Sales of new homes slowed done dramatically last month. In all, a total of 185 units were sold in February, almost half of the 328 units sold in January.

The lacklustre performance, together with the increasing quietness of the market this month, prompted some experts to predict that new home sales this quarter could hit one of the lowest levels ever seen in Singapore, probably in the 700 to 800 range. ( during Asian financial crisis, 894 new units were sold in last quarter of 1997).

In comparison to the boom last year, where developers sold 14811 units or 3700 units on average each quarter, this looks like another slow year ahead. The global financial crisis originating from the United states seems to have taken its impact on us. Market confidence remain shaky until the extent of the US recession can be measured.

Recent data release by Housing Development Board ( HDB ) shows that 86% of all resale transactions in the fourth quarter of 2007 required cash payments over valuation, up from 80% in the previous quarter.

As compared to the 3rd quarter of 2007, we see a 13% drop in the number of flats sold to 6700. This can be quite expected as in most years, sales do tend to slow down towards the end of the year with the arrival of festive seasons and school holidays. For the whole of 2007, a total of 29436 flats were transacted.

2007 concluded with resale prices rising a spectacular 17.5%, which happens to be the biggest growth for HDB resale flats in a decade.

Will we see a repeat of growth for 2008? We’ll see…. It is however made known by HDB that at least 4500 new flats will be release in the first half of 2008 for buyers worried about the increasing prices of resale flats.

Prices for luxury and high end homes in the central areas may be showing signs of slowing down, but this is not so for homes found outside the city areas. According to figures from the Urban Redevelopment Authority, growth in the prices of uncompleted projects in the central areas slid from 7.8% to 7.6% in the last quarter of 2007. However, price increases were seen for city fringe units, rising from 7.6% to 8.3%. And for uncompleted apartments in suburban areas, there was a rise from 9.1% to 9.2%.

Dr Chua Yang Liang, head of research, South-east Asia, at Jone Lang Lasalle, said home prices in the suburbs would keep growing by 24% to 26% this year. THis would be supported by home owners looking for new homes after being disloged by collective sales.

Last year, 14811 new homes were sold.

Mr Li Hiaw Ho, exercutive director of research at CB Richard Ellis, meanwhile, expects price rises and sales volumen to moderate this year.

"Luxury prices are likely to stabilise at current levels, while mid-tier and mass market prices may have the potential to rise by 10% - 15%," he said.

remarks- extract from The strait Times