Home sales sizzle despite cooling drizzle

[mr funny]

http://www.businesstimes.com.sg/sub/...47940,00.html?

Published April 16, 2010

Home sales sizzle despite cooling drizzle

Many buyers have HDB addresses; will more steps follow?

By EMILYN YAP


(SINGAPORE) Government measures to cool the property market have not doused the enthusiasm of buyers. Developers sold 1,761 private homes in March - 47 per cent more than the 1,202 in February.

This was disclosed in fresh figures from the Urban Redevelopment Authority (URA) yesterday. For the first quarter, sales hit 4,446 units - more than double the figure in Q4 2009 and up 67 per cent from Q1 2009.

Still, transaction volumes tell just half the story. Industry observers are keeping watch on how property prices are moving, as that will determine if the government implements more cooling measures ahead.

'If the sales volume continues to reach this kind of level, accompanied by strong increases in prices, especially if that happens in the mass market, I think there is a high likelihood that more measures will be introduced,' said Colliers International research and advisory director Tay Huey Ying.

March's sales figure of 1,761 units is a seven month-high, coming after the 1,805 units in August last year. The core central region (CCR) and the outside central region (OCR) saw the most activity, accounting for 41 per cent and 44 per cent of all transactions respectively.

There were at least six new launches in the CCR, such as 76 Shenton, Nathan Suites and Seascape. 76 Shenton chalked up the highest number of units sold, as buyers snapped up all 202 units at prices of $1,583-$2,559 per sq ft.

The highest transaction prices were seen at existing projects. A unit at Nassim Park Residences went for $3,465 psf, while one at The Orchard Residences went for $3,155 psf.

In the OCR, at least three new projects were launched: Parc Elegance, Primo Residences and The Vision. At The Vision, 236 units were sold at a median price of $1,050 psf.

Property consultants cited several reasons for the strong showing in March. For instance, the economy did better than expected and more new homes were made available. Developers pushed out 1,790 new units, 54 per cent more than in February.

Knight Frank chairman Tan Tiong Cheng added that February would be quieter because of Chinese New Year. Inevitably, sales in March would seem much stronger in comparison.

Many consultants reckoned that anti-speculation measures introduced in February for the private home market would not have much impact. As DTZ South-east Asia research head Chua Chor Hoon said, they were aimed only at a small group of buyers who might have overstretched themselves.

Colliers' Ms Tay even suggests that a separate set of cooling measures for the HDB market in March could have spurred private home sales. Her analysis of caveats for new sales showed that HDB flat owners made up 44 per cent of buyers in March, up from 33 per cent in February.

HDB upgraders may be rushing 'to lock in their private property purchases for fear of being caught in a double-whammy situation where private property prices rise beyond their means, and HDB resale flat prices fall after the government stepped in to curb speculative activity', she said.

The question now is whether strong private home sales in March will lead to more state intervention. Prime Minister Lee Hsien Loong said on Wednesday that the government will keep watch over the next few months to see if more action is needed. 'If we need to, we will. We have some instruments,' he said.

Most consultants BT spoke to do not think March sales will cause serious worry.

'The government is not as concerned about volume as about prices,' said Knight Frank's Mr Tan. 'And even more important is that the price increase has slowed down.'

Mr Tan was referring to flash estimates from URA two weeks ago, which showed that private home prices could have gone up by 5.1 per cent in Q1 from the previous quarter. This is lower than the 7.4 per cent quarter-on-quarter rise in Q4 2009. URA will release updated figures next Friday.

Barring any shocks to the property market, consultants expect robust sales to continue. Estimates for the total number of homes sold for the year range from 10,000 to 15,000.

'Sentiment is even higher now with the GDP growth forecast revised upwards,' said DTZ's Ms Chua. 'Some sceptics who had been holding back would be drawn into the market.'

CBRE Research executive director Li Hiaw Ho pointed out that the strong sales momentum in Q1 2010 has spilled over to April. Buyers have already bought more than 300 units at the launch of Waterbank at Dakota this month.

