The flash estimates released by URA and HDB for 2Q10 have revealed a sustained demand for both the public and private housing.
The resale price index (RPI) inched up to another 3.8% to another new high of 160.9. The increase could be attributed to median Cash-Over-Valuation (COV) nudging up a little more quarter-on-quarter.
“Our 2Q10 transactions show a median COV of $30,000 for all flat types across all estates,“ reveals PropNex CEO Mr Mohamed Ismail, “while HDB’s 1Q10 results showed an overall median COV of $25,000.” PropNex holds approximately 30% of HDB resale market share. The sustained demand demonstrated by the higher COV is also evident in an expected increase of resale flats sold in 2Q10.
“Based on our own number of transactions for 2Q10,” says Mr Ismail, “we can expect to see 9,000 resale flat transactions for 2Q10, up from 1Q10’s 8,484. In addition, we are likely to see an overall 10% increase in the RPI for 2010.”
Looking at the price index flash estimate for private properties, Mr Ismail notes that it is continuously maintaining its steady growth from 1Q10 into 2Q10, with an overall increase of 5.2%, from 1Q10’s 175.0 to 184.1.
“This figure has surpassed the all-time peak of 181.4 in 2Q96,” he says, “I am confident that the private property price index will continue to go up towards the end of 2010. And this will be easily achieved with our projected overall growth of about 3-4% per quarter for the rest
of 2010.”
Upon examination of the price growths in the three geographical regions, the Outside Central Region (OCR) is in the lead at 5.7%. Next is the Core Central Region (CCR) with 5.1%, followed closely by the Rest Central Region (OCR) with 4.5%.
Furthermore, in 2Q10, the average number of private properties sold per month transacting below $1000psf was 863 units, which translates to 53% of all units sold. In 1Q10, only 32% of the properties transacted were sold below $1000psf. These figures indicate a strong demand for OCR properties in 2Q10.
