<alert!> Singapore Property: URA Flash estimates indicate a surge in OCR home prices
Surge in OCR home pricing a noteworthy trend
- Flash estimates for property prices indicate that homes prices accelerated by 4.1% (non-landed) in 3Q22 while landed property prices stabilised at c.1.2%
- Over 9M22, the property price index is up 7.6%, with OCR index surging by c.11.3% followed by landed home prices which rose by 8.3%
- Recent cooling measures will likely weigh on transactions and overall price growth in 4Q22-2023
Morning!
URA released the property price flash estimates for the 3rd quarter of 2022.The index indicate an acceleration in the property price index (“PPI”) for the non-landed property segment accelerating by 4.1%, with homes in the outside central region (“OCR”) posting a noteworthy 7.0% q-o-q rise. Homes in the Core Central Region (“CCR”) and Rest of Central Region (“RCR”) rose by 2.3% and 2.5% respectively. The landed property segment posted a more modest 1.2% rise in 3Q22.
Taking into accounting the flash estimates, we note that on a year to date basis, prices in the OCR was the clear winner, with the price index rising by 11.3% followed by the landed homes prices which saw the index rising by c.8.3% year-to-date.
| Price Index (3Q22) | % Chg q-o-q | % Chg (year-to-date) | |||
| 2Q22 | 3Q22 | 2Q22 | 3Q22 | 9M22 | |
| All Residential (1Q09 = 100) | 180.9 | 187.1 | 3.5% | 3.4% | 7.6% |
| Landed Property | 211.3 | 213.8 | 2.9% | 1.2% | 8.3% |
| Non – landed property | 173.9 | 181.0 | 3.6% | 4.1% | 7.4% |
| Core Central Region | 141.2 | 144.1 | 1.9% | 2.3% | 4.1% |
| Rest of Central Region | 193.3 | 198.1 | 6.4% | 2.5% | 6.2% |
| Outside of Central Region | 208.4 | 223.0 | 2.1% | 7.0% | 11.3% |
Source: URA, DBS Bank
What are our views.
Index performance not a surprise, highlighting government prudent stance on overleverage. The rise in the property price index (“PPI”) do not come as a surprise given the robust prices seen in the new launches, especially in the OCR region with new launches seeing strong take-up with new benchmark pricing in the range of S$2,100 psf – S$2,300 psf, which are usually seen in the homes transacted in the RCR or CCR region. Going forward, with the government cooling measures, we expect transaction volumes to decline given tighter loan curbs coupled with a flattening out of the PPI in 4Q22 to 2023.
