SINGAPORE - Sales of new private homes picked up strongly in November despite the start of the year-end holiday period and amid a property glut, according to data released by the Urban Redevelopment Authority on Monday (Dec 16)
Excluding executive condominiums (ECs), developers sold 1,147 units last month, 23.2 per cent more than 931 units in October and just 4.5 per cent fewer than the 1,201 units in November 2018, which was the most since the 2018 property cooling measures.
Including ECs, which are a public-private housing hybrid, developers moved 1,168 units in November, a 21.9 per cent increase from 958 units in October and just 3 per cent lower than a year ago.
Last month, developers launched 740 private homes for sale, down 17 per cent from 892 units in October, and a hefty 44.9 per cent less than the corresponding 1,342 units in November last year. There were no ECs launched last month.
November's take-up was led by projects coming up in the suburban areas or outside central region (OCR) which saw 608 units sold. This was followed by 351 units from projects in the city fringes or rest of central region (RCR) and 188 units from those in the prime districts or core central region.
The best-selling project was the 680-unit Sengkang Grand Residences which launched for sale last month. The 99-year leasehold condominium coming up next to Buangkok MRT Station sold 235 units of the 280 units offered at a median price of $1,741 per square foot (psf).
The 296-unit One Holland Village Residences, located in a prime district, sold 87 units of the 126 units launched in late November at a median price of $2,606 psf.
Three previously launched projects did well in November include Parc Esta (102 units), Jadescape (60 units) and Parc Botannia (59 units).
Christine Sun, head of research at OrangeTee & Tie, said developers are riding on positive sales momentum with a final burst of launch activities before the year-end holidays.
Year to date, a total of 9,547 units, excluding ECs, have been sold, out of 10,751 units launched, already exceeding the 8,795 units for the whole of last year. Some market watchers said developer sales could exceed 10,000 units for the whole of 2019.
"Given that the average number of units sold in the month of December for the last six years was about 380 units and taking into account lapsed options or 'returned units', we estimate that between 9,500 and 10,000 units could be sold in 2019," said Ms Sun.
For 2020, with US and China having reached a phase-one trade deal, this could de-escalate trade tensions and boost market confidence, she added.
"We anticipate that the next wave of inbound capital may continue to enter Singapore's property market next year with more Chinese capital flowing south," said Ms Sun,adding that mortgage rates may remain low or go lower next year, which would help housing demand to 'cruise' at current levels.
"As such we estimate that between 9,000 and 9,800 new homes excluding ECs could be transacted in 2020," she said.
Desmond Sim, CBRE's research head for South-east Asia, noted that a total of 51 projects have been launched from January to November, making 2019 the year with the highest number of launches in the last 5 years.
Mr Sim said most new project launches in 2019 have registered a take-up of less than 50 per cent of the total number of units. As such, developers are expected to focus on clearing their existing inventory while remaining prudent in their land bidding strategies, he said.
URA's data for November also show that the accumulated number of new private residential units launched but unsold stands at 4,375. Including ECs, this number rises to 4,748.
The Monetary Authority of Singapore (MAS) in its annual Financial Stability Review last month said the number of unsold homes from launched projects will likely be exacerbated in the medium term as
developers continue to launch projects arising from the large number of en bloc sites in the last collective sale fever of 2017 to last year.
It also warned that the oversupply in the private housing market threatens to push down prices. In total, Singapore has a backlog of 31,948 unsold private housing units from projects with planning approval as of Sept 30, which by past estimates of demand could take nearly four years to clear.