Singapore condo resale prices see first monthly decline in a year after cooling measures: SRX data

RESALE prices of private non-landed homes in Singapore dipped last month, breaking a 12-month climb to record highs after the latest property cooling measures took effect in July, going by data from real estate portal SRX Property.

Resale prices of condominiums and private apartments declined by 0.2 per cent in August from the previous month, SRX's flash estimates released on Tuesday showed.

Some property market observers were expecting private resale prices to stay in positive territory for the rest of the year, but rise at a slower pace after higher additional buyer's stamp duty (ABSD) rates and tighter loan-to-value limits took effect on July 6.  

The month after the latest property curbs hit also saw a big drop in the volume of transactions. The number of private non-landed homes resold in August fell 35.3 per cent to an estimated 694 units from 1,072 units in July.

Year on year, resale volume last month was 48.2 per cent lower than the 1,339 units moved in August 2017.

Commenting on the data, OrangeTee & Tie research and consultancy head Christine Sun said: "These down trends may be an early indication that resale prices may have peaked in some residential segments and are starting to soften under the current cooling measures. 

With the dip in August, the steep 9 per cent rise in resale prices so far this year has come down slightly to 8.8 per cent. Compared to a year ago, prices are 11.2 per cent higher than in August 2017.

August's drop was felt most by apartments in the city fringes or rest of central region (RCR) which fell 1.6 per cent from July, while those in the prime district, or core central region (CCR), dipped by 0.3 per cent. These are homes more likely to be bought for investment or speculative purposes and on which the higher ABSD rates and loan limits are likely to apply. 

In contrast, resale prices for units in the outlying areas or outside of central region (OCR), which are more likely to be bought by genuine homebuyers, continued on the uptrend, rising 0.8 per cent in August. 

In another indication of the wind coming out of the sails of the resale market, the premium buyers were prepared to pay over market value continued to decline in August after a sharp drop in July, going by another SRX measure.

Its overall median transaction over X-value (TOX) fell to zero last month, after falling to S$4,000 in July from S$17,000 in June, before the latest cooling measures. TOX measures how much a buyer is overpaying or underpaying on a property based on SRX Property's computer-generated market value.

Noting that more than half the districts recorded either zero or negative median TOX, meaning more people sold below valuation, Ms Sun said this "may indicate that the winds have shifted from a seller's to a buyer's market." 

District 20's Bishan and Ang Mo Kio posted the highest TOX of S$25,000, among districts with more than 10 resale transactions. District 4's Telok Blangah and Harbourfront posted the lowest TOX of negative S$37,000.