Looking ahead to 2021, overall private home prices is expected to rise by 1% to 4%, while new home prices may increase at a faster pace of between 2% and 5%, says Christine Sun, Head of Research and Consultancy at OrangeTee and Tie.
Private home prices in Singapore rose 2.1% in the fourth quarter of 2020, after climbing 0.8% in the previous quarter, according to flash estimates by the Urban Redevelopment Authority (URA) on Monday (4 January).
Christine Sun, Head of Research and Consultancy at OrangeTee and Tie, said it was the steepest quarterly increase since the second quarter of 2018 when prices rose 3.4%.
For the whole of 2020, prices increased 2.2%, lower than the 2.7% hike registered in 2019.
Prices were mainly driven by the Rest of Central Region (RCR) and the Core Central Region (CCR) where prices jumped 4.8% and 3.3% quarter-on-quarter, respectively.
The Outside of Central Region (OCR) saw prices increase 1.7% quarter-on-quarter.
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For the whole of 2020, prices in CCR declined 0.2%, while prices in the RCR and OCR increased 5.1% and 3.1%, respectively.
“There were a number of new projects launched in the fourth quarter of this year that could have driven prices higher in these regions,” said Sun.
“Prices have also increased at many launched projects,” noted Sun.
In RCR, Fourth Avenue Residences saw its median price increase to $2,296 psf in Q4 2020 from $2,258 psf in Q3 2020. Prices at Kopar at Newton also increased to $2,433 psf in Q4 2020 from $2,384 psf in Q3 2020.
Looking ahead, Sun expects Singapore’s housing market to continue to be boosted by the ample liquidity still circulating within the financial system.
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“Buyer sentiment may pick up further on the growing vaccine optimism and Phase 3 reopening. A number of blockbuster launches could be released in the luxury and city fringe areas which may uplift the overall price index,” she said.
Sun sees overall private home prices rising by 1% to 4%, while new home prices may increase at a faster pace of between 2% and 5% in 2021.
She further noted that there has been a renewed interest in resale properties in the last few months.
“Luxury homes and big resale units have been in demand, while attractively priced private resale homes in the mass market and city fringe areas have been snapped up.”
With this, she expects demand for resale homes “to pick up further this year while resale prices may increase around 1% to 4% for the full year”.