Sep 26, 2013
Despite lower transaction volumes, prices of resale private
homes remained flat in Q3 as the Total Debt Servicing Ratio (TDSR) begins to
bite, revealed a DTZ report.
Notably, the TDSR framework has lengthened the loan
application process, hindering multiple property owners from investing further
or purchasing residential properties.
At the same time, sales of new private homes (excluding ECs)
fell to 1,224 units in Q3 from 4,538 in Q2.
Over in the secondary market, sales volumes continued to
decline in Q3 with 1,227 units sold, down from 2,405 units in the previous
quarter and 4,358 units in Q3 2012.
Resale prices stayed unchanged across all non-landed private
residential segments in Q3 despite lower sales, based on a basket of existing
properties monitored by DTZ Research.
Prices of freehold resale condominiums in prime districts 9,
10 and 11 were flat after posting a 1.0 percent gain in the first half of 2013,
while resale prices of luxury condominiums remained unchanged for five
consecutive quarters. In suburban areas, resale prices of leasehold condos were
also flat after posting a 2.2 percent hike in 1H2013.
“As the TDSR measures limit the amount of loans buyers can
take, they are now more selective in their purchases even as they have more
choices. Demand will therefore gravitate towards developments that offer buyers
better value such as those that are competitively priced or projects that are
well-located with easy access to amenities,” noted Margaret Thean, Executive
Director, Residential at DTZ.
“Looking ahead, resale transaction volume is likely to
remain weak as the TDSR measures and the earlier cooling measures continue to
work their way through the market. There is limited incentive for individual
sellers to sell their properties unless they receive a premium as their
replacement cost is now higher. In the absence of any major economic shocks,
they are also unlikely to sell their properties in distress. Nonetheless, some
downside pressure on resale prices could be expected going forward, against the
backdrop of a strong pipeline supply and lower launch prices of new projects,”
said Lee Lay Keng, Research Head at DTZ Singapore.
Info courtesy -
PropertyGuru.com.sg
