Homebuyers were more cautious and realistic when paying for new properties last month, according to analysts' assessment of the latest data from the Urban Redevelopment Authority.
The figures showed the number of new properties sold in December was just half of those sold in the previous month. After peaking at 1,800 units in August, monthly sales of new private properties have dropped to just 291 units in December – half of the number of units sold during the previous month.
Property consultants said that is not unexpected, given the global credit crunch, slowing US economy and withdrawal of the deferred payment scheme.
Tay Huey Ying, Research & Consultancy Director, Colliers International, said: "What all this does to the mind of the potential purchasers is that it becomes very grey which direction home prices are going to take. So I think a lot of potential purchasers have preferred to stay by the side in the month of December, in view of the fact that it's the year-end holiday season.
"I guess a lot of them preferred to take a vacation and defer any purchase or any investment decisions to perhaps 2008 and very likely, after the Lunar New Year period."
Analysts said the data showed home prices were stabilising, with luxury projects such as The Ritz-Carlton Residences achieving a median price of about S$5,088 psf for the three units sold.
According to Jones Lang LaSalle, the gap between the highest and lowest median selling prices has narrowed from 15.8 percent in October to 8.2 percent in December for the core central region.
The out-of-central region properties have also seen its median price gap drop from 14.2 percent in October to 5 percent in December. That means fewer buyers are willing to fork out significantly more than expected market prices.
Dr Chua Yang Liang, Director & Head of Research, South East Asia, Jones Lang LaSalle, said: "I call it the buoyancy level. If you look in terms of the highest median versus the lowest median, and the behaviour over the last few months, the gap has kind of narrowed in the last two months, which indicates that buyers are more conservative."
That applies to both luxury properties in the core central region, as well as mass market properties.
Despite a slowdown in the fourth quarter, the number of units sold last year still came up to a historical record of 14,800. - CNA/so
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