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Residential prices may have kept rising in Singapore through 2007, but activity slowed significantly in the last third of the year. However, the number of new launches in the Core Central Region (CCR) increased in December, bucking the trend in the other regions.

Compared to the 95 units launched in the CCR in November, the December figure rose to 247 units, a 160% increase, while the number of units sold also increased by some 37% to 175 units.

However, discounting those units in Goodwood Residence bulk purchased by the Kuwait Finance House, the resultant number of units launched was only 150, a more moderate 57.9% increase, while the number of units sold was 78, actually 39% lower. This adjusted number is more reflective of the cautious mood in the overall residential market, according to a report by Jones Lang LaSalle.

The looming uncertainty from the US subprime issue coupled with seasonal slowdown during the year-end period led to a contraction in the number of new launches and sales in both the Rest of Central Region (RCR) and the Outside Central Region (OCR).

In the RCR, launches registered a drop of 56% to 118 units, while there was an even wider decline in the OCR, which dropped 70%.to 61 units.

The islandwide demand, as reflected by the number of units sold, was some 50% lower for the month. Discounting the bulk purchases by institutional buyers, the December sales were 66% lower than November and 37.4% lower than even September, previously the lowest sales month on record since the series started.

The cautious sentiment caused by the uncertainty on the impact of the US subprime issue set the tone for buyers, who were generally more realistic and consistent with each other, resulting in the gap between the highest and lowest median selling prices being more moderate compared to previous months.

Jones Lang LaSalle’s gap analysis in the median price transacted showed a narrower band in the CCR and the RCR. The gap between the highest and lowest median selling prices was closer than in any of the previous months. The CCR registered a gap of only 8.2% in December as compared to 11.4% in November. Similarly, RCR registered 9.8% in December compared to the previous month’s wide gap of 25.7%.

The OCR, a mass-market region more sensitive to market sentiment, maintained the smallest gap of 5%. The buyers from this region are the most conservative compared to those in other regions.