SINGAPORE (EDGEPROP) - The National University of Singapore’s Singapore Residential Price Index (NUS SRPI) reported that its main index, SRPI Overall fell 0.3% m-o-m in October.

Nicholas Mak, head of research at ERA Realty Network, says, “After increasing 3.5% for three consecutive months from June to September this year, the Overall SRPI slipped in October as the robust rate of growth from June to September was not sustainable.”

The flash estimate of SRPI sub-index for the CCR dropped 0.7% from September to October, while the flash estimate of SRPI sub-index for the non-central region remained unchanged in the same time.

Mak notes that resale properties in the prime districts lead the marginal price decline, and attributes it to the lack of major residential project launches in the CCR in the past five months. Instead, more residential projects have been launched in the city fringe, such as Forett at Bukit Timah, Penrosen and Verdale.

Don't miss out to check out the hottest new launch condo and new landed property in Singapore

Additionally, the SRPI for small units increased 0.9% in the three-month period from June to September, which is the slowest rate of growth compared to the other sub-indices, observes Mak.

He says that this could be due to a chain effect as a result of lower residential leasing demand, due to the Covid-19 pandemic. “The buying demand for small units depends more on investors compared to the other types of housing. Since residential leasing demand is adversely affected by the Covid-19 pandemic, the demand for small units is also impacted,” he says.

With the current development of Covid-19 vaccines, Mak expects that the weakness in the SRPI in October to be a “temporary pause”. If the pandemic is brought under control next year, he believes that the overall SRPI will likely increase by 4% to 6% for the whole of next year.