Is URA’s Property Price Index Showing The Whole Truth? Read More...

Why is it that while URA’s Property Price Index (PPI) seems to be on the uptrend, your resale condo is unable to achieve an increased price?

Recently there was an article by 99.co about how HDB transactions are being skewed by the high prices of newer flats in each estate. Basically, the million-dollar price tags and the higher volume of such transactions have caused the HDB Resale Price Index (RPI) to rise. However, if one breaks down the data, one will see that the reality is that older flats are still losing their values. And this downward decline is being perpetuated by the supply of new flats as HDB buyers are forsaking old flats in favour of new ones. You can read the article HERE.

Property Science takes it one step further by asking:

Does the problem of LEASE DECAY apply to non-landed private properties as well?

Recently, there seems to be an uptick in PPI; is it time to celebrate and wait for a high offer for your condo unit which is being marketed for sale? In order to reveal the truth, we did an analysis of the data and broke down condominiums by age groups and the 3 regions – CCR, RCR and OCR. We defined what the PPI is based on; we also used psf and volume to more accurately reflect the trend line of Singapore’s condos.

Some of the findings were that:

The overall non-landed Average Weighted Psf trend behaves very differently from the PPI. While the PPI shows a downtrend from 2013 onwards, yet our findings reflected an upswing from 2013 to 2018 and a softening thereafter.
We found that not only does the age of the condo affect their performance, each region behaves differently. For example, it would seem that the overall performance of OCR shadows the PPI very closely. However, the RCR is on a downward trend. From here, we can draw some conclusions – due to the high number of transactions in the OCR, it would seem that the sheer volume has impacted the PPI the most, causing it to closely reflect the OCR trend-line.

If you have read to this point, you must be a sharp property watcher who is interested to know how this affects YOU. We have the charts and juicy details on WHEN and HOW to maximize your property portfolio. Contact Property Science here!