Private homes continue to be snapped up with new offerings from developers
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[SINGAPORE] Though they didn’t quite touch the record-smashing levels of February, private homes sales continued to remain high in March as they were powered by new launches. The government will release six more residential sites this month to appease the growing appetite of developers and buyers.
The possibility that more cooling measures may lie in store has also been raised.
Urban Redevelopment Authority (URA) reported a total of 2,393 private homes – excluding executive condominiums (ECs) – being sold in the month of March, a mere 1 per cent fall from February. Still, this number was 73 per cent higher than in the same period a year ago, reflecting strong underlying demand for new private homes.
This brings the total number of private homes (excluding ECs) sold to 6,682 in the first three months of 2012 – a record for quarterly sales since 1Q 1996 when quarterly data was first compiled and around 41 per cent of the total volume sold in 2011.
New launches have been driving demand, observers say. An eye-popping 2,582 units (excluding ECs) were launched in March.
Said Credo Real Estate executive director Ong Teck Hui: “There is a clear trend of sales launches for private homes picking up … For the last three consecutive months, launches have exceeded 2000 units per month while in 2011, only April exceeded 2000 units.”
Mr Ong also added that if this trend continues, land supply under the government land sales (GLS) programme might have to be reviewed to cope with the spiralling demand.
Sales of ECs also remained at high levels, with 639 units sold in March, slightly lower than the 725 units in the month before, but still more than four times the volume transacted in the same period last year.
Including ECs, the total number of new private homes in March reached 3,032 units.
Units were snapped up in both new launches and projects launched earlier.
Among the new kids on the block, top-sellers included Ripple Bay (326 units sold at a median price of $883 psf), Palm Isles (102 units sold at a median price of $860 psf), Seletar Park Residence (98 units sold at a median price of $1,162 psf) and East Village (83 units sold at a median price of $1,309 psf).
Among projects launched earlier, The Minton (118 units sold), Riversound Residence (115 units sold), Archipelago (93 units sold) and Bartley Residences (86 units sold) saw strong demand.
Though no new ECs were launched in March, buyers – especially upgraders – continued to buy, with The Tampines Trilliant and Twin Waterfalls transacting 369 units and 153 units respectively.
Developers are likely to continue riding the selling momentum with new launches, says Chua Chor Hoon, Head of Asia Pacific Research at DTZ. “Even if monthly purchase activity were to drop by half for the next nine months to a more sustainable level (of about 1,200 units a month), total primary sales would still exceed that of last year,” she said.
Demand for higher end units also seemed to become more resilient to the cooling measures, with almost twice as many homes in the above $2,000 psf range being sold in March, compared to February.
The priciest unit sold by a developer for the month was an apartment at Skyline@Orchard Boulevard, which transacted at $4,442 psf.
The bulk of properties sold in March remained in the $1,000 to $1,500 psf range, similar to the month before.
The mass-market outside central region (OCR) continued to dominate demand, with a total of 1,825 OCR units (excluding ECs) sold, just seven units less than the 1,832 homes transacted in February.
“This is the first time we have seen OCR sales sustaining above 1,500 units for three consecutive months,” said Chua Yang Liang, Jones Lang LaSalle’s head of research (South East Asia). “Going by this rate of demand, we are looking at an average (3-month moving average) of 1,806 units, equivalent to an annualised demand of 21,672 in the mass market segment alone.”
Developers continued focusing on this segment, with OCR seeing 2,119 new units launched, some 35 per cent higher than the month before.
Mohamed Ismail, CEO of PropNex Realty also pointed out that though consumers still take keenly to mass market OCR developments, developers may soon face resistance from buyers should prices continue to rise.
Another alternative – more cooling measures – has also been touched upon. Chia Siew Chuin, director of research & advisory at Colliers International noted, however, that it would be “premature” at this stage to roll out new interventions. She noted that in such a market, price movements may serve as a “better yardstick” for more measures as opposed to sales volume alone.
Meanwhile, more launches are on their way in the months to come. These include UOL’s 244-unit Katong Regency, Allgreen’s 928-unit Riversails, Far East’s 338-unit Seahill and Hoi Hup’s 376-unit Sea Esta.
Source: Business Times 17 April 2012