Rush to beat new property cooling measures fuels July private home sales

The crowd at the Riverfront Residences showflat in Hougang, on July 5, 2018. Riverfront Residences was among the top sellers for the month of July.
The crowd at the Riverfront Residences showflat in Hougang, on July 5, 2018. Riverfront Residences was among the top sellers for the month of July. PHOTO: ST FILE

SINGAPORE - The rush to beat new cooling measures led to a sharp jump in private home sales last month, resulting in the most number of units sold in 16 months.

The spike coincided with a record number of units launched by developers, the most put up for sale in five years.

The 1,724 private homes sold last month was 2.6 times the 654 units moved in June. This was up 55 per cent from the 1,112 units sold in July last year.

Last month's figure was also the highest since March last year, when 1,780 units were sold.

The whopping 2,239 new units released last month were the most since March 2013, when 3,489 new private homes were placed on the market.

The Urban Redevelopment Authority (URA) released the figures on Wednesday (Aug 15), which excluded executive condominium (EC) units. A total of 52 EC units were sold last month, bringing the total inventory of unsold units to a record low of 21.

Among the top sellers last month were Park Colonial near Woodleigh MRT station, Riverfront Residences in Hougang and Stirling Residences in Queenstown - all of which were released on the night of July 5, hours after the Government announced the latest round of property cooling measures.

Based on URA's data for last month, 429 units were sold at Park Colonial at a median price of $1,756 per square foot (psf). At Stirling Residences, 339 units were transacted at $1,746 psf, and Riverfront Residences, the top-selling project, saw 628 units sold at $1,307 psf.

The three projects accounted for 1,396 units, or just over 80 per cent of new private home sales.

 

Analysts noted that the bulk of the deals were inked on July 5 - the day before tighter loan limits and higher Additional Buyer's Stamp Duty were implemented - with URA data showing 997 caveats lodged that day.

Mr Ong Teck Hui, national director of research and consultancy at JLL, described last month's sales volume as a "one-off aberration", saying that he expected more moderate sales figures for the rest of the year, given the cautious mood of both buyers and sellers in the light of the cooling measures.

But OrangeTee & Tie head of research and consultancy Christine Sun noted that the almost 40 per cent of new sales lodged after the measures kicked in was still relatively healthy. Such sales, she said, were likely to be driven by first-time buyers less affected by the cooling measures and those who found launch prices attractive.

She also said that buyers now appear to gravitate towards bigger units, a sign that those left in the market are more likely to be owner-occupiers than investors.

Overall, however, observers expect new home sales to slow significantly as prospective buyers adopt a wait-and-see approach.

Ms Tricia Song, Colliers International's head of research for Singapore, said transaction volumes for this month and next month could be particularly sluggish due to the Hungry Ghost Festival.