Developers sold 1,147 new private homes in November 2019

Figures released by the Urban Redevelopment Authority (URA) showed that developers sold 1,147 new private homes (excluding Executive Condos) (ECs) in November 2019, rose by 23.2% from the restated 931 units transacted in the previous month, even as launches declined 17% MOM to 740 units.

On a year-on-year basis, new home sales were a slight decline of 4.5% from the 1,201 units shifted in November 2018, where there were eight new launches as sentiment recovered four months after the cooling measures in July 2018.

November’s sales numbers took overall new home sales to 9,547 (excl. ECs) for the first 11 months of 2019 – up 10.2% from 8,662 units transacted over the same period in 2018.

Colliers Research projects that new home developers sold in 2019 will likely reach 10,000 units, surpassing the 8,795 units (excl. ECs) transacted last year.

It added that mixed residential developments took the limelight in November as Sengkang Grand Residences and One Holland Village Residences were among the top three best projects developers sold in November. Both also set benchmark prices for 99-year leasehold projects in their locality, reflecting good demand, despite a price premium, for well-located projects that also combine convenience and community.

The best selling private residential projects among units developers sold in November were: Sengkang Grand Residences which sold 235 units at a median price of SGD1,741 psf; Parc Esta which moved 102 units at a median price of SGD1,685 psf; One Holland Village Residences which transacted 87 units at a median price of SGD2,604 psf; Jadescape which shifted 60 units at a median price of SGD1,679 psf; and Parc Botannia which saw 59 units changed hands at a median price of SGD1,341 psf.

Top 10 Selling Projects in November 2019 (including EC)

Source: Colliers International, URA

5 new launches in November 2019

Source: Colliers International, URA

Ms Tricia Song, Head of Research for Colliers International Singapore, commenting on the units developers sold said:

“Despite the global trade and geopolitical uncertainties, we believe demand for Singapore private homes is still relatively stable given the tight labour market, favourable interest rate environment, and relatively healthy household balance sheet.

In November, two of the top three best-sellers were mixed developments which show good demand for such projects. Value-conscious home buyers continue to dip into earlier-launched projects which now look attractive after benchmark prices of latter launches.

We expect prices to continue to stabilise and rise by 2.5% for the full year 2019. Prices will likely be kept in check with the economic slowdown and an ample pipeline. As of end-November, there are also 4,323 private homes (excl. ECs) that have been launched but still unsold.

December could see slower sales due to the festivities and holidays. We expect developer sales could touch 10,000, surpassing 2018’s 8,795, but still lower than 2017’s 10,566 units.

We estimate 2019 to have seen bumper new launches, with over 17,000 units in total among them. Takeup rates have been mixed, but we expect takeup to gradually improve over the next few years as the launch pipeline has peaked.

In 2020, we expect fewer new private residential launches of about 41 projects with 9,000 units in total, and barring a worse-than-expected economic slowdown, takeup should be similar to 2019 at 9,800 units. Prospective buyers would likely dip into earlier launches for choices. With a projected slightly better economic growth than 2019, we expect the private residential price index to grow 3%, in line with the economic growth.

Some of the largest launches in 2020 would probably be the most watched, these include: KI Residences (former Brookvale Park), 648 units; Leedon Green (former Tulip Garden), 638 units; and the Tan Quee Lan site, 580 units.”

Orange Tee & Tie commenting on the units developers sold in November 2019 said, “Developer home sales are expected to end on a stronger note this year. Our earlier optimism for the private residential market is proven to be true with more sales inked in the first 11 months of 2019 when compared to the whole of last year (8,795 units). Based on preliminary estimates using URA data, 9,547 new homes excluding executive condominiums were sold from January to November this year (i.e. 7,469 units sold in Q1-Q3, 931 units in October and 1,147 units in November). Given that the average number of units sold in the month of December for the last six years was about 380 units and taking into account lapsed options or ‘returned units’, we estimate that between 9,500 and 10,000 units could be sold in 2019.”

It added: “The U.S. and China had reached a phase-one trade agreement in principle, which may help de-escalate trade tensions and boost market confidence. We anticipate that the next wave of inbound capital may continue to enter Singapore’s property market next year with more Chinese capital flowing south. Further, an increasing pool of investors around the world are diversifying their investment portfolios by location and sectors, and Singapore will continue to be featured prominently as one of the top investment destinations. Further mortgage rates may remain low or clock in even lower next year, which may keep housing demand to ‘cruise’ at current levels. As such we estimate that between 9,000 and 9,800 new homes excluding executive condominiums could be transacted in 2020.”