There have been concerns that a red hot market could result in a bubble but the latest figures from the Urban Redevelopment Authority (URA) revealing that private home sales are now falling.
Some 583 units were sold in December down from 1,332 the month before. Private home sales hit a record 16,364 units in 2010, topping the previous peak of around 14,800 in 2007 according to Colliers International.
But analysts warned that the end of the year is often a slow time in the property market as there are fewer launches and lower interest from buyers and sales are likely to pick up again.
‘December is a month where you got parents rushing around for their children’s PSLE results, you’ve got people going off on their holiday. Developers at the same time also launch fewer units and will have advertised less in the month of December,’ said Ku Swee Yong, chief executive officer of International Property Advisors.
The most expensive property sold was at the Ritz Carlton Residences Singapore in Cairnhill at S$4,307 per square feet, while Punggol EC Prive sold the most number of units at 326 in total for a median price of S$704 per square foot.
Analysts said prices for suburban properties are hitting new highs. For example, Centro Residences in Ang Mo Kio sold at a median price of S$1,400 per square foot in December last year. This was close to city fringe prices, with D’Leedon at Farrer Road costing S$1,500 per square foot.
Analysts said the latest round of cooling measures should limit speculation going forward, especially in the mass market home segment.
‘Outskirts locations will typically go for S$1,000 a square foot compared with S$1,300 or S$1,400 per square foot,’ said Donald Han, vice chairman, Cushman & Wakefield. ‘The S$1,300 or S$1,400 per square foot may not be sustainable, so that’s where potentially we might see the scaling down in terms of price,’ he added.
‘We won’t see an active buying market, but at some point, something has to give and potentially there could be some developers who will have to reduce their asking price, or provide more incentives to lure back buyers who are sitting on the fence,’ added Han.
Some predict that transaction volumes will moderate and could fall by as much as 10% this month. ‘We will probably see a knee jerk reaction in January, so I expect that January numbers and probably February numbers to be nowhere as strong as what we have seen for December,’ said Yong.
