Coronavirus pandemic

Circuit breaker measures to take toll on new home sales

Volume falls in March and set to stay low with show-flats shut, launches pushed back

Developers in Singapore sold 660 private homes last month - the worst showing in five years - down 32 per cent from 976 in February, as the property market grappled with increasingly stringent safe distancing measures. Year on year, the number of new
Developers in Singapore sold 660 private homes last month - the worst showing in five years - down 32 per cent from 976 in February, as the property market grappled with increasingly stringent safe distancing measures. Year on year, the number of new private homes sold last month was down 37 per cent from 1,054 units in March last year.ST PHOTO: KELVIN CHNG

Private home sales slipped last month and are poised to stay low this month as show-flats close and more launches are expected to be pushed back on account of the circuit breaker measures.

Developers in Singapore sold 660 private homes last month - the worst showing for the month of March in five years - down 32 per cent from 976 in February, as the property market grappled with increasingly stringent safe distancing measures.

"This year's March, April and May, the traditional peak sales period, would undoubtedly be dry. April's numbers would plunge possibly the most due to the forced shutdown of developers' show-flats and work-from-home orders," said Mr Karamjit Singh, chief executive of Showsuite Consultancy.

Mr Wong Xian Yang, Cushman & Wakefield's associate director of research, Singapore and South-east Asia, said the timing is "especially unfortunate as March to May tend to be bumper months for developer sales. From 2015 to 2019, developer sales during March to May usually made up 26 per cent to 38 per cent of total sales in those years".

Last month, a total of 578 new private residential units were up for sale, of which 101 were in the prime district or core central region, 163 in the city fringe or rest of central region, and 314 in the suburbs or outside central region. In comparison, 933 units were launched for sale in February, and 1,812 units were released in March last year.

Year on year, the number of new private homes sold last month was down 37 per cent from 1,054 units in March last year. The figures, released by the Urban Redevelopment Authority yesterday, exclude executive condominium (EC) units, which are a public-private housing hybrid.

Excluding Ola EC, which sold 170 units at a median price of $1,139 psf, the four new private home launches did not do well.

The 378-unit Kopar At Newton sold one unit at $2,385 psf last month, but reportedly sold 77 units this month. The other prime district launch - 19 Nassim - sold one unit, while 77 @ East Coast and Tedge, both in the suburbs, sold three and eight units respectively.

Existing projects like JadeScape moved 76 units at a median price of $1,719 psf, Treasure at Tampines sold 69 units at a median price of $1,355 psf, and Parc Esta transacted 63 units at a median price of $1,657 psf.

Including ECs, developers moved 904 units last month, down 31 per cent from February's 1,315 units, and nearly 15 per cent lower than the 1,062 units sold in March last year.

Ms Tricia Song, head of research for Singapore, Colliers International, noted that including ECs, new launches made up only 20 per cent of developers' sales last month, compared with 55 per cent in February. Excluding ECs, this figure was even lower, at 2 per cent last month versus 40 per cent in February, she said.

While virtual show-flats saw interest, actual sales have not materialised as buyers prefer to get a sense of the actual size, layout and finishes.

Documenting property purchases and payments during the circuit breaker period has also proved challenging, Ms Song said.

JLL's senior director of research and consultancy Ong Teck Hui said: "New private home sales in March marked a significant shift in the primary market. In January and February, new private home sales totalled 1,596 units, which was 80 per cent higher than the same period last year, reflecting an upward market momentum. However, primary market sales in March dropped 37 per cent from that in March 2019."

New sales launches could be scaled back due to uncertainty over whether the circuit breaker may be extended, which would reduce transaction volumes this year, he added.

A version of this article appeared in the print edition of The Straits Times on April 16, 2020, with the headline 'Circuit breaker measures to take toll on new home sales'. Subscribe