Resale private home transactions plunge 70.2%

The number of resale transactions in the non-landed private home market plunged 70.2 per cent in January compared to a year ago.

Analysts attributed the decline to the effects of cooling measures and loan curbs introduced last year.

According to the latest data from the Singapore Real Estate Exchange (SRX), which compiles data from property agencies in Singapore, 310 private homes were resold in January this year compared with the 1,039 resale deals closed in January 2013.
Property agents said 310 is the lowest monthly figure in five years.

Compared to December 2013, the resale volume was down 9.1 per cent.

Though transaction volumes dropped, resale prices climbed 2.3 per cent in January.

Analysts said there were probably more higher priced units that were transacted in January. This pushed prices up slightly.

PropNex CEO Mohamed Ismail said: "It also demonstrates one thing, that the market has found its footing where the sellers are reluctant to sell any lower than before.

"And this is because the new launches are not going any cheaper either, (as) the land bid prices in recent months have been relatively strong. Therefore there isn't any motivation for sellers to lower prices any lower."

SRX said prices of suburban homes rose 2.4 per cent last month, followed by those in the city which rose 2.1 per cent.

However, resale prices of private homes in the city fringe fell 0.9 per cent.

Analysts said home prices are likely to remain fairly muted this year. PropNex expects overall prices to either decline by 2 per cent or rise marginally, with support from the mass-market homes segment.

Volume-wise, some agents believe this year's resale volume could come in lower than the 6,608 units transacted in 2013, which is significantly lower than the 13,214 units moved in 2012.

The resale market typically accounts for about one third of overall transactions and it's not expected to record strong numbers this year. For 2014, analysts still expect the demand to be driven by new home launches in the suburban areas.

Meanwhile, overall rental prices rebounded 1.1 per cent in January, after falling for six months.

All three regions saw rental price gains in January. Rentals in the city fringe area rose 3.6 per cent. This was followed by a 0.4 per cent increase in the city area. Rentals in the suburban areas saw a 0.2 per cent gain.