Overall resale prices climbed 0.8% from April to May, according to Singapore Residential Price Index (SRPI) flash estimates out yesterday.
They had fallen 1% from March to April as new launches drew buyers from completed homes.
Consultants said that May's price rise could have just been a blip, pointing out that the resale market largely remained stagnant. Resale prices are likely to have fallen or stayed flat from May to June.
SLP International research head Nicolas Mak noted that buyers could have gained confidence in the resale market in May due to relatively string sales of new homes that month.
Developers sold 1,470 new units, almost double the 749 moved in April.
The May resale prices increase contrast with that of the 2Q2014 price index for private homes, which continues to see a decline.
The price index for private homes fell 1.1% in the second quarter, the third continuous quarter of price decrease. This is according to flash estimates released by the Urban Redevelopment Authority (URA) today.
Prices of non-landed private residential properties in all market segments declined in the second quarter, the agency said. In the core central region, prices fell 1.5%, higher than the 1.1% decline in the previous quarter. Prices outside the central region decreased by 1.1%, higher than the 0.1% decrease in the previous quarter. In the rest of the central region, prices fell 0.6%, compared with the 3.3% decline in the previous quarter.
Prices of landed properties fell 1.5%, higher than the 0.7% decline in the previous quarter, the URA said.
Sources: ST, CNA
And according to a report in BT today, the average transacted resale price of completed small units of up to 70sqm (753sqft) recorded a price increase of between 3.6 to 6.9% y-o-y across all three regions (i.e. Core Central Region, Rest of Central Region & Outside Central Region). Conversely, the resale price for big units (more than 70sqm) is down between 2.9 to 7.5% y-o-y across all regions.
Since the resale market typically takes its cue from the primary market, and with developers set to continue with their trend of building smaller-sized units in the face of TDSR, the logical conclusion is that resale price of small units may continue to fare better than those of big units... a consideration that potential investors may want to keep in mind.
HOWEVER, the wife and I feel that there will still be good demand potential for big units. There is a limit on how many occupants can comfortably live in an apartment of up to 735sqft, even after taking into consideration the shrinking household size in Singapore. So despite the less than rosy picture seen year-on-year for big units, we expect prices of such to stabilize and eventually rise due to a smaller supply. When will that happen, you ask? Well...THAT is the million dollar question!
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