Property prices to stay soft: Analysts
HOME prices have taken a hit again, weighed down by a strong supply of new flats and loan curbs, said property analysts who noted that they could dip even lower at the end of the year.
Resale prices of HDB flats fell 1.3 per cent in the second quarter of this year, according to estimates released by the Housing Board yesterday.
Private home prices continued their decline for the third consecutive quarter - the longest decline in five years.
Overall prices of private homes fell 1.1 per cent over the previous quarter, according to Urban Redevelopment Authority flash estimates.
The decline in the private market came as no surprise for Christine Li, head of research and consultancy at OrangeTee, who said cooling measures - such as Additional Buyer's Stamp Duty and Total Debt Servicing Ratio (TDSR) framework - have caused the residential market to consolidate.
"Since the affordability of home buyers, especially that of upgraders, is hurt by these measures, home prices will need to come down in tandem," she said.
Eugene Lim, key executive officer of ERA Realty, pointed out that residential transaction prices have also been pressured by the rental market, due to completion of projects, with new demand being slower, after cuts in foreign manpower hiring.
Analysts expect the decline in prices to persist, albeit moderately. The overall decline for this year is forecast to be between 5 and 8 per cent.
SLP International research head Nicholas Mak said it is a good time for home buyers to start shopping around, but notes that sellers might remain cautious.
"The TDSR might make it difficult to secure a loan for their next investment, so some will think twice about selling now," said Mr Mak.