Moderate new home sales as holidays begin

An artist's impression of Parc Botannia in Sengkang, which launched 357 units last month and managed to sell about 70 per cent of them at a median price of $1,287 per sq ft.
An artist's impression of Parc Botannia in Sengkang, which launched 357 units last month and managed to sell about 70 per cent of them at a median price of $1,287 per sq ft.PHOTO: SING HOLDINGS, WEE HUR HOLDINGS

Sales of new homes rise just 3.3% last month, during a typically quiet season

The usual festive season lull seems to be enveloping the property market again with muted sales last month.

Transactions of new private homes inched up just 3.3 per cent to 785 units compared with the 760 moved in October.

It was an 8.7 per cent drop on November last year, according to Urban Redevelopment Authority data yesterday. The numbers exclude executive condominium (EC) units.

Mr Ong Teck Hui, national director of research and consultancy at JLL, said: "With the onset of the year-end holiday period and the market moving in favour of sellers, there is no hurry for developers to continue launching more units from their projects."

He noted that of the 450 private homes launched last month, only 47 were new releases from previously launched projects. That is a 76.7 per cent plunge from October and the lowest monthly figure in the year. "This has reduced buying options, contributing to moderate sales figures," he added.

Indeed, although the 450 private homes launched is 86 per cent more than in October, it is still 67 per cent down on November last year.

From January to last month, about 11,127 new private homes have been sold, 39 per cent more than the same period last year.

There were three new condos launched last month. Rezi 35 in Geylang found buyers for 12 of the 44 units released at a median price of $1,595 per sq ft (psf).

The 735-unit Parc Botannia launched 357 homes, with 253 taken up at a median price of $1,287 psf. This was by far the best-selling project last month. Link Residence @ Holland, a landed development, placed two of its four units on the market but did not sell either.

Mr Ong said it is "interesting" how developers' pricing and sales strategies have changed from a softening to a recovering market. For one thing, developers are taking their time to release new units, while daring to command higher prices.

Case in point: Parc Botannia in Sengkang, which launched only half its units and managed to sell 70 per cent at a median price of $1,287 psf.

Compare this with nearby High Park Residences, which launched 80 per cent of its 1,399 units two years ago and sold nearly all at a median price of $989 psf in the month of launch.

ZACD Group executive director Nicholas Mak noted that in the 12-month period from December last year to November this year, with the exception of April, developers have been selling more units than the number they release for sale each month. This shows not just robust home-buying demand, but also a hold-back among developers, who appear to be waiting for a further price recovery next year.

Meanwhile, new EC sales softened last month, falling 30 per cent from October to 148 units.

Mr Ong noted that this is the lowest monthly new EC sales tally since February last year. From January to November, 4,012 new EC units have been sold, 4 per cent more than in the same period last year.

However, only 1,555 new EC units were launched in the first 11 months this year, a 41 per cent drop from the same period last year.

While demand for ECs remains firm, purchasing opportunities are limited in the absence of new project launches, Mr Ong said.

A version of this article appeared in the print edition of The Straits Times on December 16, 2017, with the headline 'Moderate new home sales as holidays begin'. Print Edition | Subscribe