“This was the largest quarterly negative magnitude registered since 2Q09, when prices fell 5.2% q-o-q,” Wong adds.
Prices for non-landed residential property in the Rest of Central Region (RCR) dipped slightly by 0.2% q-o-q, while prices for non-landed homes in the Outside Central Region (OCR) held steady.
According to URA flash estimates, PPI declined 0.6% q-o-q in 1Q19, following a 0.1% q-o-q dip in 4Q18.
“The landed property segment was resilient during 1Q19, with an uptick of 1.1% q-o-q, while the non-landed property segment suffered a decline of 1.0% q-o-q,” Wong notes.
Moving forward, the analyst says recent URA land tenders have showed signs of “more rational bids” amid the property cooling measures.
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Tenders for two sites that were recently closed – a residential land parcel at Sims Drive and a residential land parcel with commercial at first storey at Middle Road – were won with top bids that worked out to per square foot (psf) per plot ratios (ppr) of approximately $732.0 and $1,458.3, respectively.
In contrast, Wong says the nearby Duo Residences registered average selling prices (ASPs) of around $2,211 psf for transactions done after the July 2018 cooling measures, while the higher-end South Beach Residences garnered average ASPs of approximately $3,371 psf.
“We keep our private residential price growth forecast of -3% to 2% for 2019, but highlight that the full-year figure is likely to come in at the lower-end of our projection,” Wong says.
OCBC’s preferred picks within the sector are UOL Group and CapitaLand.
The brokerage has “buy” calls on both, with fair value estimates at $8.45 and $3.98, respectively.
As at 12.20pm, shares in UOL are trading flat at $7.11 while shares in CapitaLand are trading 1.08% down at $3.65.
