Singapore Home Sales Drop to Lowest Since 2009 on Toughest Curbs

Singapore’s home sales plunged 82 percent in December from a year ago, ending the year at the lowest since 2009, as the government implemented its toughest measures to curb record prices.

Home sales slid to 259 units last month compared with 1,410 in December 2012, according to data from the Urban Redevelopment Authority released today. The monthly figure was the lowest since January 2009, the data showed. Annual sales dropped 33 percent to 15,301 units, a four-year low.

The government introduced loan measures in June as it widened a campaign that started in 2009 to curb speculation in Asia’s second-most expensive housing market. Singapore’s property market is stabilizing and the country isn’t facing a credit bubble that puts the island or its banking system at risk of a crisis, the central bank said today.

“The measures have impacted sales last year especially after the loan curbs in June,” said Lay Keng Lee, head of Singapore research at DTZ. “We don’t see a rollback of the measures yet as it is too early for that, so sales may decline to between 12,000 and 15,000 units this year.”

Singapore unveiled new rules in June governing how financial institutions grant property loans to individuals, in addition to previous curbs including new taxes and higher down-payments.

Fourth-quarter home prices in the island-state slid for the first time in almost two years, trimming annual gains to the smallest since 2008, a separate preliminary URA data showed earlier this month.

New housing loans have declined and household balance sheets are strong, the Monetary Authority of Singapore wrote in an e-mailed statement to Bloomberg News today after a Forbes article this week said the city is headed for an “Iceland-style meltdown.”

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