Prices of completed private residential properties in the central region of Singapore has inched higher in the month of July 2016, suggesting that prices in this market segment may be bottoming out.
According to the transactions recorded in July, prices rose by 0.7% from June, followed by its 0.9% increase from May. However, the numbers are still 1.3% lower year-on-year (y-o-y).
At the other end of the property market, prices of properties in the non-central region (or mass market) declined by 2.3% y-o-y, based on statistics by the NUS SRPI (Singapore Residential Price Index).
It was mentioned by property experts that prices in the central region are seeing signs of stability and there are buyers who have been on the sidelines for the last 2 years. While some buyers are still waiting for property prices to decline further, some have already returned to the market – especially for those who are looking to invest on a long-term basis in the luxury property segment.
In the prime districts (mainly 9 and 10), property developers have been introducing numerous payment schemes to attract prospects, such as OUE Twin Peaks, Hilltops and D’Leedon, resulting in the surge in transaction numbers.
Despite having the Hungry Ghost Festival in August, the transaction volume are still better as compared y-o-y.
It was also noted that while the prices of small unit types were largely unchanged in the month of July, they have declined the most from last year – recording a 4.4% drop.
The significant drop in price is mostly due to the more subdued demand for smaller resale units as compared to new launch condo or apartment units – which accounted for 78% of the total sales of small unit types by the end of July.
Market watchers have attributed the disparity in numbers between both market segments to new launch projects’ ability which presents more opportunities that are meeting the needs of buyers who are looking for smaller residential units.
It was mentioned that ‘cash-rich’ buyers are not looking to be caught off-guard by any tweaks to the Additional Buyer’s Stamp Duty (ABSD) and with the cash reserves they have, most of them have decided not to hold out for property cooling measures to be lifted.