Jump in private home sales seen as sign of better market sentiment

An artist's impression of Parc Riviera in West Coast Vale, launched last November and which sold 200 units last month. With positive sentiments, buyers are also drawn to previously launched projects, said an analyst.
An artist's impression of Parc Riviera in West Coast Vale, launched last November and which sold 200 units last month. With positive sentiments, buyers are also drawn to previously launched projects, said an analyst.PHOTO: EL DEVELOPMENT

Demand for new private homes recorded a third straight strong month in February as developers sold 977 units - a hefty jump from the 382 units sold in January.

Even more striking was the fact that last month's sales were more than treble the 303 units sold in February last year.

The strong showing came despite only one new condo project being launched last month. The sales also came before last Friday's surprise announcement of tweaks in property cooling measures, which analysts believe will lift buying sentiment.

In all, 550 units were put on the market last month compared with 108 in January. Chinese New Year fell in late January.

The Clement Canopy in Clementi was the only new project launched for sale last month, though other projects put out more units.

The Clement Canopy launched 250 units and sold 207 at a median price of $1,343 per sq ft - the best-selling project last month. Another condo in the west was second. Parc Riviera, launched in November last year, sold 200 units at a median price of $1,281 psf.

Executive condos (ECs) also did well, selling 329 units, a jump of 78.8 per cent from January. Sol Acres was top among the ECs with 82 units sold at a median price of $782 psf.

Analysts said the data reflected significantly better market sentiment than at this time last year.

"There is a greater sense of confidence among both developers and buyers," said Mr Ong Teck Hui, JLL's national director of research and consultancy, citing the series of major launches this year. He also noted that of the 977 units sold, 770 were from previously launched projects.

"With more positive sentiments, buyers are not just attracted by newly launched projects, but are also drawn to those launched previously, reflecting a more broad-based improvement in demand," he added.

"The recent easing of the seller's stamp duty (SSD) and the total debt servicing ratio would be a favourable enhancement on a market that is already on a buying uptrend."

Dr Lee Nai Jia, Edmund Tie & Company's head of South-east Asia research, anticipates continuing sales momentum, with the easing of SSD as well as upcoming projects such as Seaside Residences.

However, Mr Desmond Sim, head of CBRE research for Singapore and South-east Asia, said the sales were driven by "the trend of buyers favouring projects with units priced at a palatable quantum". Even with the recent tweaks in property curbs, he added, "taxes surrounding acquisition have not changed and will continue to remain a barrier".

He expects sales this month to be about the same as last month's, even though they will be shored up by the sales of new projects such as Grandeur Park Residences and Park Place Residences, as the sales figures of project launches at the end of the month may not be included.

A version of this article appeared in the print edition of The Straits Times on March 16, 2017, with the headline 'Jump in private home sales seen as sign of better market sentiment'. Print Edition | Subscribe