In Singapore, private homes’ prices increased after a two-month breaker in the third quarter of 2014, amid the recession induced by the Covid 19 pandemic, as the country reopened in Phase 2.
The total residential home prices index increased by 0.8 percent, higher than the 2nd trimester rise by 0.3 percent, according to flash estimates of yesterday by the Urban Redevelopment Authority (URA).
This leads to a 1% reduction in private home prices in the first quarter of this year and a first trimester fall in a year. Private house prices rose by 0.1% year-to-date.
Once the URA has tightened up developers reissuing a buyer purchasing option (OTP) several times on Monday, the new property snapshot arrives.
In the midst of the worst downturn in Singapore this move is intended to encourage financial prudence by making sure that buyers are eventually unable to commit to new private homes.
Market analysers said that seemingly strong new house sales may have given birth to a slightly diminishing view of the market in the midst of a serious recession over the past few months.
Under the new rules, developers can no longer re-issue an OTP for the same buyer for the same system for 12 months after the original OTP expires.
The Singapore and South East Asian Associate Research Director at Cushman / Wakefield, Mr. Wong Xian Yang said that the home private sector has remained “extraordinarily resilient,” with prices at their highest in the third quarter since 2013.
He claimed that it represented a high demand for private homes and high holding power due to incomparable support from the government for the economy, mitigating sales pain and enabling suppliers to sell prices.
But in the fourth quarter this year, Mr Wong sees a decrease in demand with economic insecurity ahead and a steady upsurge in demand.
Furthermore, the new curbs on the reissue of OTPs would cause a lean back in business operations if consumers adopted a more cautious approach. He said.
“We expect prices to remain flat during 2020 and fluctuate about minus 1% to 1%, given the steady demand push and the winds of industry.”
Ms Christine Sun, Head of Research and Advisory of OrangeTee & Tie, said that central banks around the world have already undergone waves of quantitative easing to stimulate their economies by growing property prices.
“Investor trust has increased by increasing foreign direct investment, in particular by health care companies and tech giants.”
URA data also reported that private house prices increased 3.3% in the third quarter in the suburbs of the town or the remainder of the central area, as opposed to a 1.7% decline in the previous quarter, while prices increased by 1.7% compared with 0.1% in the previous quarter. Prices in the central suburbs increased.
Prices of non-landed private homes were down only in prime areas or the central core region in the third quarter; this fell by 4.9% compared with a 2.7% increase in the preceding quarter.
Based on transaction prices for stamp duty paying contracts submitted and data on the units sold by developers until mid-September, URA ‘s flash estimates are compiled.
On Oct 23, URA shall be updated with its complete set of property statistics for the third quarter.