HDB resale, private home prices show significant growth in Q2

HDB resale, private home prices show significant growth in Q2
By Daryl Loo, Channel NewsAsia | Posted: 02 July 2007 2057 hrs


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HDB resale, private home prices show significant growth in Q2







SINGAPORE: Urban Redevelopment Authority's (URA) initial estimates have shown that prices of private properties have gone up by 7.9 percent in the second quarter, close to a ten-year high.

Resale HDB prices have also risen by 2.9 percent to a level not seen in seven years.

The 7.9 percent overall increase in private property prices in the last quarter outstrips the 4.8 percent rise in the first three months of this year.

This compared with a 9.8 percent increase recorded for the whole of last year.

In Q2, prices of non-landed private residential properties increased by 7.6 percent in the Core Central Region and by 7.9 percent in the rest of the Central Region.

More notably, prices of private properties in the Outside Central Region rose by 6.5 percent, providing further evidence that the upturn is filtering down to the mass market.

Some analysts said this is a healthy sign.

Ku Swee Yong, Director, Savills Singapore, said: "We are very happy to see that prices in the mass market, which is labelled as Outside Central Region, are growing in tandem with the prices in the Central and Core Central districts, along with a strong growth in HDB numbers.

"Together, these numbers show that the foundation for the property market in general is across-the-board and that supports the growth that is in the top end of the market as well."

The latest numbers are causing property watchers to re-look at their estimates for the full year.

Some said they are likely to revise their forecasts upwards for a jump of more than 20 percent in private home prices.

And while the 2.9 percent increase in HDB resale prices is the biggest improvement in nearly nine years, observers said the full-year rise for flats is likely to be a slower 10 percent.

Eric Cheng, Senior Division Director, PropNex, said: "I do not think HDB prices will catch up with the private market because the private pace will be much faster than HDB. HDB would be a consumer market in general and prices will gradually increase."

Analysts said the strong improvement in the second quarter was due to the secondary market, helped by a large number of buyers seeking replacement homes for their apartments that were sold en-bloc.

Mr Ku said: "There wasn't a single significant project that was a contributor to this growth. I think it has sort of spread out to the secondary markets. People started taking interest in areas that used to be undervalued. For example, there was a lot of interest in properties along Bukit Timah Road up to King Albert Park in the past few months."

Updated reports from URA and HDB will be released in about a month.