Moves to rein in the once red-hot property market are biting, with prices taking another beating in the first quarter.
Private home prices fell across the island - the first time in nearly five years that all segments have taken a hit in the same quarter.
The biggest drop came in the city fringe, which includes areas such as Bishan and Queenstown.
The 1.3 per cent slowdown in the January to March period, a steeper slide than the 0.9 per cent drop in the preceding three months, was the broadest yet.
In the public housing market, Housing Board resale flat prices also lost ground for a third straight quarter. The 1.6 per cent drop there was sharper than the previous quarter's 1.5 per cent. The number of resale transactions fell again, down 5 per cent.
Analysts warned that the weakness in the market could deepen further, with the weaker HDB prices likely to affect the mass market private homes segment. They expect private home prices to fall 5 to 8 per cent by the end of this year.
A glut of unsold units is forcing developers to consider lowering prices, they noted.
Although the city fringe was worst hit in the first-quarter price slide, the city centre and suburbs fared little better.
Tough curbs imposed last year on home loans were the main reason, analysts said, but added that a Chinese New Year lull at the end of January dampened buying activity.
Developers also held back major launches as they waited to gauge market sentiment.
JLL Singapore research head Ong Teck Hui said the number of unsold units was weighing heavily on developers: "They have to compete with a significant backlog of unsold inventory."
Out of the total supply of 80,261 private homes under construction at the end of March, slightly more than a third - or 29,482 units - were still unsold, the URA said yesterday.
However, analysts held out hope that a slew of new projects in attractive locations set to go on sale over the next two months might cushion the price decline. These include Commonwealth Towers, The Crest and Highline Residences.
"With the market more attuned to the various measures and policies in place, the time is ripe for developers to step up launches... before prices head further south," said Colliers International research director Chia Siew Chuin.
One reason the city fringe was so hard-hit may be that developers are offering sweeteners and discounts to move units, analysts said. Prices of non-landed private homes in that segment sank 3.3 per cent in the first quarter from the preceding three months. This was a stark reversal of the 0.4 per cent rise the preceding quarter.
In the city centre, prices slipped 1.1 per cent in the same period, on the heels of a 2.1 per cent slide the preceding quarter.
OrangeTee research head Christine Li noted that for both the city fringe and city centre, new home prices fell more sharply than for those of resale homes.
The opposite unfolded in the suburbs, where new non-landed home prices rose 1.4 per cent.
That was likely due to solid sales at launches such as Rivertrees Residences and Riverbank @ Fernvale in February, she said.
Accounts executive Alicia Wong, 34, who bought a one-bedder at Riverbank, told The Straits Times she took the plunge as she "did not want to wait any longer". "Other projects launching later may not be as affordable."
After factoring in resale homes, non-landed private home prices in the suburbs still dipped 0.1 per cent. This followed a 1 per cent drop the quarter before.
This article was published on April 26 in The Straits Times.
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