Singapore condo resale prices edge up in Sept; volume drops again

Singapore

RESALE prices of Singapore non-landed private residential properties picked up slightly in September after a previous tepid month, while volume of sales inched down further from August, according to monthly figures from real estate portal SRX Property released on Tuesday.

Overall condominium resale prices rose 0.8 per cent in September from a year ago.

All regions also saw higher prices year on year. The core central region (CCR) posted the biggest increase of 1.8 per cent, followed by the suburbs or outside central region (OCR) which recorded a 0.6 per cent rise. Prices in the city fringes or rest of central region (RCR) were up 0.2 per cent.

Month on month, overall condo resale prices also edged up, gaining 0.2 per cent from August, when prices had been flat from July.

During Q3, the average of the SRX resale price index dropped by 0.6 per cent quarter on quarter. In contrast, the Urban Redevelopment Authority's (URA) flash estimate for its Q3 price index for non-landed private homes moved in the opposite direction - rising 1.7 per cent from Q2, continuing a steady price recovery.

"This could indicate a decoupling of prices in the primary and secondary private housing markets," said Nicholas Mak, head of research and consultancy at ERA Realty. The URA price index measures the overall private residential property price trend, including both the primary and secondary markets.

"The price downtrend in the secondary market as shown by SRX's resale index means that prices in the primary market would have increased significantly, resulting in the growth in the overall residential property price index, as shown by the URA's Q3 data," Mr Mak said.

This decoupling of prices in the primary and secondary markets is expected to continue in 2020 as new residential projects are launched at new benchmark prices, Mr Mak noted.

In terms of volume, 743 units were resold in September, down 1.5 per cent from 754 units transacted in August, according to SRX data.

This is the second consecutive month of decline, after volumes tumbled 13.6 per cent in August amid the Chinese Hungry Ghost Festival which lasted from Aug 1 to 29.

Christine Sun, head of research and consultancy at OrangeTee & Tie, said a recurring seasonal pattern was observed in previous years. "The number of resale transactions likewise dipped in September (2015, 2016, 2017, 2018), but rose in October (2015, 2017, 2018).

"Buyers usually return to the market after the Hungry Ghost month, but it takes time for the sales to be converted. Transactions may only be reflected about two months later."

ERA's Mr Mak also pointed out that there were more private residential projects launched in September, which prevented an increase in transaction volume after the Hungry Ghost Festival lull.

Some of the new condos launched last month included Avenue South Residences, Meyer Mansion, Cuscaden Reserve and Uptown @ Farrer.

Year on year, however, resale volumes were 8.5 per cent higher this September.

The bulk of condo resale volumes in September came from the OCR, making up 53.1 per cent of transactions. The RCR accounted for 28.2 per cent of volume, while 18.7 per cent came from the CCR.

The two most expensive condo units resold last month were in the CCR, with both changing hands at S$32 million. One was at TwentyOne Angullia Park, transacting at S$4,146 per square foot (psf), while the other, at 3 Orchard By-The-Park, was resold for S$4,638 psf.

SRX's overall median transaction over X-value (TOX) was negative S$10,000 in September, implying that buyers were underpaying for resale condos by that amount. In August, TOX was also negative S$10,000.

TOX measures how much a buyer is overpaying (positive value) or underpaying (negative value) for a property based on SRX's computer-generated market value.

The highest median TOX was recorded at District 9's Orchard and River Valley, with a positive S$54,000 value. The lowest median TOX was seen in District 12's Balestier and Toa Payoh at a negative S$45,500.