Prices of new homes across all segments still at historical highs, says OrangeTee

/ EdgeProp
November 21, 2018 3:57 PM SGT
Despite the slew of new property cooling measures, the private residential sector remained resilient in the 3Q2018, according to Christine Sun, head of research & consultancy at OrangeTee & Tie.
A few new project launches continued to see healthy buying interest during the quarter after the property cooling measures imposed on July 6, says OrangeTee. In the quarter, according to URA data, overall new home sales (excluding executive condos) rose 27% q-o-q to 3,012 units. The spike in new sales could be attributed to many projects being launched in the city-fringe, or Rest of Central Region (RCR), as well as the more than 1,000 units sold on the eve of the implementation of the cooling measures, adds Sun.
Credit: URA, OrangeTee&Tie Research & Consultancy
The number of new home sales (completed and uncompleted) in the RCR surged to 1,765 units, up 91% q-o-q and 106% y-o-y, in the quarter. More new projects were launched comprising 2,338 new units, 187% higher than the preceding quarter.
The resale market suffered the greatest impact from the cooling measures in the quarter. Overall resale transactions fell by 43% q-o-q to 2,672 units in 3Q2018; and in the suburbs or Outside Central Region (OCR), resales dipped 45% to 1,051 units.
OrangeTee’s Sun attributes the decline in resales in the OCR to reduced demand from HDB upgraders as their affordability is limited by the 5% cut in Loan-To-Value (LTV) ratio that was part of the July property cooling measures. A relatively weaker HDB resale market is also affecting sellers’ proceeds, she adds.
Prices of residential homes (landed and non-landed) continued to rise, but at a slower rate of 0.5%, in 3Q2018. For the first three quarters of this year, prices of residential homes increased 7.9%.
Credit: URA, OrangeTee&Tie Research & Consultancy
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