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The Straits Times
Published on Dec 29, 2012
1.9% price rise for resale non-landed homes strongest this year

By esther teo property reporter

DEFYING expectations, price increases for resale non-landed homes last month were the strongest so far this year, buoyed by a rebound in the high-end segment.

The 1.9 per cent rise in prices across the board from October came despite the traditionally slow festive period and a sixth round of cooling measures in October.

The latest rise comes on the back of a 0.8 per cent gain in October, indicating that the fourth quarter could well be the strongest three-month period this year.

The increases were recorded by the Singapore Residential Price Index, which the National University of Singapore compiles by monitoring the transactions of a basket of non-landed completed projects.

Excluding small apartments, centrally located homes posted the largest gain of 2.6 per cent - also the sharpest rate of growth for the segment this year - while non-central home prices inched up 1.3 per cent.

Prices of small units enjoyed a 1.7 per cent rise, almost double the 0.9 per cent gain in October.

Experts say buyers could have turned back to the resale market as developers launched new units that pushed price boundaries.

R'ST Research director Ong Kah Seng said resale homes not only are more affordable but also offer larger units which are increasingly rare in new projects.

He expects buyers' interest in such homes to hold firm on the back of low interest rates and cheaper pricing. This is likely to translate into slight and sustainable price gains for resale homes.

"Ongoing infrastructural developments, district rejuvenations and ample new private home launches will be more evident next year, benefiting all homes, whether resale or new completions," he added.

But Mr Nicholas Mak, head of research at property consultancy SLP International, said his firm's analysis of secondary market caveats lodged with the Urban Redevelopment Authority (URA) for central homes showed average prices dipped 1.5 per cent last month instead.

This discrepancy could be due to a difference in methodology, he noted.

He expects the fourth-quarter flash estimate of the URA price index due out next week to post a 0.5 to 0.9 per cent increase.

"Both the new and resale markets have remained stable despite the October cooling measures.

"While there has been a slight drop in the number of transactions for centrally located homes, it has not been as drastic as when the additional buyer's stamp duty was introduced," he said.