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Posted on: 24 Jul 2015

Singapore private home prices fall for 7th quarter

SINGAPORE: Prices of private homes in Singapore dropped for the seventh straight quarter, the longest declining streak in more than a decade, and analysts expect the market to continue to soften for the rest of 2015 as property cooling measures take their toll.

The second-quarter private residential property index fell 0.9% from the previous quarter to 144.2, with prices dropping across all market segments, Urban Redevelopment Authority data showed.

Singapore has introduced several rounds of cooling measures since 2009, including higher stamp duties and tougher mortgage conditions, hurting sales volumes. The measures sent prices of private homes down 4% in 2014, the first year of overall price decline since the global financial crisis.

"There is a fair bit of latent demand just waiting in the wings," said Nicholas Mak, executive director of research and consultancy at SLP International.

He said the government would be wary of relaxing measures ""too much or too fast"" if there was a possibility that it could lead to a sharp rebound in prices.

Mak expects prices to fall 2.5% to 5% in 2015.

The central bank earlier this week said it was premature to consider removing the cooling measures.

"In the context of the price increase - 60% over three years - the softening we have seen is really not all that much," said Ravi Menon, managing director of the Monetary Authority of Singapore.

The private residential property index has lost nearly 7% in the last seven quarters.

The last time home prices fell for such a long stretch was for eight quarters from the third quarter of 2000.- Reuters
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