Private home prices up 2.1% in third straight quarterly gain

The eCO @ Bedok South condominium. Private home prices increased 2.2 per cent last year, less than the 2.7 per cent gain in 2019. The 2.1 per cent fourth-quarter rise in prices was driven mainly by homes in the rest of central region, where values rose 4.8 per cent, and the core central region, up 3.3 per cent. ST PHOTO: ALPHONSUS CHERN

Private home prices defied the pandemic-induced recession to rise again in the final three months of 2020 – the third consecutive quarter of increase.

The price index climbed 2.1 per cent in the final three months of last year, well ahead of the 0.8 per cent increase in the third quarter, noted Urban Redevelopment Authority flash estimates yesterday.

This was the steepest quarterly increase since the second quarter of 2018, when private home prices rose 3.4 per cent before cooling measures hit in July that year.

The bigger picture was not so robust with private home prices increasing 2.2 per cent for 2020, less than the 2.7 per cent gain in 2019.

The fourth-quarter increase was driven mainly by homes in the rest of central region, where values rose 4.8 per cent, and the core central region, up 3.3 per cent.

Prices in the outside central region advanced 1.7 per cent, the same as the previous quarter.

The rest of central region led the way last year as a whole, with prices up 5.1 per cent, followed by the outside central region at 3.1 per cent, while values in the prime core central region fell 0.2 per cent compared with 2019.

Some new project launches in the fourth quarter could have boosted prices, said Ms Christine Sun, head of research and consultancy at OrangeTee & Tie.

The median price of new units was $2,137 per square foot (psf) at The Landmark near Outram Park MRT station, and $2,171 psf at The Linq@Beauty World in Upper Bukit Timah, both well above the $1,813 psf median price for all new condominium units in the rest of central region last year.

Ms Sun noted that prices have also increased at many condo projects, such as Treasure at Tampines, Jadescape and Forett at Bukit Timah.

She expects overall private home prices to rise by 1 per cent to 4 per cent this year, while prices at new projects could increase from 2 per cent to 5 per cent.

“Buyer sentiment may pick up further on the growing vaccine optimism and phase three reopening. A number of blockbuster launches could be released in the luxury and city fringe areas, which may uplift the overall price index,” Ms Sun noted.

Ms Tricia Song, Colliers International’s research head for Singapore, said developers sold 2,381 new private homes – excluding executive condos – in the last three months of 2020, down 32.3 per cent from the third quarter and a marginal 2.5 per cent decline year on year.

This should bring full-year new sales to 9,760 units, down 1.5 per cent from 9,912 in 2019, she added.

Sales in the secondary market were more resilient in the fourth quarter, down just 5.6 per cent quarter on quarter but up 36.9 per cent year on year. This brought full-year secondary sales to 9,905 units, up 7.2 per cent from 9,238 in 2019, said Ms Song.

Huttons Asia research head Lee Sze Teck said up to 20 new launches can be expected in the first quarter of this year, with around 9,000 new units hitting the market.

“Selling prices are expected to edge up because of recent firm land tender prices and higher construction costs because of Covid-19 safety management measures,” he said.

“Source: [Private home prices up 2.1% in third straight quarterly gain] © Singapore Press Holdings Limited. Permission required for reproduction”

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