Ravi Chandran
Prime homes demand saw property sales jumping by 30% last month. Data released by the Urban Redevelopment Authority of Singapore (URA) showed that a total of 952 private homes were sold in May, up from 735 in April. Including May’s numbers, a total of 3,525 units have been sold year-to-date, out of 4,827 units launched year-to-date in 2019.
Commenting on the URA’s data, Colliers International Research said it expects take up to remain relatively healthy as more projects, including prime homes, could potentially be launched.
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“Colliers Research expects that takeup could ease slightly in June during the school holidays where sales activity typically slows, before picking up again in July ahead of the Hungry Ghost month which will begin in mid-August.
For the whole of 2019, Colliers Research estimates that 9,000 new residential units (excluding ECs) could be sold, up slightly from the 8,795 units in 2018.
Colliers Research expects takeup to remain relatively healthy as more projects could potentially be launched. These include prime projects: Haus on Handy (188 units), Jervois Prive (45 units); city fringe projects: Avenue South Residence (1,074 units), One Pearl Bank (774 units), Amber Sea (132 units), and suburban projects: Piermont Grand Executive Condominium (820 units).
We estimate that overall private home prices could stabilise in H2 2019, and rise by 1% for the full year 2019. Supporting factors that could hold up prices in the coming quarters include: halt in interest rate increases, continued benign economic growth, and en bloc beneficiaries buying replacement homes.”
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CBRE however suggested that it was not prime homes which is leading sales, but mass market projects.
“In general, sales have come to a relative standstill, with the exception of mass market projects which are still seeing sales due to their lower quantums. Developers continue to differentiate their projects with unique project features and better finishings. Ultimately, it is a question of how long they can afford to maintain prices at current levels as more launches come onto the market to compete for buyers. Should take-up remain at current levels, it is likely that developers might shave off some margins to launch at lower prices, especially for yet-to-be-launched projects, as well as those secured in the later stage of the en-bloc cycle.”
CBRE added that the top selling projects were Amber Park (155 units), Parc Komo (79 units), as well as The Woodleigh Residences (74 units). Units at The Woodleigh Residences were relaunched at lower PSFs, while the brisk sales at Amber Park are a testament to the reputation of the developer as well as the development’s attributes.
“At Parc Komo, quantum and tenure were the key selling points; with 94.9% of the units sold at under $1.5m. Given that it is now a buyers’ market with many choices available, only Amber Park had a stellar take-up of 97% of the units launched, with the rest registering less than 30% take-up. Additionally, it has been observed that some launches offered more attractive incentives to agents to push sales.”
Colliers said that on a year-on-year comparison, developers sold 15.2% fewer units as May 2018 had a major mass market launch, 520-unit Twin Vew, which sold 454 units at a median price of SGD1,385 psf. Comparatively, the launches in May 2019 comprised mainly prime homes and city fringe projects, or suburban freehold projects with prices above SGD1,400 psf, which could explain the slower year-on-year sales and lower takeup-to-launch rate.
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It added that “the nine new projects launched in May contributed to 29.8% of the total developers’ sales last month. Two new launches — Amber Park and Parc Komo topped the charts, while the bulk of the developers’ sales in May came from the earlier launches. Interestingly, The Woodleigh Residences, a relaunch, moved 74 units as median price was reduced 8.9% to SGD1,823 psf, compared to SGD2,002 psf achieved during its first launch back in November 2018, and only managed to sell 29 units then.”
Ms Tricia Song, Head of Research for Colliers International Singapore said that , “most buyers remain price sensitive and value-conscious, with the lowest priced projects in OCR – Riverfront Residences, Parc Botannia and Treasure at Tampines, and the lowest-priced in RCR – The Tre Ver continue to score 33 to 50 units per month.”
Mr Desmond Sim, CBRE’s Head of Research for Southeast Asia noted that “while May did not see any action in the EC segment, the upcoming Sumang Walk launch – Piermont Grand, will likely be well-received due to pent-up demand and the reputation of the developer.”
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