PIVATE home prices in Singapore have inched up to a new record high though the once rapid rate of increase has again moderated as buyers turn cautious.
Analysts say their caution is the result of higher asking prices, uncertainty over possible new government property measures and a slowing economy.
Prices in the sector rose 2 per cent in the April to June quarter, slowing from 2.2 per cent in the previous quarter, according to Urban Redevelopment Authority figures released yesterday.
It was the seventh straight quarter of moderation. Landed property posted the biggest gains of 3.6 per cent.
This overall 2 per cent gain is, however, a slight rise from the 1.9 per cent flash estimate released earlier this month, indicating that sales recorded in the last two weeks of the quarter continued to show some price increases.
The slowing rises suggest a stabilised property market, analysts say, with runaway prices unlikely now that the number of new private home sales has fallen in recent months as well.
Total sales volume in the primary and secondary - or resale - market has also fallen 18 per cent in the six months to June from the same period last year.
'Home buyers have begun to resist the higher asking prices by sellers and they have also become more selective. There are some uncertainties as they await clearer housing policy directions from the Government,' said ERA Realty key executive Eugene Lim.
Tighter lending rules and sellers' stamp duty of up to 16 per cent have helped weed out speculative purchases.
The Housing Board's move to ramp up new flat supply has also helped calm demand and thus prices, said PropNex chief executive Mohamed Ismail.
Across the various segments - whether landed homes or condos, on the city fringe or suburban areas - prices largely slowed their pace of increase as well.
One exception was homes in the city centre, which saw values gain 1.6 per cent in the second quarter - quicker than the 1.1 per cent rise in the previous quarter.
The outlook for home hunters is positive, with experts predicting a continued price slowdown for the rest of the year.
They cautioned that while the residential market is still driven by low interest rates and ample funds, sentiment will be tempered by the record home supply in the pipeline, tepid global economic conditions and expected housing policy shifts.
PropNex's Mr Ismail said that data from his firm's transactions showed median per sq ft (psf) prices already falling across the island this month.
He expects prices to edge up a further 3 per cent to 4 per cent in the second half of the year.
Mr Png Poh Soon, Knight Frank's head of research and consultancy, expects an 8 per cent to 10 per cent jump in prices for the full year, significantly slower than the 18 per cent advance in prices last year, though still healthy by any standards.
Developers, however, may find themselves in a delicate situation in the light of the general slowdown and uncertain market sentiment, he added.
'Good quality developments will continue to attract demand, but they must be priced attractively to entice home buyers especially with the prospects of a quiet Hungry Ghost Month looming ahead.'
Private home rental growth also held steady with a slight increase of 1.3 per cent - marginally faster than the 1.2 per cent uptick in the previous quarter - led by rental growths in the semi-detached and terraced landed housing segments.
The broad-based softening also affected other property sectors, with the office and industrial segments mostly taking a hit. Gains in rents and prices mainly held steady or moderated quarter-on-quarter.
Cushman & Wakefield senior manager of Asia-Pacific research Ong Kah Seng said this reflected the effect of an economic slowdown and the increased price sensitivity of tenants as business costs rose.
Office rents, for example, inched up 1.5 per cent from 5.4 per cent the three months before, while prices rose at a slower pace of 3.6 per cent from 4.9 per cent.
'The office property sector is expected to achieve continued leasing and rental growth momentum, although (tenants) may be increasingly realistic in the face of modest economic growth, increased business costs and more space options,' Mr Ong added.
Price growth for industrial space eased to 5.5 per cent from 8.3 per cent, while rents slowed to 5.7 per cent from 6.3 per cent.
Shop space values, however, gathered pace to 1.1 per cent from 0.5 per cent in the first quarter as rents held steady with a 0.8 per cent increase.