SINGAPORE - Sales of new private homes have seen a resurgence this year, the latest being an executive condominium (EC) project in Hougang that sold out within a day - a feat not seen since 2014.
Hundred Palms Residences EC in Yio Chu Kang Road shifted all its 531 units at an average of S$836 per square foot (psf) within seven hours of their launch on Saturday (July 22). The last time a new project sold out in a day was in January 2014 with The Hillford in the Bukit Timah area, a mixed development which was marketed as a "retirement resort".
Another project, Martin Modern, a luxury condo in Martin Place, sold 90 out of 450 apartments over the weekend at the price range of S$2,009 psf to more than S$2,500 psf.
Rising optimism in the market, arising from the recent tweak in certain cooling measures, a healthy stock market and still-low interest rates, has helped to spur developers' sales.
Despite the increase in sales volume, analysts say it is premature to declare that the property market has turned around as the recovery is not broad-based.
"The good performances of recent launches indicates that there is pent-up demand for Singapore properties... (But) prices have stubbornly continued to decline. So it might be too soon to say that the market has finally turned a corner," noted Mr Wong Xian Yang, head of research and consultancy at OrangeTee.
Private home prices fell over the last three years but the pace has been slowing, with a 3.1 per cent drop last year after declines of 3.7 per cent in 2015 and 4 per cent in 2014.
The Government's latest flash estimates show that private home values dipped 0.3 per cent from the first to the second quarter of this year, easing slightly from the 0.4 per cent drop from the fourth to the first quarter.
With prices moderating, sales have climbed.
More than 6,500 new private homes (excluding ECs) were sold in the first half of the year, up a significant 72 per cent from the 3,814 homes sold a year ago.
Mr Wong noted that the robust sales reflect "strong confidence in the long-term growth prospects" of the Singapore property market.
Analysts expect the brisk buying activity to continue but highlighted that site attributes will drive demand and not every project will be a sell-out.
International Property Advisor chief executive Ku Swee Yong said: "New launches are selling well mainly because of marketing hype... If the property market was so hot, why are we not getting lots of viewings for resale homes? Prices in the secondary market are still weak; many owners are selling at losses."
Apart from the relatively weaker resale market, the rental market remains challenging and vacancies are still high.
However, there are other trends that could support the recovery of the property market. These include the fervour in land bidding by developers in both public land tenders and the collective sale market.
Given the bullish prices paid for development sites and more positive sentiment, analysts project that home prices could start to inch up next year, after a 15-quarter losing streak since the fourth quarter of 2013.
Ms Tricia Song, research head at Colliers International Singapore, said: "We expect private home prices to be relatively flat in the second half of 2017 and anticipate a pickup from the beginning of 2018, to maybe approximately +3 per cent for the full year 2018."
The Urban Redevelopment Authority is expected to release the final property price and take-up data tor the second quarter on Friday (July 28).