Private home prices dropped to pre-ABSD levels in 2014

Prices dipped 4% for the entire year.

Private home prices have finally fallen to pre-ABSD levels in 2014. Data released by the Urban Redevelopment Authority showed that private property prices registered a 4% full-year decline in 2014, while prices registered a 1% quarter-on-quarter slip.

“Latest figures released by URA show that current price levels of private property in Singapore are now similar to levels recorded in the second half of 2011, just before the first set of Additional Buyers’ Stamp Duty (ABSD) was imposed,” said Desmond Sim, Head, CBRE Research, South East Asia.

He also stated that the TDSR framework has clearly achieved what it set out to do in the private property market. Where it previously impacted volume, having halved sales volume to 7,500 units from the 14,948 units sold in 2013, the TDSR framework has now begun to make its mark on prices.

Data from the URA showed that For the whole of 2014, prices in CCR, RCR and OCR have fallen by 4.1%, 5.2% and 2.2% respectively. Prices of landed properties fell 1.1% compared to the 1.8% decline in the previous quarter. For the whole of 2014, prices of landed properties fell by 5.2%. 

“This is the first time that the full-year index has registered a decline of 4.0% since 2008, when the price index fell by 4.7%. Market watchers are now largely in agreement that the TDSR framework, which takes into account all loan obligations, has served its purpose in bringing down sales volume and cooling prices and at the same time ensuring the gearing health of the market. The positive side of this is that it means that homebuyers who can afford homes, have stronger financial muscle and should be able to weather any rise in interest rates in the near future,” he added.