Kingsford Waterbay and Sims Urban Oasis helped boost developers’ monthly home sales for March 2015. Developers moved a total 613 private homes last month, up 57 per cent from the 390 units in the previous month.
The latest showing, based on Urban Redevelopment Authority data released on Wednesday, also marks a 28 per cent improvement year on year. It was also the best sales result since last October.
Industry players said April’s numbers should also be good, on the back of brisk sales so far at North Park Residences in Yishun and Botanique at Bartley. Frasers Centrepoint has sold 413 of the 600 units it has released at the 920-unit North Park Residences, while UOL Group has moved more than 200 units at the 797-unit Botanique at Bartley in Upper Paya Lebar Road.
“There’s a definite pick-up in (sales) momentum but whether it can be sustained depends on how attractive the new launches are and their pricing level,” said JLL national director Ong Teck Hui.
Ong Choon Fah, chief operating officer at DTZ SE Asia and soon to be its CEO, highlighted that the pick-up in residential property sales is also being felt in the secondary market. “Some owners are feeling the pain from the rise in interest rates. And leasing is also more challenging due to the increase in new home completions. So they are more motivated to sell because they don’t see the market turning around in the short term.”
URA’s numbers released on Wednesday show that Kingsford Waterbay in Upper Serangoon View – the sole new launch in March – recorded sales of 155 units last month at a median price of S$1,111 per square foot.
GuocoLand, which released Sims Urban Oasis in February, found buyers for another 107 units last month at a S$1,401 psf median price.
SLP International executive director Nicholas Mak observed that these two projects accounted for 43 per cent of last month’s primary market private home sales (excluding executive condos). While this may be viewed as a lop-sided performance and not reflecting a general recovery in residential sales, OrangeTee’s manager, research and consultancy, Xian Yang Wong, highlighted that, for the first time since October last year, the top 15 best-selling projects all managed to achieve double-digit sales figures in March.
URA’s data also showed that developers last month sold 79 units in existing executive condo (EC) projects, up slightly from 65 units in February. ECs are a public-private housing hybrid and over the next few months, these projects are expected to take centre-stage for new launches.
Word on the street is that e-applications could begin around mid-May for Westwood Residences in the Jurong West vicinity. The 480-unit project is being developed by Koh Brothers and Heeton Homes.
Several other EC project launches are also expected to be put on the market this year – including City Developments and TID’s development along Canberra Drive in the Sembawang area, MCL Land’s 1,327-unit Sol Acres along Choa Chu Kang Grove and SingHaiyi and Kay Lim’s project in Anchorvale Crescent.
Based on the latest URA numbers, developers have sold 1,379 private homes (excluding ECs) in the first quarter. The final figure will be released later this month. “This is rather similar to the 1,376 private residential units sold by developers in Q4 2014 – indicating a stabilisation of new home sales volumes over two quarters,” said JLL’s Mr Ong.
Should the quarterly average be annualised, reasoned CBRE Research’s Singapore and SE Asia head, Desmond Sim, sales will number about 5,000-6,000 units a year.
PropNex CEO Ismail Gafoor estimates that developers are likely to sell around 9,000 private homes in 2015. “Conservatively, we estimate that about 1,800 EC units will be sold this year, with a good chance it may hit 2,000 units. “We are being conservative because starting with Westwood Residences, HDB upgraders who buy in new EC projects will have to pay a resale levy on the disposal of their HDB flats,” said Mr Ismail.
DTZ’s Mrs Ong noted that developers still see fairly good demand for residential projects in choice locations such as near MRT stations.
Buyers, however, remain price sensitive – with their budgets crimped by the total debt servicing ratio, the additional buyer’s stamp duty and now, more recently the rise in Sibor.
“Developers do try to price their projects attractively – to clear as much of their stock as possible to ease cashflow and in view of the impending competition from rivals who secured land at lower cost in recent months,” she said.
Source: “Developers’ March private home sales highest in five months”, The Business Times, Apr 16, 2015