[mr funny]

http://www.straitstimes.com/PrimeNew...ry_515082.html

Apr 16, 2010

Private home sales still going strong

1,761 units snapped up last month despite the Govt's cooling measures

By Joyce Teo


SALES of new private homes leapt again last month, with more strong buying expected in the months ahead after the latest hot economic growth figures.

Home hunters picked up 1,761 units last month, up from 1,202 in February, bringing first-quarter sales to a higher-than-expected 4,446 units.

The quarterly total was way above the 1,860 units sold in the fourth quarter of last year, as demand for core city centre projects gathered strength.

Analysts noted that sales last month recovered to almost the level in August last year before the Government intervened to cool the market last September.

This suggests that cooling measures, which include requiring those who buy and sell a property within a year to pay stamp duty, may be losing steam as buying sentiment returns amid improved economic conditions, said Jones Lang LaSalle's head of research South-east Asia, Dr Chua Yang Liang.

In March, developers were just as enthusiastic as buyers, launching 1,790 new private homes, up from 1,161 a month earlier, according to data from the Urban Redevelopment Authority (URA) yesterday.

Launches of prime city projects surged last month, with 76 Shenton in Shenton Way selling out all 202 units on offer - at a median price of $1,900 per sq ft - in a matter of days. The brisk take-up at 76 Shenton was largely due to its location and small units, but not all projects that did well had only small units. At The Vision in the West Coast, for instance, the units start at 818 sq ft.

The 793 units launched in the core city centre was the highest since 2007.

Even more striking: The 701 non-landed units sold set a new record for the highest number of units sold in a month in the area, also known as the core central region, noted Jones Lang LaSalle.

'Demand in this region has so far been largely project-specific but March's performance is testament to a continued growth in the core central region,' said Dr Chua.

Mass market projects also did well last month, with the top seller being The Vision, where 236 units were sold at a median price of $1,050 psf.

The strong sales momentum in the first quarter has spilled over to this month, as seen by the rapid sale of more than 300 units of Waterbank at Dakota over one weekend, noted CBRE Research.

'If the pace of sales continues throughout the year, the total sales of new homes could even be comparable to last year's volume of 14,688 units,' said its executive director Li Hiaw Ho.

He said this week's figures showing stellar 13.1 per cent year-on-year economic growth in the first quarter and the Government's upward revision of estimated full-year growth to 7 to 9 per cent, from 4.5 to 6.5 per cent previously, is likely to mean much positive market sentiment in the coming months.

There will be no shortage of homes to keep the bumper figures rolling. Sizeable launches are expected at sites at Chestnut Avenue, Serangoon Avenue 3 and Lorong Ah Soo, for instance, he said.

DTZ's head of South-east Asia research, Ms Chua Chor Hoon, said low interest rates would entice buyers. 'More foreigners will be attracted to buy after looking at the fantastic GDP growth projections,' she added.

Looking ahead, property consultancy Savills Singapore expects to see more sales of homes priced above $3,000 psf.

Colliers International's director for research and advisory, Ms Tay Huey Ying, said some buyers of mass market projects may show resistance to higher prices, and this may affect sales to some extent.

However, she expects overall buying momentum to be strong this quarter.

But risks may arise in the second half. Dr Chua said the residential market is likely to keep forging forward, especially over the next few months as buyers race to lock in lower bank rates ahead of the expected interest rises by the second half.

But demand could pull back in the second half as higher financing costs set in and as higher prices make the market less appealing to foreign buyers, he said.

Total sales of homes this year could hit 10,000 to 14,000 units, depending on the overall domestic and regional economic performance as well as the aggressiveness of the Government's interventions in the market, he added.

Ngee Ann Polytechnic real estate lecturer Nicholas Mak said government land sales would sustain market activity in the short term and even contribute to growth in home prices.

But if the Government keeps providing ample supply of development sites, the result in the medium term would be slower price rises or even a potential glut if there is a sudden economic downturn, he said.

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