Developers trying to launch earlier to beat competition from coming mega projects

Last month, higher month-on-month sales were seen for projects including Stirling Residences, among others. PHOTO: LIANHE ZAOBAO

SINGAPORE – Developers released for sale 596 private homes last month, nearly 200 per cent more than a year ago, and up nearly 20 per cent from the previous month’s 498 units, according to figures released by the Urban Redevelopment Authority (URA) on Friday (March 15).

On the take-up side, amid the Lunar New Year holidays and an absence of new projects launched, they sold 455 private homes in February, up 4.4 per cent from 436 units they moved a month ago, and 18.5 per cent higher than the 384 units sold a year ago.

While most analysts concur that February sales were healthy amid current difficult conditions post the July 6 cooling measures, it is still a long way from the market consensus of about 9,000-10,000 new sales expected to be achieved this year.

Mr Ong Teck Hui, senior director of research & consultancy at JLL, said developers are trying to launch their projects earlier to secure sales before competition intensifies with the multitude of new launches expected to hit the market this year, and also in light of nearly 36,000 uncompleted and unsold units as of the fourth quarter last year.

Market sentiment could also soften due to the uncertain external environment and slower economic growth, he added.

Already, new launches have resumed in March with several projects including the 1,410-unit The Florence Residences in Kovan, and the 2,203-unit Treasure at Tampines launched on Friday (March 15), Singapore’s biggest private residential project to date.

“Home buyers will likely remain price-sensitive, preferring projects that are well-located, … and competitively priced,” OrangeTee & Tie head of research and consultancy Christine Sun said.

Affinity at Serangoon launched the most units last month, with 250 released. Riverfront Residences put 70 on the market while The Tapestry had 100, Artra put up 81 and The Tre Ver launched 50 units.

News of the upcoming first phase of the Cross Island Line proved a bonanza for condo projects including Affinity at Serangoon, Riverfront Residences and The Garden Residences, which are located near proposed MRT stations, analysts say.

Affinity at Serangoon and Riverfront Residences accounted for more than half of February’s launched units, and contributed to 30 per cent of total units sold.

“MRT infrastructure announcements tend to move condo sales. … Projects in Serangoon – The Garden Residences, Affinity and Riverfront – accounted for one-third of total sales in February,” Huttons Asia’s research head Lee Sze Teck noted.

Many developers have also increased commissions to incentivize agents amid growing competition for buyers, Ms Sun added.

International Property Advisor chief executive Ku Swee Yong warned that “higher interest rates and an increase in bank foreclosure sales are clear indications that home buyers should err on the side of prudence.”

Mortgagee listings, which refer to properties repossessed by banks, jumped to 472 last year, up 27 per cent from 2017 – the highest annual level since the start of Colliers International’s database in 2008. Total auction listings jumped 35 per cent to 1,088 last year from 2017 – driven mainly by residential and industrial listings, and a record number of properties being put up for mortgagee sales by banks.

Ms. Tricia Song, head of research for Singapore, Colliers International, said: “The number of mortgagee listings has risen gradually in the last five years, possibly stemming from the bull run in the market in 2011, 2012 and 2013 where some buyers might have snapped up units at elevated prices, and subsequently found themselves unable to service the mortgage payments.

“This year, we expect property auction listings – both owners’ and mortgagee listings – and sales to grow as cooling measures continue to bite in the residential segment and more owners putting up non-residential properties for sale,” she said.

“Source: [Developers trying to launch earlier to beat competition from coming mega projects] © Singapore Press Holdings Limited. Permission required for reproduction”

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