Resale home prices of both non-landed private residential units and HDB flats continued to climb to new highs in October and November against the third quarter 2012.
But according to data released by the Singapore Real Estate Exchange (SRX), the rental market for private homes is showing signs of softening.
As a result, overall gross rental yield dropped to a six-year historic low of 3.77% in the first two months of the fourth quarter.
Meanwhile, prices of private resale homes rose to $1,222 per square foot (psf) in the first two months of the fourth quarter, up 5.4% from the previous quarter's average of $1,159 psf.
The report found that resale prices of private homes rose across all regions, with non-landed homes in the suburban region seeing the sharpest increase at 4.5%, compared to the third quarter of 2012.
This is followed by a 3.3% increase in the city fringes and a 2.8% increase in the core central region.
Compared with the first two months of the third quarter this year, transaction volume rose by 6% to reach 2,483 resale transactions in the October to November period.
Meanwhile, the average unit monthly rent of private homes dropped by 1.0%, from $3.88 psf in the third quarter to $3.84 in the first two months of fourth quarter.
Leading the drop is non-landed homes in the city fringe where prices fell by 2.5% to $3.91 after rising for the first three consecutive quarters in this year.
The other regions remained relatively stable compared to the previous quarter.
Meanwhile, the report included for the first time data about the sales of small private apartments, commonly known as shoebox units in Singapore.
Year-to-date, just 198 shoebox units changed hands in the resale market.
But the report said there was strong demand for rentals of shoebox units, with 1,328 rental contracts signed this year. This represents 6.7 times more rentals than resales for shoebox units year-to-date. In contrast, the average is 2.4 times more rentals than resales for other types of units.
As a result, shoebox units continue to draw higher rental offers in the fourth quarter.
Source: Channel News Asia