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MOST property consultants say that the Urban Redevelopment Authority's second-quarter flash estimates signal that a bottoming out in private home prices is fast approaching.
This, coupled with the recent improvement in private home sales, also means that the authorities would be inclined to delay any easing of the property cooling measures. Some agents are also hoping that Brexit could help divert some property buying interest to Singapore.
URA's benchmark overall private home price index eased 0.4 per cent in Q2 over the preceding quarter, a smaller drop compared with the 0.7 per cent fall in Q1.
The latest decline is also the smallest of the 11 consecutive quarterly decreases in the index since it peaked in Q3 2013.
URA's Q2 flash estimate translates to a 1.1 per cent index drop in the first half of this year (Q2 2016 vs Q4 2015).
The price index for non-landed private homes in Core Central Region (CCR) rose for the second straight quarter - inching up 0.2 per cent in Q2 after increasing 0.3 per cent in Q1.
"This could indicate a 'flight to value'," said Desmond Sim, CBRE Research head of Singapore and South-East Asia, "which may continue and eventually prop up the overall private home price index for the next quarter to hover in the region of zero per cent."
In the city-fringe or Rest of Central Region (RCR), prices of private apartments and condo units appreciated 0.3 per cent in Q2 after remaining unchanged previously.
However, prices of non-landed homes in the suburbs or Outside Central Region (OCR) contracted 0.7 per cent, though this was a smaller decline than Q1's 1.3 per cent.
In the landed housing segment, the price decline gathered momentum, with a 1.3 per cent fall compared with Q1's 1.1 per cent contraction.
JLL national director Ong Teck Hui said: "Based on caveats, 52 per cent of transactions of private homes in Q2 2016 were non-landed ones in CCR and RCR, so one could say that half of the private residential market has improved."
He expects the overall private home price index to post a slight drop in Q3 and stay flattish in Q4 - resulting in a full-year decline of under 2 per cent.
PropNex Realty CEO Ismail Gafoor too predicts an up to 2 per cent decrease in the index this year, led by price drops in the OCR. This would be the smallest annual contraction in three years; the index shed 3.7 per cent last year and 4 per cent in 2014.
Wong Xian Yang, OrangeTee senior manager for research and consultancy, said that CCR prices in Q2 may have been supported by recent developer sales at OUE Twin Peaks and Ardmore Three which are included under "resales" in URA's terminology since these projects are delicensed. "These projects are relatively newer compared with the usual mix of resale transactions - units in older projects sold by individuals - and could slightly uplift overall prices in the CCR."
A housing project may be delicensed if it has received Certificate of Statutory Completion, and where the individual strata titles have been issued to buyers.
Another property consultant suggests that URA's price index for CCR may be slightly inflated as some incentives given by developers of delicensed projects recently may not be captured in the sales data URA uses to compute its price indices.
One outcome of a project being delicensed is that its developer is no longer required to submit weekly sales data to URA (showing discounts and other incentives to reflect the net price).
For new sales, URA uses such data from developers in licensed projects to compute its residential property price indices.
In the case of resale transactions, however, URA uses data collated from records submitted to the taxman for stamp duty payment. An industry player told BT that while upfront discounts given by a developer in a delicensed project to a buyer would still be captured in these records, any incentives granted following the completion of the purchase, that is, after stamp duty payment, would not.
A case in point would be Ardmore Three where developer Wheelock Properties (Singapore) has given buyers a 15 per cent ABSD (additional buyer's stamp duty) rebate on completion of the purchase.
When contacted, a URA spokeswoman said: "Sales of completed private homes by developers in projects which have been delicensed by the Controller of Housing account for a relatively small proportion of all private residential property sale transactions."
For new sales, the majority of units are sold by developers before the projects are completed and delicensed. URA's private home price indices are "intended to provide a broad overview of property price trends, and thus computed based on all property sale transactions, both in the new sale and resale markets", she added.
Analysts attributed the modest price boost in URA's index for RCR in Q2 chiefly to new projects Gem Residences and Sturdee Residences.
Savills Singapore research head Alan Cheong commented that the current "extended downturn in the private home price index in the absence of any crisis is bound to create impatience among potential buyers to return to the market".
Despite the positive sentiment sparked by URA's Friday numbers, market watchers highlight the headwinds still prevailing - such as the cooling measures, the high volume of new private home completions especially in the suburbs and not forgetting the global economic uncertainty, exacerbated by Brexit.
Still, ERA Realty Network key executive officer Eugene Lim spots a silver lining. "With Brexit, Singapore might see more attention from investors who are looking to park their money in a safe haven - and property may well be one of the assets they would consider."
Those in another camp, however, argue that with the pound's depreciation and softer UK property prices, London property is looking more attractive now.