Property market may finally be recovering

This article is more than 12 months old

More sales and higher prices last month have sparked talk that the property market could be on the cusp of recovery after a three-year slump.

Resale prices of condominiums rose 0.4 per cent last month over April while the number of transactions shot up 17.4 per cent, according to SRX Property flash estimates yesterday.

Prices were ahead 1.5 per cent from April last year.

SRX Property said last month's uptick in resale prices followed a revised 0.2 per cent decline from March to April.

The increase was led by improvements in the core central and city-fringe region - each rose 1.1 per cent from April - but the suburbs recorded a marginal price decline of 0.4 per cent from April to May.

The big mover came in the area of transactions with 1,235 private condos resold last month - up a striking 57.7 per cent from the 783 shifted in May last year and 17.4 per cent ahead of April.

Despite the better numbers, views are mixed.

"The market has turned after an overextended downcycle... I believe prices will rise gradually over the course of the year," noted Mr Alan Cheong, head of research at Savills Singapore.

Dr Lee Nai Jia, head of South-east Asia research at consultancy Edmund Tie and Company, added: "The price trend, together with the diminishing supply of unsold units in the primary market and higher land bids, do suggest that market has bottomed and stabilised."

But consultancy OrangeTee told The Straits Times that it is premature to make that call owing to the challenging leasing market.