The rate of increase in property prices has continued to moderate, with private home prices rising just 0.2 percent in Q4, lower than the 1.3 percent increase seen in the previous quarter, according to latest figures released by the Urban Redevelopment Authority (URA).
“This moderation in private property prices can be attributed to the multiple rounds of cooling measures implemented by the government that have controlled excessive speculation which in turn has slowed the movement of prices and helped genuine buyers,” said Tejaswi Chunduri, PropertyGuru’s real estate analyst.
For the whole 2011, prices of private homes increased by almost six percent, significantly lower than the 17.6 percent increase recorded in 2010.
Meanwhile, prices for non-landed homes in the Core Central Region (CCR) rose 0.5 percent, while those in the Rest of the Central Region (RCR) and Outside the Central Region (OCR) increased 0.1 percent and 0.6 percent respectively, significantly lower than the 1.2 percent and 2.1 percent rise in the previous quarter.
Meanwhile, HDB resale prices rose only 1.7 percent in Q4 from the 3.8 percent increase in Q3. Overall, resale flat prices jumped by nearly 11 percent in 2011, although it is still less than 2010’s 14 percent increase.
“Although lesser than the price increase in 2010, one of the main reasons for this high 11 percent hike in prices is the disproportionate supply-demand ratio that has pushed prices up,” said Chunduri.
She noted that 2012 could prove to be another turning point (after similar trends were seen in Q3 2000 and Q3 2008), as market conditions remain uncertain.
“We could see a probable slowdown in the market, strongly supported by the quarter over quarter decelerating growth in the URA’s Property Price Index till Q4 2011.”
Source : PropertyGuru – 27 Jan 2012