PRICES of private resale homes nudged higher again in May, maintaining a trend of recent months.
Overall, prices gained 1.5 per cent last month, buoyed by price rises of homes islandwide.
High-end homes in the central area inched up 0.8 per cent while mass market ones rose a stronger 2.2 per cent.
Record prices of some new suburban launches had prompted buyers to look again at the resale market which seemed to be a value buy.
- Mr Png Poh Soon, head of research at Knight Frank
Prices of tiny shoebox units - about 500 sq ft or smaller - moved up 0.9 per cent in May, after dipping 0.8 per cent the month before.
The flash figures released yesterday in the Singapore Residential Price Index were compiled by the National University of Singapore's Institute of Real Estate Studies.
The monthly report measures a basket of non-landed completed private units and condominiums. It excludes executive condos, a public-private housing hybrid.
Property consultant Ong Kah Seng said that the overall price increase is 'within expectations', as sales activity and interest in resale homes have kept up since a pick-up emerged in March.
The R'ST Research director noted that the 2.2 per cent rise for non-central homes is partly a result of limited choices from fewer condo launches in May.
Another factor is improved buyer interest in homes which are attractively priced, like those below $1,000 psf, Mr Ong said.
'Resale properties are lower-cost options... this attracts practical buyers who can trade off the frills for a lower-cost, well-located, and comparatively spacious resale property with tested investment fundamentals,' he said.
The price increase for luxury homes in the central area points to sustained recovery momentum in the sector, he said.
Mr Png Poh Soon, head of research at Knight Frank, said overall resale prices are likely to keep rising for the next one or two months, until the price gap between new and resale homes narrows.
'Record prices of some new suburban launches had prompted buyers to look again at the resale market which seemed to be a value buy,' he said, adding that demand for resale homes will hold up as long as buyers consider them a better deal than new homes.
But homes in the central region are likely to see price rises of less than 1 per cent as new high-end properties are not seeing high demand now. 'So if developers start slashing prices, resale units won't be so attractive any more,' Mr Png said.