Amid a dearth of launches, developers sold 653 new private residential units, excluding executive condominiums (ECs), in Singapore this April.

This is largely unchanged from the 654 sold in the previous month, according to data released by the Urban Redevelopment Authority (URA) on Tuesday (May 17).

However, property analysts anticipate sales momentum to pick up soon, led by major new condominium projects such as the 407-unit Piccadilly Grand and the 298-unit Liv @ MB.

Compared to a year ago, last month’s new sales excluding ECs sank by 48.6 per cent from the 1,270 transacted in April 2021, when there had been 4 property launches.

Huttons senior director (research), Lee Sze Teck, highlighted that monthly new sales in 2022 thus far have hovered between 650 and 700 units, amid the festive season and the absence of major launches.

Christine Sun, senior vice-president of research and analytics at OrangeTee & Tie, noted that there were no major launches last month besides the 616-unit North Gaia, an EC project.

New home sales also “seem to have stabilised”, some 4 months after the latest round of cooling measures were implemented on Dec 16, she added.

Catherine He, Colliers’ head of research, Singapore, attributed the “healthy” new home sales to buyers being motivated to lock in mortgage rates ahead of further interest rate hikes, pent-up demand after the cooling measures, and demand from upgraders on the back of strong Housing Board (HDB) resale flat prices.

URA data showed that the rest of central region (RCR) or city fringe clocked the highest new sales volume with 289 units moved this April, followed by the core central region (CCR) with 206, and the outside central region (OCR) or the suburbs with 158 units.

It marks the first time in 12 months that new sales in the CCR exceeded those in the OCR. “The low level of unsold stock in the OCR meant that buyers have increased their budget and traded up to the next tier of private housing in the RCR or CCR,” Lee said.

That also increased the proportion of transactions priced at S$2 million and above to 54.8 per cent, which is the highest level seen in at least a year and points to ample liquidity in the market, he added.

Sun observed that at the upper end of the private residential market, the cooling measures did not appear to have deterred buyers’ appetite for luxury homes. Going by URA Realis caveats data, transactions of at least S$3 million rose to 115 units last month, up from 89 units in March 2022. Sales of private homes costing S$5 million or more increased to 35 units over the same period, from 24 units previously, she said.

Including the 186 EC units sold, developers moved a total of 839 new homes in April this year. That is an increase of 19.5 per cent from March’s 702 transacted units.

The North Gaia EC project in Yishun sold 166 homes or 26.9 per cent of all available units.

Besides North Gaia, other best-selling projects in April included Normanton Park, Riviere, One Pearl Bank and The Florence Residences, Sun said.

As for launches, 397 new private homes – excluding ECs – were put on the market last month, about 28.5 per cent more than the 309 units launched in March.

Launch volumes including ECs surged to 1,013 units last month. Developers did not offer any EC units in the primary market in March.

Analysts expect new sales of private homes to climb in the coming months. Leonard Tay, head of research at Knight Frank Singapore, foresees April 2022 to be “the last month when the market remains in a state of pause” in the wake of the Dec 16 cooling measures.

The launch and sales momentum at Piccadilly Grand in May, with 315 units moved in its first weekend, as well as the number of visitors at the Liv @ MB showflat “should now encourage developers to start launching projects, as it is clear that there is underlying demand for new products despite the cooling measures”, Tay said.

Lee from Huttons wrote that new sales this May could exceed 1,000 units on the back of 4 launches: Piccadilly Grand, Atlassia, Baywind Residences, and Liv @ MB. In his view, Piccadilly Grand “set the tone for the market for the rest of the year”, as it sold 77 per cent of its 407 units at an average of about S$2,150 per square foot (psf) on launch day.

With construction costs spiking, project launches at prices close to S$2,000 psf will likely become the norm, and overall prices of private homes may increase up to 3 per cent this year, Lee added.

Colliers’ He noted that Piccadilly Grand and Liv @ MB will further boost sales and prices in the RCR.

She forecasts new home sales to moderate some 20 to 30 per cent from the 13,027 units recorded in 2021, to around 10,000 units this year. This is considering that macroeconomic uncertainties, higher additional buyer’s stamp duty rates and rising mortgage rates will continue to weigh on the sentiment of prospective buyers.

Tay of Knight Frank said new sales volumes are likely to start catching up and remain on track to reach 8,000 to 9,000 units for the whole of 2022.

Credit: Business Times