Resale private home prices continue to fall

SINGAPORE — Resale prices of completed non-landed private homes continued to fall last month, the Singapore Residential Price Index (SRPI) flash estimates released yesterday showed, as sellers cut prices to keep pace with discounts for new homes, with the sharpest declines seen in non-central areas.

The SRPI, compiled by the National University of Singapore’s (NUS) Institute of Real Estate Studies, showed that overall prices decreased by 1 per cent in April compared with the previous month, slowing from the revised 1.4 per cent decline in March.

Prices of homes in the non-central region, excluding small units, led the decline, falling by 2 per cent last month, compared with the 1.1 per cent drop in March, the SRPI data showed. However, prices of homes in the central region stayed flat after falling 1.8 per cent in March.

Prices of small units — those with a floor area of 506sqf and below — fell 0.6 per cent after a 0.2 per cent decline a month earlier, the data showed.

While property curbs have had an impact across the entire market, weakness in the resale sector also comes as developers have started to offer more competitive prices for new properties.

“With developers giving discounts on new homes to move sales, resale sellers are under pressure to match such moves in price cutting to compete for the same pool of buyers,” said Ms Anne Tong, chief executive officer of HSR International Realtors.

“The drop in private resale prices is (also) due to an oversupply of units, including an influx of resale units from the 2010 and 2011 launches. With more choices for buyers, sellers have to keep prices at an acceptable level to be in line with market conditions.”

However, prices in the central area have remained stable as sellers in the market may not be in a hurry to offload their units, Ms Tong added.

“(Those currently in the market) are those who are not too eager to sell as they have stronger holding power, are not dependent on rental yields and are looking for long-term capital gains.”