New private home sales surge 82%
New private home sales surge 82%
Apr 18, 2017
March figure, the highest since June 2013, signals gradual recovery in sector, say analysts
Wong Siew Ying
Sales of new private homes defied expectations to surge to a near four-year high last month, when some property cooling measures were adjusted for the first time since they were first implemented in 2009.
Developers sold 1,780 new units - excluding executive condos (ECs) - up about 82 per cent from the 979 homes booked in February. This was also more than double the 843 homes shifted in March last year
Last month's strong showing took new home sales in the first quarter to 3,141 - the best quarterly effort since the second quarter of 2013, said consultancy CBRE.
Analysts said the sales figures released by the Urban Redevelopment Authority (URA) yesterday further point to a gradual recovery in the private residential property sector and are a huge boost to market sentiment. "This is reflective of a broad-based improvement in demand, with buyers not just attracted to newly launched projects, but also to those launched previously as well," noted Mr Ong Teck Hui, national director of research and consultancy at JLL.
Ms Christine Li, research director at Cushman & Wakefield, said: "With liquidity aplenty, waning concerns over the supply situation, buyers are coming back to the primary market in droves, as many are buying into the idea that Singapore's residential market is moving a step closer to a turning point."
Indeed, the level of new home sales last month has not been seen since June 2013, when 1,806 units were sold. Monthly sales cooled substantially after the Government implemented the total debt servicing ratio framework in June 2013.
Last month's robust sales were partly due to the slight easing of some cooling measures by the Government, which "have injected a shot of optimism among buyers", said ERA Realty Network key executive officer Eugene Lim.
The Government unexpectedly announced last month that it will shorten the seller's stamp duty holding period for homes bought from March 11 to three years instead of four years. It will also cut rates for each tier by four percentage points.
The two best-selling private projects were both new launches: CEL Development's Grandeur Park Residences in Tanah Merah, which sold 484 units at a median price of $1,406 per sq ft (psf); and Lendlease's Park Place Residences At PLQ in Paya Lebar. This moved 217 units at a median price of $1,805 psf.
"Buyers are more prepared to make a purchase, in view of prices possibly bottoming out. The impetus to procure land is becoming more urgent for developers as the unsold inventory of projects in the market is steadily being cleared," noted Mr Joseph Tan, executive director of residential services at CBRE.
The URA data showed that suburban areas led sales last month with 1,123 new units sold, followed by 589 in the city fringe and 68 in the core central region.
In the EC segment, developers sold 578 new units last month, up by about 76 per cent from February. This was driven by healthy sales at the new iNz Residences in Choa Chu Kang, which moved 187 units at a median price of $774 psf.
March's sales momentum is likely to carry through to coming months as several projects are due to hit the market.
These include Seaside Residences in Siglap, Artra in Redhill and Martin Modern in Martin Place.
Despite the surge in sales and the positive sentiment, it is premature to conclude that private home prices will increase this year.
Mr Nicholas Mak, head of research at SLP International Property Consultants, said: "Some developers may try to up prices to test the market, but it is not enough to move overall prices because only very selective well-located projects can pull off this strategy."
Developers' private home sales soar
Tuesday, April 18, 2017
by KALPANA RASHIWALA
THE latest government figures on private home sales point to a turnaround in the market.
Figures released on Monday showed that, in the primary market, developers sold 1,780 new private homes last month. This was the strongest showing since the 1,806 units they moved back in June 2013, when sales were still buoyant just before the rollout of the Total Debt Servicing Ratio (TDSR) framework towards the end of that month.
The March 2017 sales volume is up nearly 82 per cent from February's 979 units, and a 111 per cent jump from the 843 units sold in March 2016.
Last month's stellar showing was on the back of two well-received new launches (Grandeur Park Residences and Park Place Residences at PLQ), continuing sales in earlier projects (such as Parc Riviera, The Santorini and The Clement Canopy), as well as the confidence-booster from the government's maiden tweaks to the cooling measures announced on March 10.
