Resale prices of Singapore non-landed private residential properties picked up slightly in September after a previous tepid month, while volume of sales inched down further from August, according to monthly figures from real estate portal SRX Property released on Tuesday.
Overall condominium resale prices rose 0.8 per cent in September from a year ago.
All regions also saw higher prices year on year. The core central region (CCR) posted the biggest increase of 1.8 per cent, followed by the suburbs or outside central region (OCR) which recorded a 0.6 per cent rise. Prices in the city fringes or rest of central region (RCR) were up 0.2 per cent.
Month on month, overall condo resale prices also edged up, gaining 0.2 per cent from August, when prices had been flat from July.
During Q3, the average of the SRX resale price index dropped by 0.6 per cent quarter on quarter. In contrast, the Urban Redevelopment Authority’s (URA) flash estimate for its Q3 price index for non-landed private homes moved in the opposite direction – rising 1.7 per cent from Q2, continuing a steady price recovery.
“This could indicate a decoupling of prices in the primary and secondary private housing markets,” said Nicholas Mak, head of research and consultancy at ERA Realty. The URA price index measures the overall private residential property price trend, including both the primary and secondary markets.
“The price downtrend in the secondary market as shown by SRX’s resale index means that prices in the primary market would have increased significantly, resulting in the growth in the overall residential property price index, as shown by the URA’s Q3 data,” Mr Mak said.
This decoupling of prices in the primary and secondary markets is expected to continue in 2020 as new residential projects are launched at new benchmark prices. For the whole of 2019, the overall private housing price index is forecast to rise by 2 to 2.5 per cent year on year, while the resale price increase would also increase, but by a more modest 1 to 1.5 per cent year on year, Mr Mak noted.
In terms of volume of sales, 743 condo units were resold in September, down 1.5 per cent from 754 units transacted in August, according to SRX data.
This is the second consecutive month of decline, as volumes had tumbled 13.6 per cent in August amid the Chinese Hungry Ghost Festival or seventh lunar month which lasted from Aug 1 to 29.
Christine Sun, head of research and consultancy at OrangeTee & Tie, said a recurring seasonal pattern had been observed in previous years. “The number of resale transactions had similarly dipped in September (2015, 2016, 2017, 2018) but risen in October (2015, 2017, 2018),” Ms Sun said.
“Buyers will usually return to the market after the seventh lunar month, but it takes time for the sales to be converted. The transactions may only be reflected about two months later,” she added.
ERA’s Mr Mak also pointed out that there were more private residential projects launched in September, which prevented an increase in transaction volume after the Hungry Ghost Festival lull period.
Some of the new condos launched last month included Avenue South Residences, Meyer Mansion, Cuscaden Reserve and Uptown @ Farrer, Mr Mak said.
Year on year, however, resale volumes were 8.5 per cent higher this September, according to SRX.
Volumes also remained healthy as they were 5.2 per cent higher than the average of 706 units resold in the previous 12-month period starting from September last year.
On a quarterly basis, transactions have risen since Q3 2018, after cooling measures were implemented in July 2018. Based on advanced estimates using SRX data, the total condo resale volume for Q3 2019 may reach 2,378 units, surpassing the 2,336 transactions inked in Q2 2019, OrangeTee’s Ms Sun said. However, Q3 2019’s volume is still lower than those in Q1 and Q2 last year before the cooling measures were implemented. There were 3,742 units and 4,302 units resold in Q1 2018 and Q2 2018 respectively.
The bulk of condo resale volumes in September came from the suburbs or OCR, which accounted for more than half (53.1 per cent) of transactions. The city fringes or RCR made up 28.2 per cent of volume, while 18.7 per cent came from the CCR.
The two most expensive condo units resold last month were located in the CCR, with both changing hands at S$32 million. One was in TwentyOne Angullia Park, which transacted at S$4,146 per square foot (psf), while the other at 3 Orchard-By-The-Park was resold for S$4,638 psf.
In the RCR, the costliest unit resold was in the Caribbean at Keppel Bay, at S$6.3 million. Meanwhile, the highest transacted price in the OCR was S$3.5 million, for a unit at Mandarin Gardens.
SRX’s overall median transaction over X-value (TOX) was negative S$10,000 in September, implying that buyers were underpaying for resale condos by that amount. In August, TOX was also negative S$10,000.
TOX measures how much a buyer is overpaying (positive value) or underpaying (negative value) for a property based on SRX’s computer-generated market value. The data only includes districts with more than 10 resale transactions.
The highest median TOX was recorded at District 9’s Orchard and River Valley, with a positive S$54,000 value. This was followed by District 10’s Tanglin, Holland and Bukit Timah with positive S$30,000 TOX.
The lowest median TOX was seen in District 12’s Balestier and Toa Payoh at a negative S$45,500, followed by District 5’s Buona Vista, West Coast and Clementi with negative S$40,000.