http://www.businesstimes.com.sg/prem...ugust-20120918

Published September 18, 2012

Private home sales down 27% in August

Developers defer major launches due to Ghost Month

By Felda Chay


[SINGAPORE] A dearth of major new project launches in August as developers avoided the Hungry Ghost month led sales of private residential homes, excluding executive condominiums (ECs), to fall 27 per cent from a month ago.

URA's monthly developers' sales statistics for August showed that 1,421 units were snapped up last month, lower than the 1,946 in July. Property consultants say that the drop in sales was expected because the Hungry Ghost month typically sees slower transactions, and that sales figures this year are still expected to smash last year's record.

What is noteworthy, they say, is that the lack of fresh launches sparked an interest in homes of projects that were first launched before August. Just one in three of the 1,118 homes launched in August were from new projects - which in turn made up just 14.5 per cent of the 1,421 units sold.

Said Ong Teck Hui, Jones Lang LaSalle's national director research Singapore: "This is in stark contrast to the earlier months in the year when fresh launches accounted for the bulk of new supply for almost every month." In total, the number of launches - in new and older projects - fell 37 per cent from a month ago, and boasted a take-up rate of 127 per cent - suggesting that "demand strongly outweighed supply", said Mr Ong.

Eugene Lim, key executive officer of ERA Realty Network noted that the drop in sales is unlikely to steer the market away from its path of recording the highest number of sales in a year.

"Due to the sales volumes exceeding 2,000 units for February to April, the overall average so far this year is 1,950 units, still well above the long run average of 1,500 units sold per month."

He added that September's sales figures are likely to shoot up again as a slew of launches typically hits the market immediately after the Chinese seventh month.

Savills Singapore research head Alan Cheong said that sales in September will be dictated by whether AllGreen Properties' 920-unit project, Riversails, can be launched this month.

If not, then all eyes will be on the performance of 752-unit eCo, and Skies Miltonia, which has 420 units. eCo is a joint residential development by Far East Organization, Frasers Centrepoint and Seikisui House, while Skies Miltonia is by TG Development and Master Contract.

"In all likelihood, September may well turn out to see sales hover around 1,600 to 1,800 units, with the bulk of buying coming, as was the case for August, from projects launched earlier," said Mr Cheong.

August saw a jump in interest for projects in the mid- to high-end segment compared with July, with 28 per cent of units sold at prices above $1,500 per square foot (psf), noted Colliers International. In July, 18 per cent of sales were for mid- to high-end projects.

Notably, a unit at SC Global Developments' The Marq on Paterson Hill was sold for $4,921 psf, the highest median price achieved for a private residential apartment this year.

"This is encouraging for the high-end/luxury sector, which has seen muted activity since the announcement of the Additional Buyers' Stamp Duty last December," said Chia Siew Chuin, director of research & advisory at Colliers International.

Sales in Outside Central Region (OCR), where mass market projects are located, fell by 45 per cent to 835 units as there were no new mega mass-market projects launched in August, but take-up in the Rest of Central Region (RCR) bucked the trend by seeing a higher number of units sold in August compared with July.

"This is mainly due to a newly launched project, One Dusun Residences, which sold all but one of its 154 units at the median price of $1,532 psf," said Li Hiaw Ho, executive director of CBRE Research.

One Dusun Residences was the top-selling project in August by volume. The smallish, mixed-use freehold development is a joint venture by the Nobel Design Holdings, 2E Capital and Lian Huat Group.

Meanwhile, activity in Core Central Region (CCR) "remained fairly healthy", said Mr Li, noting that the newly launched Leedon Residence by GuocoLand saw 27 units taken up at the median price of $1,970 psf. Three units of SC Global's Hilltops were sold at $3,298 psf.

In the CBD, 65 units of UIC's 510-unit V on Shenton were sold at $2,927 psf, bringing its total sales to 206 units since its launch in July.

In total, 15,295 homes have been sold this year, compared with 15,904 for the whole of last year.

In the EC market, 118 units were sold in August, all of which were from existing projects as there were no new launches during the month. This is slightly fewer than the 124 ECs sold in July.

Some 2,668 ECs have been sold in the year, 7 per cent lower than the 2,883 ECs sold in 2011.

"Although the sales momentum in the EC market has slowed down since the beginning of the year, there is still interest because their prices are relatively more affordable than private condominiums," said Mr Li.