Prices of completed non-landed private homes slipped 0.5 per cent in January, going by the flash estimates of the Singapore Residential Price Index (SRPI) of the National University of Singapore (NUS), even as prices of homes (excluding small units) in the non-central region edged up 0.1 per cent.
For January, the overall index was dragged down by the prices of homes (excluding small units) in the central region, which dipped 1.1 per cent month-on-month. The central region is defined as districts 1 to 4 (including the financial district and Sentosa Cove), and the traditional prime districts of 9 to 11.
Meanwhile, the price increase of resale properties in the non-central region could be said to reflect cautious optimism. However, the increase could have come from the fact that transactions that took place in January included newer units, which tend to be smaller in size.
Prices of small units – defined as those with strata area of 47 square metres (506 square feet) or less – contracted 0.6 per cent month-on-month in January.
This could be a turning point for small units. Last year, completed small units were generally well received by tenants, but this is set to change, with an increased number of completed small units – including in the suburban areas – in the coming year.
The latest flash statistics were based on Basket 7, which is fixed with December 2013 as the base period. It comprised 429 private residential projects across 25 postal districts in Singapore, which were completed between October 2003 and September 2013. Data was derived from transactions received as at Feb 20. Properties in the NUS SRPI basket are selected to represent the private non-landed residential market based on several criteria. In general, the projects comprise at least 40 units, have good amenity levels, enjoy reasonable transaction activity and are not targeted for redevelopment.
The composition of the basket is adjusted every two years to reflect the changes in the completed stock of non-landed residential properties in Singapore.
Small units were represented in about 21 per cent of the projects featured in Basket 7. This is twice the proportion in Basket 6, and mirrors the increasing popularity of small-unit offerings in newer, non-landed residential developments.
December 2013′s revised NUS SRPI values (based on Basket 6) showed that the overall index dipped 0.9 per cent. The NUS-SRPI Non-Central (excluding small units) sub-index dropped 1.8 per cent, followed by the small units sub-index, which dipped 0.4 per cent. Only the NUS SRPI Central (excluding small units) sub-index rose 0.3 per cent.
Source: Business Times – 1 March 2014