Loan restriction bite: New private home sales plunge 73 per cent

SINGAPORE - Sales of new private homes plunged to 481 last month, 73 per cent lower than June's figure of 1,806 units sold, excluding executive condominiums (ECs).

Including ECs, which are a public-private housing hybrid, developers found buyers for 593 homes in July - barely a third of June's figure of 2,119 homes.

The figures were released on Thursday by the Urban Redevelopment Authority based on sales data submitted by developers.

The top-selling project during the month was Vue 8 Residence in Pasir Ris, which moved 63 units, followed by Bartley Ridge at Mount Vernon Road with 25 units sold.

Industry watchers had anticipated the drop in sales transactions on the back of new loan curbs introduced in late June by the Monetary Authority of Singapore that put a cap on borrowers' total debt repayments relative to gross monthly income.

"With the new framework, banks are also taking much longer to grant in-principle loan approval. The longer waiting period could have removed some impulse buying," said OrangeTee Research & Consultancy.

The lack of new major project launches last month was another factor, it said. But buyers' appetite for reasonably priced projects at good locations is still very strong.

The latest mass market project, Tembusu, selling more than 200 units on the first day of its launch is testament to that, said OrangeTee.

"Nevertheless, home buyers and investors have turned more cautious and will be more selective with projects due to the cumulative effect of all the property curbs over the past few years," added the consultancy.

"As August is also a traditional Chinese Hungry Ghost month, developers are not in a hurry to launch any other project. We expect slow sales to continue into August, with transactions coming in at below 1,000 units."

But it expects transaction volumes to rebound in September and October, when new launches are "back in full force".

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