SINGAPORE (Nikkei Markets) -- Private home prices in Singapore fell for the 14th straight quarter in the three months to March 2017 as developers offered discounts, especially on higher-end apartments.
Although prospective buyers are showing greater interest, analysts say they expect the price decline to continue this year.
Flash estimates from Singapore's Urban Redevelopment Authority on Monday showed private residential prices slipped 0.5% quarter-on-quarter in the first three months of 2017, the same rate of decline as in the fourth quarter of 2016.
The fall was due chiefly to weakness in the high end of the residential market, with prices of apartments in the core central region declining 2.0% on quarter and landed homes, which include terrace houses and bungalows, falling 2.8%, URA said in a press release. The core central region refers to homes near the Orchard Road shopping belt as well as those near the central business district and on the resort island of Sentosa.
By contrast, prices of homes in the outer suburbs or outside the central region increased by 0.1%, after registering a 0.6% decline in the previous quarter, URA said.
Hari Krishnan, chief executive officer of PropertyGuru Group, which includes PropertyGuru, a popular site for real-estate listings, said the steady-to-firmer prices for homes outside the core central region is reflected in the strong demand for new projects in the suburbs. According to Krishnan, developments that sold well during the quarter include UOL Group's Clement Canopy in the western part of Singapore.
Residential property prices in Singapore have fallen over the past three years due to a series of cooling measures that the authorities began to introduce in 2009. An index compiled by URA shows private home prices fell 3% last year and are down around 11% from their peak in late 2013.
Sentiment has picked up in recent months, however, especially after the government's surprise decision to relax some property measures in March. URA data showed developers sold 977 private homes in February, more than two-and-a-half times the number of units transacted in January and triple what was sold in February 2016.
Private property accounts for about 20% of total housing in Singapore, where most citizens live in government-built apartments.
Ismail Gafoor, CEO of PropNex Realty, a firm of real estate brokers, said that while sentiment has improved, he still expects private home prices to fall by around 2% this year due to weakness in the top-end of the market.
"The new additional conveyance duties...have also created more supply... which could lead to some price adjustments in the core central region," he said.
In March, the government closed a loophole that allowed some developers to avoid taxes or levies on unsold homes by selling apartments in bulk to institutional investors and wealthy Singaporeans via the transfer of shares in a holding company.
Developers who bought land from the government are now required to pay an additional buyer's stamp duty of 10% or 15% on the land cost, if they do not build and sell all the units within five years.
Developers sold around 8,100 new units last year, about 10% more than the 7,400 units transacted in 2015. However, sales are still well below the nearly 15,000 units sold in 2013 and 22,000 units that changed hands in 2012.
--Nikkei Markets is a real-time financial news service for South East Asia's markets published by Nikkei NewsRise Asia Pte Ltd, a Nikkei and NewsRise joint venture company. Nikkei Markets provides wide companies coverage in the region, including the Nikkei's Asia300 companies.