Sentiment in the private residential market continued to be buoyant in 1Q2018, with overall home prices soaring by 3.9% within the time period. This is compared with the 0.8% increase in the previous quarter, the latest report by URA showed.
The largest price surge was seen in the Core Central Region (CCR - 5.5%) and Outside Central Region (OCR - 5.6%). Meanwhile, home prices in the Rest of Central Region (RCR) rose by 1.2%.
The increase could be due to pent-up demand and buyers’ fear of missing out on good value buys as prices trend up, says Tricia Song, Colliers International head of research for Singapore. With stronger-than-expected price growth in 1Q2018, Song says she expects average private home prices to rise by 8% for the full year of 2018, implying a rise of another 4% for the rest of the year.
As home prices continue to rise, we seek out Singapore's most affordable new projects in 2018, by picking out projects that transacted below the average median psf price for new sales across respective market segments.
1) Core Central Region (CCR)
Avg. median psf price for new condos/apartments in 2018: $2,628 psf
According to Colliers’ Song, private home prices in the CCR have risen 7.1% from 2Q2017. This was despite fewer units being sold in 1Q2018 compared to 4Q2017, as developers increased prices with confidence.
For instance, New Futura, launched in 1Q2018, achieved good sales at an average price of $3,226 psf, Song shares.
She adds that ongoing launches such as Martin Modern and Gramercy Park have also been raising their selling prices since their initial launch. Based on caveats lodged, Martin Modern has seen its median transacted price increase from 2,178 psf in 3Q2017 to 2,703 psf by 1Q2018. Meanwhile, Gramercy Park’s median price increased to $3,177 psf in 1Q2018, from $2,670 psf a year ago.
2) Rest of Central Region (RCR)
Avg. median psf for new condos/apartments in 2018: $1,726 psf
While prices in RCR rose the least among the market segments in 1Q2018, it is now 3.1% above its low in 4Q2016. RCR’s prices increases has been more measured and this is likely due to the lack of new launches at significantly higher prices, Colliers’ Song notes.
But RCR should see its price growth catching up in the next few quarters, as projects such as Amber 45 and Park Colonial are expected to set benchmark price points. Currently, units at Amber Park and Park Colonial are transacted at an average median price of $2,173 psf and $1,829 psf respectively.
3) Outside Central Region (OCR)
Avg. median psf for new condos/apartments in 2018: $1,352 psf
Prices of private residential properties in the OCR are now at 7.2% above their trough in 2Q2018, and projects that saw noticeable price increments include Kingsford WaterBay in Hougang, which transacted for $1,377 psf in March 2018 compared to $1,169 psf from a year ago. Another example is Clement Canopy near the West Coast, which had a median price of $1,507 psf in December 2017, compared to $1,343 psf in February 2017.
In late March, the launch and take-up rates of The Tapestry at higher prices may also have contributed to the spike in the growth of OCR home prices. About 70% of 450 units at The Tapestry were sold during the first weekend of its launch, at an average selling price of $1,310 psf.
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