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Thread: Big drop in new private home sales

  1. #1
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    Default Big drop in new private home sales

    http://www.straitstimes.com/archive/...sales-20130316

    Big drop in new private home sales

    Published on Mar 16, 2013

    By Esther Teo Property Correspondent


    THE effects of the Chinese New Year last month and the cooling measures helped send sales of new private homes plunging to levels not seen for more than a year.

    Only 708 units were sold last month, 65 per cent down from January's sales of 2,016. If executive condominiums are included, 917 new homes were sold.

    The last time such anaemic figures were seen was in December 2011, when only 632 new homes found buyers.

    The culprit then was the additional buyer's stamp duty, which had just been imposed. This time, experts are pointing to unease over cooling measures and the Chinese New Year falling in an already short month.

    Developers had delayed launches until after the festivities. Only 261 new units were released last month - the lowest figure since January 2009.

    But the string of new projects lined up for this month and the positive sales response so far means that March sales will see a recovery.

    Launches include suburban projects like 332-unit Sennett Residence in Potong Pasir, The Trilinq in Clementi with 755 units, Urban Vista - a project of 582 homes in Tanah Merah - and the 912-unit D'nest in Pasir Ris which sold about 350 units yesterday.

    "The drop in February's new home sales is due to the cooling measures in January as potential home owners were likely to take a wait-and-see attitude," noted PropNex Realty chief executive Mohamed Ismail.

    CBRE's executive director of residential Joseph Tan said new home sales in March could be double last month's volume. "The total sales volume in 2013 is expected to fall from the historic high of 22,000 units in 2012, and whether there is any price correction remains to be seen."

    With the dust settling and developers starting to launch projects again, this month and coming months will be the real litmus test for market demand and the effectiveness of cooling measures, said Ms Chia Siew Chuin, Colliers International's director of research and advisory services.

    The Government will continue watching the market and policy risks remain, she added.

    ERA Realty key executive officer Eugene Lim noted that the economy remains stable with low unemployment and interest rates.

    Buyers might be encouraged to enter the market as more projects are launched and developers roll out promotions to cushion the impact of the cooling measures, he added. The sweeteners include partial absorption of the stamp duty and price discounts.

    In the absence of more severe cooling measures, private home sales - excluding exec condos - could vary between 3,000 and 5,000 units a quarter, said Mr Nicholas Mak, head of research at SLP International.

    This can be considered to be fairly healthy in this market.

    Last month's top-selling projects include d'Leedon - with 166 sales at a median price of $1,540 per sq ft - and Q Bay Residences in Tampines, which found buyers for 74 units at $1,041 psf.

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  2. #2
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    Default Curbs bruise February private-home sales

    http://www.businesstimes.com.sg/arch...les-20130316-0

    Published March 16, 2013

    Curbs bruise February private-home sales

    Volume lowest since December 2011; developers also hold back launches; market watchers expect sales to rebound this month

    By ong chor hao


    AFTER a solid showing in January, the private residential market beat a sharp retreat last month, as both homebuyers and developers took pause amid a double whammy of new cooling measures and a traditional lull period during Chinese New Year.

    Data from the Urban Redevelopment Authority (URA) yesterday showed that new private-home sales in February, excluding Executive Condominiums (ECs), fell to 708 units, down 65 per cent from the 2,016 units sold in January.

    This was the lowest volume since December 2011, URA data showed.

    Developers also held back launches, offering just 261 units - the fewest since January 2009. This was 86 per cent lower than the 1,802 units in January 2013.

    "February's numbers show that the cooling measures announced in January have taken effect, after the strong sales and launches in January," said Eugene Lim, key executive officer at ERA Realty.

    Analysts also cited the impact of the Chinese New Year holiday on purchases, as well as February being a shorter month.

    Mass-market residences continued to drive sales, with 341 units sold located in the Outside Central Region (OCR). Another 198 units were from the Core Central Region (CCR), with the remaining 169 units from the Rest of Central Region (RCR).

    OCR made up a smaller share of sales, at 48 per cent, compared with the 64 per cent in January. CCR gained ground to a 28 per cent share, up from 17 per cent, while RCR edged up to 24 per cent from 19 per cent.

    "These sales figures show that the cooling measures have discouraged cash-strapped homebuyers in the mid-tier and mass-market segments from overextending themselves," said Nicholas Mak, head of research at SLP International.

    Including ECs, a total of 917 new private homes were sold in February, compared with 2,272 units the month before.

    Sales of EC units eased to 209 from 256 in January. No ECs were launched last month.

    Just 12 new units in the CCR were launched in February, with another 115 units in the RCR and the remaining 134 units in the OCR. There was just one new project launch - Leville iSuites - last month.

    Analysts reckoned that developers were being cautious and assessing the impact of the cooling measures.

    "Developers probably took the chance to adjust their pricing and allowed more time for marketing efforts before launching their projects in March 2013," said Lee Sze Teck, senior manager for training, research and consultancy at DWG.

    The best-selling development in February was CapitaLand's d'Leedon, which moved 166 units at a median price of $1,540 per square foot (psf). Other popular projects included Q Bay - by Frasers Centrepoint, Far East Organization and Sekisui House - which sold 74 units; and CapitaLand's The Interlace with 33 units sold. For ECs, the top seller was Kheng Leong's The Topiary, with 84 homes sold at a median price of $730 psf.

    The highest psf price was achieved by a unit at Wing Tai Holdings' Le Nouvel Ardmore, at $4,372 psf.

    Market watchers expect sales to rebound in March to anywhere between 900 and 2,000 units.

    "The February figures are likely to be one-off and not indicative of a particular trend. We can expect to see some recovery in launch and sales figures in March as several major projects have already been launched and making sales progress," said Ong Teck Hui, national director for research and consultancy at Jones Lang LaSalle.

    Some projects launched this month include Tuan Sing Holding's Sennett Residence and IOI Group's The Trilinq.

    City Developments' D'Nest and Urban Vista by World Class Land and Fragrance Group both launched for preview yesterday.

    Chia Siew Chuin, director of research and advisory at Colliers International, said coming months will prove "the real litmus test for market demand and the effectiveness of the cooling measures".

    Joseph Tan, executive director for residential at CBRE, said the cooling measures may have been a boon for the EC market, which has been spared from a higher additional buyers' stamp duty and tighter loan-to-value limits.

    For the rest of the year, most analysts agree that sales will moderate from the record numbers achieved last year.

    "The increased purchasing and holding costs, and lower rental yields, stemming from the recent cooling measures and new property tax measures, coupled with ample supply conditions, will continue to put downward pressure on the new sale private residential market," said Alice Tan, senior manager for research at Knight Frank Singapore.

    But while buyers will be cautious, "value buys" such as well-located suburban condominiums that are attractively conceptualised and priced should still do well, said Ong Kah Seng, director at R'ST Research.

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