July’s 8.2% increase in number of units sold comes even as economic outlook worsens
New home sales continued to rise for a third straight month amid a worsening economic outlook, with developers selling 1,080 non-landed private homes last month, up 8.2 per cent from June.
This is up from a near six-year low during the circuit breaker period in April, but sales were down 8.4 per cent from 1,179 a year ago.
There were 869 private homes launched in July, up nearly 46 per cent from 597 in June, but down 4.6 per cent from 911 a year ago.
The bulk of the units sold were from earlier launches, which accounted for 68 per cent of July’s total sales, analysts say.
The figures, released by the Urban Redevelopment Authority (URA) yesterday, excluded executive condominium (EC) units, a public-private housing hybrid. Including EC units, 1,142 new non-landed homes were taken up last month, up nearly 11 per cent from June, but down about 27 per cent from 1,557 a year ago, the URA data showed.
Ms Wong Siew Ying, head of research at PropNex, noted that while the relatively brisk sales in recent months may seem at odds with the gloomy economic prognosis, the current downturn is not felt evenly across all sectors of the economy.
“Some sectors – such as financial services and tech – have held up better than others, and (those who) feel more secure about their job prospects or have built up substantial savings may see this as an opportune time to enter the market.”
However, the absence of new launches last month shows caution among some developers. Although showflats reopened on June 19, they did not rush to launch new projects before the start of the Hungry Ghost month tomorrow, a period that typically sees a quieter market.
“Developers need more time to recalibrate their pricing strategies as well as to (implement) safe management measures, especially for larger-scale projects,” said Mr Ong Teck Hui, senior director of research and consultancy at JLL.
Potentially affecting new launches and sales take-up for the rest of the year are factors like the severity of the recession and whether the pandemic remains under control, he added. Upcoming launches include Penrose in Sims Drive and The Landmark in Chin Swee Road.
Last month’s take-up was led by projects in the suburban sub-market (outside central region) with 548 sales, followed by 419 units sold in the city fringes or rest of central region, and 113 in the prime districts or core central region.
So far this month, freehold Forett at Bukit Timah is the only new launch, selling 172 units at a median price of $1,931 psf, JLL said.
Ms Tricia Song, head of research for Singapore at Colliers International, noted that foreign buying slowed last month, with only 34 or 3.2 per cent of new sales caveats lodged by foreigners, compared with 47 or 4.9 per cent in June.
Disputing talk of discounts, Mr Wong Xian Yang, Cushman & Wakefield’s associate director of research for Singapore and South-east Asia, said median prices of the top five selling projects in July were similar to or even higher compared with those from the time of their launch to July.
For instance, the median price for The Florence Residences from the time of its launch to July was $1,471 per sq ft (psf), but it rose to $1,559 psf in July, he pointed out.
Interest in pricier units has picked up, analysts say. This is despite Singapore suffering a deeper recession in the second quarter than expected, with the economy contracting 13.2 per cent year on year, sharper than a 12.6 per cent plunge earlier estimated and the worst on record, the Ministry of Trade and Industry said last week.
URA Realis data showed 147 deals transacted at more than $2 million each in July compared with 118 such deals in June, said CBRE’s head of research for South-east Asia Desmond Sim. “There were also some large quantum deals of more than $5 million in luxury projects such as 15 Holland Hill last month.”
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