SINGAPORE – Private home prices fell less than initially estimated in the first quarter of 2020, but Singapore’s extended “circuit breaker” period against a sharp rise in Covid-19 cases will put more downward pressure on the property market.
Private residential prices dropped 1 per cent in the January to March period from the previous quarter, according to data from the Urban Redevelopment Authority (URA) on Friday (April 24). This is slightly less than URA’s preliminary estimate of a 1.2 per cent decline at the beginning of April.
The drop comes after three consecutive quarter-on-quarter gains after the market digested the July 2018 property cooling measures, with private home prices last up a modest 0.5 per cent in the fourth quarter of 2019.
Before Singapore’s partial lockdown measures were introduced in the first week of April, then extended and tightened last Friday, analysts were predicting up to an 8 per cent drop in private home prices for 2020 – which would be the first yearly decline since 2016.
According to URA’s final data for the first quarter, prices of non-landed properties declined by 1 per cent, worse than the 0.3 per cent drop in the previous quarter.
Prices of landed homes dropped 0.9 per cent, reversing from a 3.6 per cent increase in the previous quarter.
For prices of non-landed properties by region, those in the core central region fell 2.2 per cent, compared with the 2.8 per cent drop in the previous quarter. Units in the city fringe or rest of central region dipped by 0.5 per cent, compared with the 1.3 per cent fall in the previous quarter.
Prices in the suburbs or outside central region declined 0.4 per cent, compared with the 2.8 per cent increase in the previous quarter.
For the rental market, URA’s data show that rents rose 1.1 per cent in the first quarter of this year, after dropping 1 per cent in the previous quarter. This came as the vacancy rate for private residential units dipped to 5.4 per cent from 5.5 per cent in the prior quarter.
For home sales, developers sold fewer new private units, excluding executive condominiums or ECs – 2,149 in the first quarter of this year, 12 per cent less than the 2,443 units sold in the previous quarter. This came as they launched about 6 per cent fewer units – 2,093 as against 2,226 units previously.
In the bigger resale market, there were 2,080 transactions in the first quarter of 2020, 11 per cent lower than the 2,342 in the previous quarter. Resales accounted for 48.7 per cent of all sale transactions in the period, not much different from 48 per cent in the previous quarter.
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