New private home sales up 54 per cent over July

PHOTO: New private home sales up 54 per cent over July

SINGAPORE - Developers moved more new private homes last month than expected. But sales were still relatively subdued, due to the number of launches put on hold for the Hungry Ghost Festival.

The sales lift looks impressive at first glance, with 742 units, excluding executive condominiums (ECs), sold last month - a rise of 54 per cent over July.

But July's numbers were in the basement after new cooling measures and tougher curbs on lending hammered the market. Only 481 new homes were sold then, 73 per cent lower than June's 1,806 units.

The slowing sales momentum can be seen more clearly by going back 12 months: Transactions of new private apartments in August last year hit 1,427 - 48 per cent more than last month.

Consultants said that despite the improvement from July to last month, Monday's figures still signal a cooling market.

The introduction of a total debt servicing ratio (TDSR) framework that caps a borrower's debt-to-income ratio will "haunt the market for a longer period, beyond the Ghost Month", said CBRE Research associate director Desmond Sim.

Jones Lang LaSalle Singapore research director Ong Teck Hui added: "The days of mega-launches with quick sell-outs may be over unless projects are 'priced to sell'."

If ECs are included, last month's sales came in at 1,468 units - a testament to the popularity of two project launches.

The 512-unit Ecopolitan EC in Punggol sold 335 units while the 380-unit Lush Acres EC in Sengkang sold 311 units - making them the top two sellers last month.

The Tembusu in Kovan, which launched in mid-August, was the top-selling private development, with 218 homes shifted at the 337-unit project at a median $1,547 per sq ft (psf), according to Urban Redevelopment Authority data out on Monday.

Next was the 141-unit Kensington Square, a mixed freehold development at the junction of Upper Paya Lebar Road and Jalan Lokam that launched last month. It moved 61 out of the 112 units launched at a median $1,511 psf.

Other launches last month included the 248-unit RV Residences in River Valley, a 999-year leasehold project. Its selling price was initially said to be $2,100 psf to $2,300 psf but that dropped to an average of $2,000 psf after early bird discounts. It sold 39 out of 83 units launched at a median $2,043 psf.

Consultants tip sales to pick up this month due to more launches, including the 726-unit The Glades in Tanah Merah and the 420-unit The Skywoods in the Dairy Farm area, both on 99-year leaseholds.

CapitaLand may also release Sky Vue, a 99-year leasehold project next to its Sky Habitat condo, later this month. Previews began last weekend and prices for the first phase range from $1,380 psf to $1,550 psf.

That makes it cheaper than its next-door neighbour Sky Habitat, where 172 units have been sold at an average price of $1,589 psf.

Colliers International research director Chia Siew Chuin said that since "tried and tested" incentives such as vouchers and rental guarantees were probably less effective after the TDSR, developers may change their sales strategies and lower prices. She expects new private home sales to be around 1,000 units this month.

Knight Frank research head Alice Tan said sales could also improve as banks gradually become more efficient at processing home loan applications.

She reckons new private home sales will be between 700 and 800 units this month, and could come in at 14,500 to 16,000 units for the full year - around 30 per cent lower than the record 22,197 new private homes sold last year.

Religare Institutional Research said on Monday that it expects new home sales to be around 17,000 units this year.

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