New private home sales hold steady in January

The latest round of cooling measures and the absence of new mega launches chilled the red-hot private property market last month, even as sales held steady from December.

Buyers took up 673 private residential units, up 3.5 per cent from 650 in December but down 58.8 per cent from 1,633 a year ago, according to Urban Redevelopment Authority (URA) data yesterday.

JLL senior director of research and consultancy Ong Teck Hui noted that although the private market's slowdown is less apparent in new home sales data, URA Realis data shows a 43.2 per cent drop in resale transactions last month from December last year.

"The cooling measures have led to a stand-off between buyers and sellers due to a mismatch in price expectations, which dampened (resale) transaction volume," he said.

Meanwhile, unsold new supply plunged to a new low of 14,333 units as at the fourth quarter of last year, a fraction of its peak of 37,799 units in the first quarter of 2019.

Mr Ong cited a significant improvement in the aggregate take-up rate of projects with 300 or more units to 82.1 per cent last month, from 64.7 per cent in January last year.

The declining inventory will "provide support for home prices as the slowdown in demand is likely temporary", he said.

Developers rolled out a mere 178 new homes last month, the lowest for January since 2017. Launches were down 53.5 per cent from 383 in December, and a whopping 93 per cent from 2,600 a year earlier.

The sharp year-on-year drop was due to the absence of mega launches like that of the 1,862-unit Normanton Park, the 700-unit Parc Central Residences and the 429-unit The Reef at King's Dock in January last year.

There were only two launches last month: the 107-unit Belgravia Ace and 16-unit Ikigai.

Huttons Asia senior director (research) Lee Sze Teck said that strata-landed Belgravia Ace sold 77 units at an average price of $4.4 million.

"Most of the buyers were first-timers who are unaffected by the cooling measures. The ability to cough up more than a million for the down payment and stamp duties meant that either there was inter-generational wealth transfer, or the buyers had ample liquidity," he said.

Ms Wong Siew Ying, head of research and content at PropNex Realty, said January's sales were steady despite fewer new launches in the lull leading up to Chinese New Year and the fresh property curbs.

"Other positive takeaways include the fairly decent sales in the city fringe and suburbs, as well as the good take-up at Belgravia Ace," she added.

The city fringe area continued to see the bulk of demand, accounting for nearly 43 per cent of total sales as Normanton Park was the top condo seller last month, with 94 units sold at a median price of $1,841 per sq ft (psf).

This was followed by the suburbs at 40.9 per cent, with Belgravia Ace accounting for more than a quarter of the region's sales, with the 77 units sold transacted at a median price of $1,080 psf, PropNex said.

Ms Wong said that sales in the prime district fell 18.7 per cent from December to just 109 units - the lowest monthly sales for this location since February last year, when 58 units were sold.

This may be an early indication of the impact of new cooling measures crimping foreign buying interest and investment demand, she said.

Including executive condominiums (ECs), new private home sales edged up 0.8 per cent to 725 units last month, from 719 in December, but fell 65.8 per cent from 2,122 in January last year.

There were no new ECs launched last month, but developers sold 52 EC units, down from 69 in December. Provence Residence was the best EC seller last month, with 21 units sold at a median price of $1,229 psf.

ERA Realty head of research and consultancy Nicholas Mak noted that the number of launched and unsold EC units dropped from 736 units in January last year to just 80 units last month.

"With fewer choices of EC units, some buyers would rather wait for new EC project launches before deciding on their home purchase," he said.