1Q 2018 sets the tone for the real estate market robust turnover in 2018
URA’s Q1 2018 Flash data shows that prices of private homes in Singapore rose by 3.1 per cent quarter-on-quarter (Q-o-Q) from 138.7 points (Q4 2017) to 143.0 points (Q1 2018) a record price since Q2 2010 where prices rose by 5.3 per cent. This is indeed the clear sign of positive market sentiments in the private residential segment, having witnessed three consecutive quarters of price increase thus far. This positive growth is apparent across the regions in Q1 2018 with CCR experiencing its highest price increase at 5.0 per cent while RCR and OCR enjoyed 1.1 per cent and 3.8 per cent growth respectively.
Positive growth expected to continue for 2018 with expected 8 per cent price growth for the year
CEO PropNex Realty, Mr Ismail Gafoor commented, “Moving into 2018, we can feel that buyers and investors are now taking action, propelled by the ongoing market exuberance with the bullish lands bids and continuous collective sales in the market. As expected, the year starts off with a record 3.1 per cent growth. With price appreciation expected to continue this year, we predict that not only transaction volumes will pick up, prices are set to increase by up to 5 per cent as well by the first half of the year. Overall, 2018 will witness a price growth of 8 to 10 per cent, mainly contributed by higher price points at new launches which will in turn bring up the overall selling prices of the resale and existing launches moving forward.”
Greater demand for Public Housing expected amidst affordable resale prices in 2018
In Q1 2018, Prices of Public Housing experienced its highest decline (-0.8 per cent) for the past nine quarters since Q1 2016. Mr Ismail highlighted that the continuous price decline into 2018 is highly attributed to few factors, different group of sellers who are in urgent need to dispose their properties within stipulated time: second timers who received their new keys with the completion of their BTO flats, new Executive Condominium upgraders who received the new keys to their homes and also those who are selling their resale flats in pursuit of upgrading to private properties in 2018. This has inadvertently created an on stream of supply of resale flats and also kept the prices muted for the past few quarters.
Mr Ismail shared, “With the positive sentiment in residential market as well as huge number of en bloc sales in 2017 and 2018, we predict a greater demand for HDB resale properties with some en bloc owners considering resale flats in the second half of the year. There is a likelihood that HDB prices may well experience a muted growth of up to 1 per cent in 2018.” Adding on, he commented, “The group of ex en bloc owners who will choose public housing, will prefer flats within two kilometres of their existing development and will also likely opt for bigger HDB flats like Executive Maisonette or Executive Apartments as cash is not a constraint for them.”