PRIVATE PROPERTY PRICES IN SINGAPORE GROW AT A SLOWER PACE IN 3rd QUARTER.

A Condominium in Singapore

Latest news written by Georgina Joseph from Channel News Asia:

Early signs of impact from the government’s property cooling measures are starting to show in the private residential market.

Private home prices grew in the third quarter but at a slower pace of 3.1 per cent, according to data from the Urban Redevelopment Authority (URA).

And analysts said most of the transactions were recorded before the cooling measures were introduced on August 30.

Home prices continued to rise in the third quarter, due largely to strong sales momentum in July and August.

According to URA estimates, prices of private homes in the mass market and city fringe showed a higher increase of 2.4 percent in the third quarter. This was due to strong take-up for new launches like The Scala, NV Residences and The Greenwich.

However private home prices in the city rose a more moderate 1.6 per cent, due to fewer launches.

But market players said that the market had slowed down from September after the cooling measures kicked in.

Property agents said the sale of private homes dipped by 10 to 20 per cent in the month of September.

Still, experts said the full impact of the cooling measures has not been fully captured in the third quarter estimates.

This is because the flash estimate is compiled based on transactions in the first 10 weeks of the quarter, including the first week of September. Therefore, experts expect the impact to be felt more in the fourth quarter figures.

Going forward, analysts expect prices to continue to moderate.

“Without the policy, we estimated that possibly we would close the year at maybe 16 or possibly 18 per cent. But now with the policy, we are likely to reign in growth to a more sustainable level of 2 to 3 per cent quarter growth, so we should see the full year coming in at about 15 to 16 per cent,” said Chua Yang Liang, head of Research, Southeast Asia, at Jones Lang LaSalle.

While prices are expected to moderate, experts said the flush of liquidity in the market may help prop up demand for private homes.

“Prices will continue at this moderate pace. How long this will last, we would not know. It depends on the liquidity situation. China has increased its measures. So every time they introduce new measures, some of this liquidity can flow down into Singapore,” said Colin Tan, director of Research & Consultancy at Chesterton Suntec International.

For the full year, analysts said total sales of private homes could range between 13,000 and 14 000 units.

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