The Straits Times | M AY 11, 2013
Only 572 resales were recorded in April, down 54 per cent from the 1,240 in the same month last year.
THE recent cooling measures continue to inflict pain on the resale private home market with prices down and transaction volumes hammered last month.
Analysts say the tough steps imposed in January are prompting buyers to turn their backs on resale units and look to new properties where discounts are being dangled.
The effect has been a slow-motion price slump. They dipped 0.4 per cent last month from levels in March, which in turn were down 2 per cent from February's values.
The plunge in transaction volumes has been far more dramatic.
Only 572 resales were recorded in April, down 54 per cent from the 1,240 in the same month last year. It was also fewer than the 614 units resold in March this year.
Around half of April's resales were in suburban regions, the Singapore Real Estate Exchange said yesterday.
Transactions were not concentrated in any particular area, according to caveats lodged with the Urban Redevelopment Authority.
Projects with resales included Kovan Melody in Hougang where four units were resold at prices ranging from $1,039 to $1,172 psf and Hillview Heights in Bukit Batok which recorded three resales at $1,008 to $1,148 psf.
Analysts point to the dampening effects of January's cooling measures.
ERA Realty key executive officer Eugene Lim said: "Buyers are more interested in new sales as they are newer and they are buying for investment and capital appreciation."
The April price drop was most pronounced in the city centre and city fringe.
Average prices in the city centre fell 1.9 per cent from March to $1,772 psf, after sliding 2 per cent from February to March.
City centre average resale prices have fallen for four straight months after they hit a peak of $1,899 psf in December last year.
In the city fringe, prices dropped 1.9 per cent to $1,267 psf in April after staying flat in March.
The price drops in the city centre and city fringe outweighed a 1 per cent price rise in suburban areas to an average of $1,022 psf.
Average suburban resale prices have hovered above the psychologically daunting $1,000 psf mark since February this year, supported by pent-up demand from first-time buyers, particularly for mass market homes.
Mr Lim said that given the increasing supply of new homes, resale demand is anticipated to slow down further and sales volume is likely to decline moderately in next few quarters.
Overall islandwide rents followed suit last month, slipping 1 per cent from March based on a weighted average.
Both the city fringe and suburban regions recorded rental price declines while rents picked up in the city centre.
The fall was largest in the city fringe, where average rents dropped 4.4 per cent to $3.94 psf per month in April.
Suburban area rents lost a marginal 0.9 per cent to $3.13 psf per month from March.
C&H Properties key executive officer Albert Lu expects suburban rents to bottom out at this level.
City centre rents painted a different picture, rising 2.1 per cent to $4.79 psf per month, which approaches the high of $4.82 psf per month in October 2007.
This boosted city centre rental yields to 3.25 per cent in April.
However, the city fringe still has the highest gross yield at 3.73 per cent as of April, followed by 3.68 per cent in suburban regions.
Mr Lu told The Straits Times that tenants probably chose to move from the city fringe to the city centre after seeing the rental gap narrow in recent months.
In March, city centre average rents were at $4.69 psf per month, only 57 cents higher than average rents in the city fringe.
"Given the small difference, people would probably choose to move to the central region," Mr Lu said.
Martin Koh | 86666 944 | R020968Z
Sherry Tang | 9844 4400 | R020241C
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