Prices of private apartments appear to stablise with dip of 0.6%

Prices of completed private apartments appear to be stabilising after months of decline, despite some ambiguous data out yesterday.

The new numbers point to a 0.6 per cent dip in values from July to last month following stagnant pricing in June and July, according to flash estimates for the NUS Singapore Residential Price Index. Resale transactions of central units, excluding small units, were down 23 per cent to 114 last month, while non-central unit sales fell 23.6 per cent to 272.

The slight price decline last month was led by completed units in the central region – Districts 1 to 4 and 9 to 11, which posted a 0.7 per cent month-on-month drop. But prices for this segment rose in June and July and are up about 0.2 per cent from May.

Yesterday’s flash estimates also indicate that the market has some ground to make up. The overall index is down 4 per cent, compared with August last year, and is 10.5 per cent below July 2013, when prices were at their highest in recent years.Small units – up to 506 sq ft – are one of the brighter spots. Prices were flat last month after rising 0.5 per cent from June to July.

If the inflow of foreign labour continues to be tight, the leasing market will stay soft. Lower rental returns will likely hit unit prices as well.

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