As opposed to the figures that were anticipated in the Q1, the prices of private homes only dropped by 1%. Nonetheless, the extension of the circuit breaker period will have its impacts on the market thereby, exposing it downward pressure in the coming days, as per the predictions of the experts.
Experts have also delineated that there can be serious scopes for job losses followed by a string of other economic ambiguities throughout the lockdown.
CBRE’s head of research in South-East Asia, Mr. Desmond Sim, envisages that the prices will correct themselves by 5% to 8% within this year. He further added that uncertain economic situations might hold back buyers but, the developers who have weaker holding power can offer competitive pricing to let out their units in the market.
The head of research and consultancy of OrangeTee and Tie, Ms. Christine Sun, seemed a bit more positive about the prospects hinting that the prices could go down by 4% across the year, even though this calculation will be revised if the circuit breaker extends further June 1.
She stated that while it is absolutely true that the long-term repercussions of the coronavirus are still hazy but, the silver lining is that Singapore’s property market has always recorded stunning recoveries right after being hit by ugly economic crises. Activities pertaining to buying recuperate faster than all the other dips, owing to the hoarded demand caused due to prolonged weeks of isolation.
However, it is fairly quite early in the lockdown to outline forecasts simply from the data available but, the figures submitted by the Urban Redevelopment Authority (URA) marks the direction lying ahead. They revealed that the prices of the private homes plunged by 1% from the last quarter of the preceding year to the first three months of this year, which happens to be less than the awaited 1.2%.
The fall made its way after three continuous quarter-on-quarter gains. The ultimate URA data for Q1 showed that the prices of non-land property fell by 1%, something that is worse than 0.3% declivity of the previous quarter.
Costs of non-landed homes in the central region of the country descended by 2.2% after the 2.8% drop in the previous quarter and that of the landed homes was down by 0.9% after being struck by the 3.6% surge in the former quarter. In the last three months of 2019, the living units surrounding the core area fell by 1.3% but, during the first three months of 2020, the average configuration landed at 0.5%.
The same was the case for the suburbs of the city where the home prices declined by 0.4% when weighed against the 2.8% increase of the prior quarter.
The sub-sale and resale transactions for Q1 were 2,120 units, which on one hand is a 12.9% decrease from the previous quarter and on the other hand, 11.3% improvement on the year-on-year scale.
The developers launched about 6% fewer units (from 2,226 to 2,093) in the previous quarter and moved 2,149 new homes, (keeping aside the executive condominiums) which witnessed a dip of 12% quarter-on-quarter but, rose by 16.9% from March 2019.
The head of research at Colliers International for Singapore, Ms. Tricia Song affirmed that the consequences of the coronavirus are yet to reflect on the figures because the circuit breaker measures were imposed during the very end of the quarter and most of the transactions were already carried out in January and February. Additionally, she also made it clear that the developer sales can drop to 8,000 units this year from 9,912 units of 2019, given there’s some rebound because of the piled-up demand before the year ends.
Nevertheless, if the lockdown continues to persist, the developer sales can drop to mere 4,000 or 5,000 units only.
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