Singapore Property | According to the Urban Redevelopment Authority data, prices of landed homes rose by 0.9% in Q4 2016 on a quarter-on-quarter basis reversing the quarterly drop of 2.7% recorded in quarter 3.
While this was the first increase since the third quarter 2013, experts cautioned that it does not imply that prices are on the rise since the segment could encounter more pressure in 2017.
Nicholas Mak, SLP International research head noted that the increase may have been a statistical blip and it may not be sustainable. He does not think it is a signal for the beginning of a recovery.
However, CBRE indicated that there has been an increase in the number of transactions as the submitted caveats increased by 16.8% to 1,336 recorded in 2016 in comparison to 1,144 recorded in 2015.
(An artist's impression of Jazz Residences)
This could suggest that prices are enticing buyers to come back to the market since there have been a large decline in prices from the 14.8% recorded in the third quarter 2016 in comparison to what was recorded in a similar period last year.
“Since more buyers are prepared to purchase at the present price level, it is likely to stabilize the price index making it inch up,” said Ong Teck Hui, JLL National Director of Research.
Desmond Sim noted that buyers would have been prompted by the rising interest rates to purchase before the rates increase higher.
The detached housing sector boosted the landed properties prices in quarter four 2016. It recorded big deals that included property sale at 2E Bishopsgate at $26.8 million. Another 2 homes that were transacted are 67 Holland Park and 17 White House Park which were sold for $25.5 million each.
Despite the unexpected rise in transactions in quarter 4 2016, the entire year experienced a reduction in prices by 4.4% while the previous 2 years had a price drop of 4.1% and 5.3% respectively.
However, experts believe that landed residential properties’ prices are likely to remain the same or have a gradual reduction in 2017.
Wong Xian Yang, Research and Consultancy Head of Research added that the prices of landed homes are still under pressure with the current cooling measures and weak economic conditions.