Home owners see valuation below purchase price on 2007

Prices of private homes fell off a cliff in the first quarter 2009, continuing a dramatic slide that has now wiped out the gains owners have made since 2007.

Values dived:
- 14.1% in the Quarter 1 of 2009 (the biggest fall on record).
- 6.1% slide in the Quarter 4 of 2008.

Private homes prices drop on areas:
- 17% on city fringes
- 16.2% in the city centre
- 7.3% for suburban residences.

But there was a sliver of good news. Sales of new homes in the first quarter were a robust 2,596 units, driven by pent-up demand, price cuts and innovative product packaging. Developer sales in suburban areas reached 1,637 units in the first quarter, almost as many as were sold last year.


The hefty gains over the past two years have been erased, so owners who bought after the first quarter of 2007 could see their home's valuation fall below the purchase price. HDB resale flats showed more resilience with prices inching lower by just 0.8 per cent in the first quarter - the first fall since the third quarter of 2006. [report]

Urban Redevelopment Authority (URA) also point to pain in the residential rent market and in the office sector. Rents for private homes also kept falling and at a faster rate. They plunged 8.5 per cent in the first quarter compared with a 5.3 per cent decline in the last three months of 2008. Rents of non-landed prime homes fell the most, at 10.3 per cent.


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