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Singapore Property | Suburban apartment resale prices down

High-rise private apartment condominiums in the Scotts Road and Cairnhill area. PHOTO: ST FILE


Mar 9, 2016, 5:00 am SGT

Rennie Whang

A gap in fortunes seems to be opening up between resale prices of private apartments in the coveted core central region and those in other parts of Singapore, according to data out yesterday.

Resale prices of flats in the core central region (CCR) were unchanged in February after rising for three straight months and are about 4.7 per cent above values in February last year, according to SRX Property flash estimates.

Resale prices of city-fringe apartments are up by only about 0.6 per cent year on year while prices of those in the suburbs have fallen 5.3 per cent in the same period. Overall, SRX Property's February price index for all non-landed private property is down about 1.6 per cent compared with a year earlier.

The slight rise in CCR resale prices over the past year is likely due to foreigner interest in the area since the second quarter of last year, said Savills Singapore research head Alan Cheong. Some nationalities see Singapore luxury property as a value buy, even with the 15 per cent Additional Buyers' Stamp Duty.

Prices of luxury homes here are around 30 per cent below those of their Hong Kong counterparts, according to Savills estimates. Many such homes here are freehold as well, unlike the short leases in Hong Kong.

At the same time, Malaysians may have been buying due to political uncertainty back home while Indonesians have consistently been among the top three foreign buyers.

CCR prices should remain stable this year. "The ultra-high-net- worth has always been impervious to economic slumps - unless it is a crisis, which it is not the case right now," said Mr Cheong.

On the other hand, buyers of city-fringe and suburban apartments tend to be salaried employees who are more affected by the uncertain economy. Suburban condo prices face pressure from the large number of completions.

Rents have followed suit. A three-bedroom suburban condo that could be leased at about $3,800 a month a year ago would likely fetch about $3,200 now, a 16 per cent drop, said ERA Realty key executive officer Eugene Lim.

Suburban condo resale prices could fall by about 5 per cent this year, estimated R'ST Research director Ong Kah Seng. Some investors who bought in from 2011 would be clearing the four-year holding period to avoid incurring seller stamp duties in the middle of this year and may try to offload.

Overall resale apartment prices fell an estimated 0.3 per cent from January, with about 356 units resold - 10.8 per cent lower than in January but 3.8 per cent up from a year earlier, SRX said.

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