Private home sales surge in July is an anomaly suggested leading real estate services companies. 1,724 private homes were sold in July 2018 said the data released by the Urban Redevelopment Authority (URA) on Wednesday. These figures are about 2.6 times more than the 654 units sold in June 2018 and up 55 per cent from the 1,112 units they sold in July 2017. URA said its numbers were based on its survey of licensed housing developers.
Sales and launch volumes
JLL, a leading real estate service company, said that the private home sales surge in new private home sales was due to the sudden launch of several projects to clinch sales before the higher ABSD and lower LTV rates took effect on 6 July 2018. 2,239 new private homes were launched in July, more than threefold that in June 2018 and in July last year as well.
Five new private residential projects came onto the market in July:
- Riverfront Residences launched 800 of its 1,472 units, selling 628 at a median price of $1,307 psf
- Park Colonial launched all of its 805 units and sold 429 at a median price of $1,756 psf
- The 1,259-unit Stirling Residences launched 380 units, finding buyers for 339 at a median price of $1,746 psf
- Daintree Residence launched 80 of its 327 units and sold 46 at a median price of $1,716 psf
- One Tree Hill Collection launched and sold one of its 14 units at $$3,532 psf
Top selling projects
The top four selling private residential projects in July were Riverfront Residences, Park Colonial, Stirling Residences and Daintree Residence while fifth spot was taken by Affinity at Serangoon which sold 45 units at a median price of $1,496 psf.
Executive Condominium (EC) market
Developers sold 52 new ECs in July, similar to those in June. New EC sales remained low due to the absence of new launches. EC projects garnering more sales in July include Rivercove Residences (19 units at median price of $958 psf), Northwave (17 units at median price of $861 psf) and Parc Life (11 units at median price of $884 psf).
Mr Ong Teck Hui, National Director of Research & Consultancy at JLL, noted that the 1,724 private residential units sold by developers in July are the highest monthly sales this year and the highest since March 2017 when 1,780 units were sold.
Mr Ong believes that the strong private home sales surge may not be indicative of an uptrend in new sales volume.
He said: “Analysing caveats based on their dates of sale in URA Realis, about 61 per cent of new private home sales in July were recorded before the cooling measures took effect on July 6. Most of the sales are attributable to the sudden launch of Riverfront Residences, Stirling Residences and Park Colonial on the evening of 5 July, to beat the cooling measures.”
Mr Ong noted that the pro-rating post 5 July, new private home sales surge for the full month based on caveats show sales momentum being roughly maintained in July compared to the monthly average for 2Q18.
And added: “This is probably due to abundant opportunities in the primary market for buyers due to the strong launch volume in July. However, an analysis of secondary market caveats in July shows a significant slowing trend compared to previous months. As the July new sales volume is a one-off aberration, moderated monthly sales figures are likely to be seen for the rest of the year, taking into account the more cautious mood of both buyers and sellers, although realistically priced projects are expected to achieve better sales take-up.”
|Table 1:Total island-wide (landed and non-landed excluding ECs) units sold by developers|
|Jul-17||Jun-18||Jul-18||m-o-m change||y-o-y change|
|Source: JLL, URA|
|Table 2: New Launches (ex. ECs)|
|Locality||Development Name||Lowest Price
|CCR||One Tree Hill Collection||$3,532||$3,532||$3,532||1||1||100%|
|Source: JLL, URA|
Commenting on URA’s July 2018 private home sales surge, CBRE said: “New private home sales (excluding ECs) for July came in at 1,724 units on the back of 2,239 units launched, supported by sales at Riverfront Residences (628 units), Park Colonial (429 units), and Stirling Residences (339 units). It should be noted that Park Colonial and Stirling Residences brought forward their launches to the day when the cooling measures were announced, which contributed to the highest number of units launched(3,489 units) in a single month since March 2013. Together, these projects accounted for 81% of July sales.”
Desmond Sim,CBRE”s Head of Research, Singapore & SEA, said: “Unsurprisingly, based on caveats lodged, close to a thousand units (1,039 units), or about 60% of the total were lodged on 5 July, the eve before the new cooling measures came into effect. While this short-term spike can be attributed to frantic buying to avert the measures, the sales momentum carried on past the effective date, albeit at a slower pace.”
Adding: “Going forward, buying will likely be driven by genuine owner-occupier demand. While it was reported that some developers have given discounts to boost sales, CBRE expects new sales volume to moderate in the following months as buyers are likely to extend their decision making process. In addition, several projects in the high end segment are reported to have delayed their launches; sales activity might also be spooked by the hungry ghost festival. Nonetheless, CBRE expects full year sales numbers to be around 8,000 – 10,000 units.”
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