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URA private home price index rises 3.1% in Q1 2018, steepest q-o-q gain since Q2 2010
THE Urban Redevelopment Authority's (URA) overall private home price index rose 3.1 per cent in the first quarter of this year over the preceding quarter, based on a flash estimate released on Monday morning.
This marks the steepest quarter-on-quarter hike since Q2 2010, when the index rose 5.3 per cent.
The index posted quarter-on-quarter gains of 0.8 per cent in the fourth quarter of 2017 and 0.7 per cent in Q3, after hitting bottom in the second quarter of last year.
The index is now up 4.6 per cent from a year ago.
The URA said that prices of non-landed private residential properties increased by 5.0 per cent in the prime area or Core Central Region (CCR) in the first quarter, compared with the 1.4 per cent increase in the previous quarter.
In the city fringe or Rest of Central Region (RCR), prices rose 1.1 per cent, after posting a gain of 0.4 per cent in the previous quarter.
Prices in the suburbs or Outside Central Region expanded 3.8 per cent, following a 0.8 per cent increase in the previous quarter.
Prices of landed residential properties went up 1.8 per cent in the first quarter, after rising 0.5 per cent in the previous quarter.
Commenting on the Q1 indices, ERA Realty Network key executive officer Eugene Lim said: "These are very positive numbers we are seeing, indicating that a market recovery is well on track.
"With almost all the cooling measures still in place, this indicates very positive market sentiment, and the market is on an upswing trend."
Mr Lim also opined that more buyers are purchasing now for fear of bigger price increases ahead. "This coupled with more opportunistic sellers who are revising their prices upwards could have contributed to the higher-than-expected price increase in Q1 2018."
PropNex Realty chief executive Ismail Gafoor said: "Moving into 2018, we can feel that buyers and investors are now taking action, propelled by the ongoing market exuberance with the bullish land bids and continuous collective sales in the market.
"With price appreciation expected to continue this year, we predict that not only transaction volumes will pick up, but prices are set to increase by up to 5 per cent as well by the first half of the year."
ZACD Group executive director Nicholas Mak said: "Most of the homebuyers and sellers observed the ever-increasing land prices paid by developers in the past year and deduced that future residential property prices will be significantly higher. As a result, some sellers have increased their asking prices, while some buyers are eager to buy before further increase in prices."
The positive sentiment in the private residential property market that contributed to the healthy primary market sales and the en bloc sale fever in the first quarter is likely to continue for the rest of the year, he added.
Mr Mak expects URA's overall private home price index to rise by 8 to 15 per cent for the whole of this year.
ERA's Mr Lim predicts an 8 to 10 per cent rise.
Mr Ismail of PropNex, who has the same forecast, added: "The price growth will be mainly contributed by higher price points at new launches which will in turn bring up the overall selling prices of the resale and existing launches."