CCR best performer for condo resale prices

THE Core Central Region (CCR) looks set to be the outperformer again this year for resale prices of private apartments and condos.

Based on flash estimates for November 2016 released by SRX Property on Tuesday, its price index for resale transactions of non-landed private homes in CCR is up 1.8 per cent from December last year.

In contrast, over the same period, SRX’s price indices eased 0.6 per cent in the city fringe or Rest of Central Region (RCR) and 1.8 per cent in the suburbs or Outside Central Region (OCR), with the overall resale price index for non-landed private homes down 0.5 per cent.

Last year, too, prices in the CCR outperformed the market, with a 2.7 per cent gain, followed by a 1.4 per cent increase for RCR and a drop of 4.3 per cent in OCR; overall resale prices for non-landed private homes retreated 2.1 per cent in 2015.

SRX Property’s latest data also showed that resale transaction volumes for private apartments and condos from January to November 2016 totalled 7,021 units – higher than the 5,938 units in 2015 and 4,645 units in 2014.

OrangeTee’s head of research and consultancy Wong Xian Yang said demand in the resale market this year was buoyed by improving sentiment in the residential property market as well as a better matching of price expectations between buyers and sellers.

“Notably, a portion of resale deals, about 500-600 units, may be attributed to developers’ sales in delicensed projects. That said, the number of units resold by those who bought earlier has also gone up this year,” he said.

While the market continues to face persistent headwinds including potentially higher interest rates, a lacklustre private residential rental market, property cooling measures and tepid economic growth, improving sentiment and increased demand will likely keep prices stable, he said.

“Based on the Monetary Authority of Singapore’s Financial Stability Report 2016, the housing loan non-performing loan (NPL) ratio and share of housing loans in arrears remain relatively low. Notably, these indicators have been on the rise since 2013. As such, pockets of opportunity should continue to appear in the resale market for buyers, but resale prices on a whole are expected to remain stable,” said Mr Wong.

Barring unexpected hikes in interest rates or further government interventions, overall resale prices may bottom out in 2017, he added.

SRX’s latest numbers also showed that its overall resale price index for non-landed private homes rose 0.3 per cent month-on-month in November 2016. This contrasts with a 0.7 per cent month-on-month decline in the index for October 2016.

Last month’s rise in the index came on the back of price gains of 0.5 per cent in the CCR and 0.4 per cent in the OCR. However, prices were unchanged in the city fringe or RCR.

Year-on-year, the overall November resale price index was down one per cent from November 2015. The sub-indices for RCR and OCR posted year-on-year declines of 1.5 per cent and 2.6 per cent respectively. In contrast, the sub-index for CCR climbed 2.3 per cent over the same period.

The overall price index for November 2016 was down 8.3 per cent from the peak in January 2014.

SRX estimated that 581 non- landed private homes were resold last month – a drop of 8.8 per cent from the 637 units in October 2016 but 21.3 per cent higher than the 479 units resold in November 2015.

Last month’s resale volume was 71.7 per cent below the peak of 2,050 units in April 2010.

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