Chart of the Day: Here's how private home prices dipped further in 2Q

Despite massive launches and higher sales.

Private home launches together with new private residential units sold increased in 2Q resulting in substantial growth in transaction volumes, a trend that is opposite to the sector’s slipping prices.

A report by Savills reveals that the Urban Redevelopment Authority’s (URA) price index of private residential properties registered its third consecutive drop, slipping 1.0% in 2Q. Average prices of high-end non-landed homes tracked by Savills also continued to soften, easing 1.1% QoQ to $2,330 psf.

Savills adds that the pipeline of private residential homes at the end of 2Q stands at 83,633 units, about 8,066 of which will be completed by the end of this year.

Coco Palms and Commonwealth Towers were the main contributors to the increase in launches, accounting for more than half of the units launched in May. The healthy take-up in April could have encouraged developers to test the market with units which were competitively and attractively priced.

“The sharp increase in transactions after prices moderated marginally point to a very price-elastic market, giving a clear signal that underlying demand is strong and allaying fears of a market meltdown,” says Alan Cheong, senior director at Savills Singapore.