The jubilant home-buying mood was reflected not only in the data from the Urban Redevelopment Authority (URA), based on its survey of licensed developers, but also in the secondary market.
Resale transactions of private homes rose to 942 units in March, translating to increases of more than 50 per cent month on month and year on year, going by JLL's analysis of URA Realis caveats data. The URA's definition of resales includes developers' sales in delicensed projects.
Summing up the overall mood uplift in March, Edmund Tie & Co's chief executive Ong Choon Fah said: "People are more optimistic that the worst is over, based on the strong turnout at state land tenders and the way developers have been bidding.
"And when the government tweaked the seller's stamp duty and the TDSR effective on March 11, the initial market reading was that it would not move the needle much, but it has certainly helped to boost sentiment."
Based on the latest data released by the URA yesterday, the preliminary Q1 2017 figure for new sales of private homes stands at 3,141 - up from 2,316 units in Q4 2016 and 1,419 units in Q1 2016; the Q1 2017 figure was also the strongest showing since Q2 2013's 4,538 units.
Developers also sold 578 executive condominium (EC) units last month, higher than the 329 units moved in February, and the 485 moved in March last year. The preliminary Q1 2017 new EC sales by developers is 1,091 units, surpassing the 734 units in the previous quarter and the 762 units in Q1 2016.
ECs are a public-private housing hybrid.
On the back of the stronger-than-expected March and Q1 new sales of private homes, some property consultants have revised their full-year forecasts upwards. JLL national director Ong Teck Hui expects an increase of over 20 per cent from the 7,972 units last year - if the current buying trend continues.
Cushman & Wakefield Singapore research director Christine Li has upped her forecast to 8,000-10,000 units, from 8,000-9,000 units.
Prices are expected to firm.
Ms Li said that developers have "not really made much downward adjustment to prices" except in selected projects with looming regulatory sales deadlines under the Qualifying Certificate and Additional Buyer's Stamp Duty rules.
In fact, she argued that last month's maiden tweaks to the cooling measures bridged the pricing gap. "Buyers are more willing to be price-takers after realising that sellers/developers are unwilling or unable to lower their asking prices."
CBRE executive director of residential Joseph Tan noted that demand for private homes has been muted in the past three years and prices have softened. "Those who have stayed on the sidelines for a clearer picture to emerge have decided to enter the market - drawn by the release of projects in good locations.
"Moreover, developers have been bidding aggressively to replenish their land and buyers see this as a sign that current home prices are still at reasonable levels."
In the resale market, based on anecdotal evidence, some owners have also started to be firmer about their asking prices because of the perception that prices are bottoming out.
ET & Co's Mrs Ong said: "This is especially the case for properties of up to S$1.5 million; for bigger-ticket properties, demand is still quite fragile because of affordability concerns, as the TDSR is still in place and because of the need to manage risks."
In the primary market, the best-selling private-housing project in March was Chip Eng Seng's Grandeur Park Residences next to Tanah Merah MRT Station, with 484 units sold at a median price of S$1,406 psf; this was followed by Park Place Residences at PLQ, where 217 units were transacted at a median price of S$1,805 psf.
ERA Realty Network's key executive officer Eugene Lim said: "Quantum remains a strong determining factor of sales, with small units the main contributor of sales at newly-launched projects."
Among ECs, Qingjian Realty's iNz Residence in Choa Chu Kang was the top seller; it sold 187 units at a median price of S$774 psf.
This month, developers' new private home sales are expected to be supported by at least two major new launches - Seaside Residences in Siglap Road and Artra next to Redhill MRT Station.
C&W expects sales momentum to remain relatively strong in the 1,000-unit monthly range in the coming months, with the expected launches of those two projects as well as others in Bukit Batok West Avenue, 6, Martin Place and Fernvale Road.
Last edited by reporter2; 3 Days Ago at 10:43 PM.