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Private home prices up 1.8% in Q2 from previous quarter: URA
By Matthias Chan, Channel NewsAsia | Posted: 28 July 2006 1802 hrs

Home prices in Singapore rose by more than earlier estimates in the second quarter.

Numbers from the Urban Redevelopment Authority show that residential prices increased by 1.8 percent in the second quarter of this year from the previous three months.

This is better than the 1.5 percent jump forecast earlier - and also the fastest increase in two years.

Cumulatively, for the first half of this year, home prices have risen by 3.4 percent - just a touch below the 3.8 percent rise for the whole of 2005.

Separately, HDB prices rose by a shade below 1 percent in the second quarter compared to 0.2 percent in the first quarter.

The recovery of the Singapore residential markets continues into the second quarter.

And the final tally by the Urban Redevelopment Authority shows that home prices rose by 1.8 percent.

That's one fifth of a percentage point higher than the flash estimates - which only captured the first 10 weeks of the second quarter.

Donald Han, Managing Director, Cushman and Wakefield, said: "We had some activity during the last two weeks and that transpired based on some transactions from St Regis eventually got included in the sales and purchase so I suspect some of the high-end transactions like St Regis was not taken into consideration during the flash estimates."

St Regis set a new benchmark when a unit was sold at $3,030 per square foot during its launch in early June.

Optimism over the sustainable recovery of the market continues to run high as developers sell off their existing inventory.

Consultants say total unsold stock of 9,800 units compares well with the 20,000 units during the SARS period about 3 years ago.

This stock should represent a one-year inventory as consultants estimate private home transactions this year to hit 9,000 units, similar to last year.

So far, the mass market is lagging behind the high-end because of flat HDB prices and rising borrowing costs.

But some consultants say that could change soon.

Donald Han said: "Looking forward into next year, if interest costs can be kept at current levels and if HDB prices can continue to rise steadily over the 1-3 percent on a per quarter basis, you might be able to see some trickling effect into the mass market coming back to life."

Earlier this week, Kwek Leng Beng, the executive chairman of City Developments told Channel NewsAsia that he expected the mass market to rise in excess of 7 percent next year. - CNA/ch