Mild Drop of 1.1% in URA Q2 2020 Private Home Price Index

The Urban Redevelopment Authority's benchmark overall private home price index fell for the second consecutive quarter. It eased 1.1 per cent quarter-on-quarter (q-o-q) in Q2 2020 based on the flash estimate issued on Wednesday, after slipping 1.0 per cent in Q1 2020.

Suburban non-landed private home prices remained unchanged in the April to June period.

Property consultants generally said that a price decline in Q2 was to be expected, given the drop in transaction volumes during the circuit- breaker partial lockdown to contain the Covid-19 bug.

From April 7 to June 18, showflats were shut and property viewings disallowed.

All things considered - the severe setback in terms of disruption to business activity and movement of people during the circuit breaker - most consultants termed the drop in URA's benchmark index in Q2 as "mild" or "gentle".

Said PropNex chief executive Ismail Gafoor: "We think the 1.1 per cent price drop in Q2 was measured and reflected some resilience amid this pandemic."

On the whole, new private homes (excluding executive condo or EC units) sold fell 37.5 per cent q-o-q to 1,343 units in Q2 2020, shows Colliers International's analysis of URA Realis data as of July 1.

The number of secondary market transactions of private homes shrank at an even steeper pace of 65.2 per cent q-o-q to 738 units in Q2 2020.

Year-on-year, URA's benchmark private home price index is down 0.3 per cent based on the flash estimate. It is also 2.7 per cent below the all-time peak in Q3 2013.

Since the end of last year, the index has eased 2.1 per cent.

Property consultants' forecasts for the full-year drop in the index vary. At the lower end of the range is Mr Ismail of PropNex, who is projecting a fall of up to 3 per cent, "with the potential rebound in new homes sales lending support to prices in the second-half of the year".