Private property prices defy government's cooling measures

The private homes market in Singapore continued to resist the government’s cooling measures, recording another quarter of price increases.

URA’s flash estimates showed that the private price index of private residential properties for Q1 rose to 174.2 points. This is 5.1 percent higher than in the fourth quarter of 2009.

However, the pace of growth was slower than the 7.4 percent increase in October to December last year. The index remained two percent below the mid-2008 peak levels and four percent off of the 1996 property boom.

Several industry observers said that the price increase could have been higher if not for the recent anti-speculative measures introduced by the government in February.

“If the demand for private homes continue for the rest of this year unabated, the record average private home prices set during the property boom in 1996 could be exceeded before the end of this year," said real estate lecturer at Ngee Ann Polytechnic, Mr. Nicholas Mak.

He expects prices to increase by 12 percent to 22 percent for the whole of 2010.

Mr. Donald Han, managing director of Cushman and Wakefield for Singapore, thinks that the record peak in the property market could be hit in three to six months. "We are expecting 1Q 2010 (sales) volume to be between 3,800 and 4,100 units.”

The data released by URA showed that prices of non-landed private homes in the prime Core Central Region increased by 4.5 percent, 3.9 percent in Outside Central Region and 7.2 percent in the Rest of Central Region.