Resale home price rises slowing

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Sep 28, 2010
Resale home price rises slowing

Sales of new homes also reported to be quiet over weekend
By Joyce Teo, Property Correspondent

Prices of private resale homes are continuing to hit record highs, although the pace of increase has generally continued to slow this quarter, according to a report by property consultancy DTZ.

Over the rest of the year, this weakening growth is likely to grind to a halt as recent government measures to cool the residential market take effect, it said.

'Sales volume is expected to be lower as sellers continue to maintain their asking prices while potential buyers hold out for lower prices.'

The DTZ report said resale prices of suburban leasehold homes increased by 2 per cent to $660 psf in this third quarter.

This compares with a 4 per cent rise in the second quarter, which took prices to $648 psf. The 2007 peak for these homes was $615 psf.

In the new homes market last weekend, sales were generally fairly quiet, as buyers may have been distracted by the Singapore Grand Prix, said an industry source.

NV Residences in Pasir Ris sold another 35 units, lifting total sales to 335 out of 380 launched units, said a City Developments Ltd (CDL) spokesman.

It sold 50 units the previous weekend and 90 units over the Hari Raya weekend.

The 642-unit condo had sold 160 units at its Sept 8 preview despite the Aug 30 cooling measures having kicked in by then.

The CDL spokesman said a 'good mix of all types' of homes were sold and that there had been no change in price. CDL had earlier raised the price by 1 to 2 per cent from $830 psf on average.

Over in Leonie Hill Road, Overseas Union Enterprise could not provide a sales update for its 99-year leasehold Twin Peaks project launched about a week ago.

But executive chairman Stephen Riady said he is confident of selling the 462-unit project, where homes are sold on a fully furnished basis.

The firm released 70 units for sale last weekend - the number needed to cover construction costs. It sold half of them, achieving prices of $2,890 psf.

Another 12 units are booked, having been reserved two months ago by buyers wanting to delay their decisions because of the cooling measures, he said.

The DTZ report said resale freehold condo prices in prime districts 9, 10 and 11 rose 1.4 per cent to touch $1,513 psf, slowing from a 2.6 per cent rise in the second quarter as well-heeled investors remained cautious about the growth of major economies in the West.

Still, the price level is already above the previous 2007 record of $1,483 psf.

Luxury condos - the only segment where prices are still just below the 2007 peak - also saw a slower rise, of 1.6 per cent quarter-on-quarter, to $2,630 psf.

The landed homes segment, which has seen robust growth since the second quarter of last year, was not spared the slowdown, DTZ research shows.

Prices of prime freehold landed homes rose by 2 per cent quarter-on-quarter to $1,611 psf, compared with the 3.3 per cent growth clocked up in the second quarter of this year.

Outside the prime districts, landed home prices inched up by 1.7 per cent to $952 psf. But this rise means these prices have, for the first time, surpassed the high of $943 psf recorded during the 1996 boom, DTZ said.

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