Advertisement
Advertisement
International Property
Get more with myNEWS
A personalised news feed of stories that matter to you
Learn more
The rush of transactions are fuelled by developers’ land bids and en-bloc sales. Photo: Roy Issa

Singapore property prices rise despite additional government curbs

Buyers have to stump up more cash upfront for first home loans under new rules

Singapore private home prices are still inching higher – albeit at the slowest pace in five quarters – even after the government imposed additional property curbs to avoid the risk of a sharp correction that could be destabilising to the city-state’s economy.

An index tracking private residential prices increased 0.5 per cent in the three months ended September 30, compared to a 3.4 per cent advance in the June quarter, according to a flash estimate from the Urban Redevelopment Authority on Monday. That adds to a 9.1 per cent gain in the year through June.

Apartment prices in prime districts rose 1.2 per cent last quarter, compared to a 0.9 per cent gain in three month through June 30. Unit prices in suburban areas added 0.1 per cent after climbing 3 per cent in the previous quarter.

Prices near prime areas slid 0.8 per cent after gaining 5.6 per cent in the June quarter, the data showed.

Singapore took renewed steps in July to cool the island’s property market after a steep rise in home prices in the first six months.

The rush of transactions was fuelled by aggressive land bids from developers and so-called en-bloc transactions, which is where a group of owners band together to sell entire apartment buildings.

Private apartment blocks in Singapore’s eastern district. Photo: Roy Issa
Under the new rules, individuals taking out their first housing loan face stricter borrowing limits, meaning they have to stump up more cash upfront.

For foreign purchasers of residential property, the additional buyer’s stamp duty was increased to 20 per cent from 15 per cent. For Singapore citizens, the extra charges only apply from their second home purchase.

Prices are not rising everywhere in Singapore’s property market. In Sentosa Cove, a residential enclave nestled on an island off the coast, average prices are down almost 30 per cent from their 2011 highs, a far more severe slump than in prime central London areas reeling from Brexit.

As developer stocks sink, investors are turning toward real estate investment trusts, or the businesses that hold the real-estate assets rather than the ones that sell them. The FTSE Straits Times Real REIT Index is outperforming a benchmark that tracks home builders.

This article appeared in the South China Morning Post print edition as: Singapore home prices rise even after additional curbs
Post