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PRICES of completed condominiums in Singapore inched up 0.1 per cent in September from the previous month, the National University of Singapore's flash estimates for its Singapore Residential Price Index (SRPI) released on Wednesday showed.
Though this broke a streak of five straight months of price declines from April this year, coming after a 0.7 per cent month-on-month drop in August based on a revised index value, it was hardly enough evidence to alter the views of market watchers who believe downward pressures on private residential prices will continue.
Completed condos here have registered month-on-month price declines for nine out of the past 12 months, going by the SRPI.
Last month, the 0.4 per cent and 0.3 per cent price rebounds posted by small units of up to 506 square feet and the non-central region units (excluding small units) were widely seen as a temporary blip. Both segments posted price declines of 0.1 per cent and 0.8 per cent in August, respectively.
Prices of completed units in the central region (excluding small units) - defined as Districts 1 to 4 and the traditional prime Districts 9, 10 and 11 - posted a 0.4 per cent drop last month, following a 0.3 per cent decline in August.
The NUS SRPI tracks a fixed, pre-determined basket over time - hence taking into account first-time sales and a larger proportion of resales - and uses hedonic regression to estimate prices.
Calling the price increase of small units in September "a random occurrence", R'ST Research director Ong Kah Seng explained that there is overall instability in this segment given the surge in completions of small units since last year.
HDB flat owners who bought shoebox units but have kept them vacant for a year or so since their completion will likely resell them at breakeven prices or small profits, and are increasingly open to lowering their price expectations going forward, Mr Ong said.
Prices of completed properties in the non-central region are also expected to be on a general monthly price decline or stagnation due to increased suburban condominiums completing and intensifying leasing competition, he said.
ERA Realty key executive officer Eugene Lim attributed the marginal price increase in completed units in non-central areas to the lack of major project launches in September, which turned homebuyers' attention to the resale market.
But on the whole, small price fluctuations are to be expected for the coming months, depending on what types of properties get transacted. "With the looming number of completions coupled with the cooling measures that the government is keeping unchanged currently, the downward pressure on property prices is expected to continue into 2016," he said.
Mr Ong felt that the long-drawn episode of marginal trimming of prices so far may not have met buyers' expectations nor presented significant buying opportunities yet. There is a higher possibility in 2016 for a notable, more drastic price cut of say 5-10 per cent on average in a quarter.
"This blow-out in prices of completed properties could happen in say Q2 2016, or Q3 2016," Mr Ong said. "These will attract opportunistic buyers and prices can rebound quickly after demand significantly improves when prices are cut notably."