Q2 private home prices up 0.8%, easing from 3.3% growth in prior quarter
PRIVATE home prices in Singapore increased 0.8 per cent in the second quarter of this year, slowing from 3.3 per cent in the previous quarter, due to tighter restrictions in a bid to curb the pandemic.
A flash estimate earlier this month from the Urban Redevelopment Authority (URA) had put the figure initially at 0.9 per cent.
Analysts had said at the time that the tightened restrictions during the previous Phase 2 (Heightened Alert), which took place from May 16 to June 13, contributed to the slower pace of growth.
With this, overall private home prices have risen by 4.1 per cent in the first half of this year, and could increase by 6 to 7 per cent for 2021 as a whole on the back of sales for new projects launched in the primary market, according to PropNex. However, some launches poised for July, such as The Watergardens at Canberra and executive condominium (EC) Parc Greenwich, have been postponed due to the latest restrictions which kicked in from July 22 and will last till Aug 18.
Ismail Gafoor, chief executive of PropNex, said: “Looking at the relatively strong sales in 1H 2021, we remain optimistic that transactions this year will surpass the figures garnered in 2020. We are projecting new home sales to likely come in at 11,000 to 12,000 units (excluding ECs), representing a 10 to 20 per cent increase from 9,982 units last year.” In the resale market, PropNex forecasts that over 16,000 homes may be resold in 2021 – up from 10,729 resale properties transacted in 2020.
According to the latest data released by the URA on Friday, prices of landed properties pulled back by 0.3 per cent in the second quarter, reversing a 6.7 per cent increase in the prior quarter. “After a strong run-up in prices in 1Q 2021, some landed home owners raised their asking prices, putting themselves out of reach for some buyers, resulting in a pullback in prices in 2Q 2021,” said Huttons Asia’s senior director of research Lee Sze Teck.
Meanwhile, prices of non-landed homes rose 1.1 per cent, compared to a 2.5 per cent increase previously.
In the Core Central Region (CCR), prices were up 1.1 per cent, versus a 0.5 per cent increase in Q1. Prices of non-landed homes in the Rest of Central Region (RCR) edged up 0.1 per cent, easing from a 6.1 per cent increase previously, while prices of non-landed properties in Outside the Central Region (OCR) rose 1.9 per cent, faster than the 1.1 per cent increase in the previous quarter.
URA’s data also showed that rents of private homes climbed 2.9 per cent in the second quarter, from 2.2 per cent in the previous quarter, as rents of both landed and non-landed homes rose. Still, the vacancy rate dipped 0.1 percentage point to 6.3 per cent.
Nicholas Mak, head of research and consultancy at ERA, noted that the pandemic has given the rental market a boost as construction activities have been disrupted, prompting some households to rent while waiting for their properties to be completed.
“The strongest rental growth is in the OCR at 3.6 per cent quarter on quarter. Many of the buyers of suburban condominiums are HDB upgraders. Since the start of the pandemic in January 2020, about 40 per cent of the uncompleted private housing sold were located in the OCR,” said Mr Mak.
During the second quarter, developers launched 2,356 uncompleted private homes (excluding executive condominiums or ECs) for sale, much fewer than the 3,716 units launched in Q1. In the quarter under review, they sold 2,966 private homes, down from the 3,493 units sold in the previous quarter. Some 413 EC units were launched for sale in Q2, and developers sold 495 EC units during the quarter.
Resale transactions picked up steam with 5,333 resale transactions in Q2, which made up about 63 per cent of all sale transactions. In comparison, 4,519 resale units were transacted in the previous quarter.
Meanwhile, the number of unsold units continues to tick lower. As at the end of the second quarter, there was a total supply of 47,097 uncompleted private homes (excluding ECs) in the pipeline with planning approvals, compared with 48,139 units in the previous quarter. Of this, 19,384 units remained unsold as at the end of the second quarter. The supply of EC units in the pipeline stood at 4,113, of which 1,671 EC units remained unsold.
Source: https://www.businesstimes.com.sg/real-estate/singapore-q2-private-home-prices-up-08-easing-from-33-growth-in-prior-quarter