The best performing private project in June was the 455-unit, 99-year leasehold Riviere at Jiak Kim Street with 25 units sold at a median price of $2,856 psf (Photo: Samuel Isaac Chua/EdgeProp Singapore)
SINGAPORE (EDGEPROP) - With no new project launches during the June school holidays, developers’ private new home sales (excluding executive condos) plummeted 64% m-o-m to 488 units, from 1,355 units in May. “This is the lowest monthly sales since May 2020, when 487 units were sold during the Circuit Breaker period when project showrooms were closed,” says Tricia Song, CBRE head of research, Southeast Asia.
This latest month’s sales bring the preliminary developers’ sales in 2Q2022 to 2,504 units. Including the 1,825 new homes sold in 1Q2022, this brings the new home sales tally for 1H2022 to 4,329 units, estimates Song.
Developers released just 397 new units for sale in June, compared to 1,240 units launched in May.
Source: CBRE Research, URA
The best-performing private project in June was the 455-unit, 99-year leasehold Riviere at Jiak Kim Street fronting the Singapore River, with 25 units sold at a median price of $2,856 psf. Riviere is a city fringe or Rest of Central Region (RCR) project, as is the second best-selling project in June, the 1,862-unit, 99-year leasehold Normanton Park. With 21 units sold at a median price of $1,864 psf, the project is 100% sold, just 18 months since it was launched in January 2021.
Read more: With final unit sold, all 1,862 units at Normanton Park fully taken up in 18 months
Just 111 new homes were sold in June in the Outside Central Region (OCR) amid depleting unsold inventory, with sales down 55% m-o-m, says Wong Siew Ying, PropNex head of research and content. The top sellers in the OCR in June were the 1,410-unit The Florence Residences, with 20 units sold at a median price of $1,746 psf; and the 448-unit The Watergardens at Canberra where 16 units were transacted at a median price of $1,463 psf.
Eight units were sold in the executive condo (EC) segment in June, a 60% drop from 20 transactions in May. The best-selling EC project in May was the 616-unit North Gaia, where five units were sold at a median price of $1,303 psf.
The top-performing project in the Core Central Region (CCR) in June was the 188-unit Haus on Handy in the Dhoby Ghaut neighbourhood, with 21 units sold at a median price of $2,654 psf. This was followed by Leedon Green, where 20 units were sold at a median price of $2,843 psf. The 638-unit, freehold project is located in the neighbourhood of Farrer Road and Leedon Heights. In third place is the 540-unit Irwell Hill Residences, near Great World City, A total of 19 units were sold at a median price of $2,876 psf.
June’s developer sales were skewed towards the CCR, points out CBRE’s Song, with 206 units (42.2%) sold, followed by the RCR where 171 units (35%) were sold and OCR, which accounted for 22.7%. This compares to 65.9% in the RCR, 18.2% in the OCR and 15.9% in the CCR in May 2022.
“The depleting unsold inventory further limits the available choices, leading to lower sales,” says Lee Sze Teck, Huttons Asia, senior director of research. “Buyers were apparently unfazed by the increase in interest rates as they bought pricier homes. This is because loan drawdowns for new homes are on a progressive payment basis, or they would have used more cash for their purchase,” he adds.
For example, a person buying a $2 million property with a $1.5 million loan over 30 years at 1.7% interest rate will utilise 5% of the loan when the foundation is completed around nine to 12 months later. The loan repayment works out to an estimated $355 per month. If interest rate goes up to 3% 12 months later, the loan repayment increases by an estimated $67 to $422 per month.
Source: URA, Huttons Research as of 12 July 2022
“The proportion of purchases by foreigners shot up to 11.7% despite a quiet June,” according to Huttons’ Lee. “This is the highest proportion since Oct 2017. Interest from foreigners remained healthy as they favour Singapore’s stability amidst the uncertainties.” This was an increase from 6% the previous month. Based on URA Realis caveat data, foreigners purchased new private homes mainly in the CCR and RCR.
Source: URA, Huttons Research as of 12 July 2022
Singaporeans accounted for nearly 76% of new home sales in June, and “we expect this number to rise in the coming months, as more mass-market projects are launched,” says PropNex’s Wong.
“With the launch of AMO Residence on 23 July, we anticipate that new home sales this month [July 2022] should outperform that of June,” adds Wong. “In addition, some buyers may want to get transactions done before the Hungry Ghost month starts at the end of July.”
Catherine He, Colliers director and head of research, Singapore, expects new home sales to moderate to 9,000 units for 2022, from the 13,027 units in 2021. Price growth this year is expected to halve to 4-5% this year, down from 10.6% growth in 2021.
Check out the latest listings near Riviere, Normanton Park, The Florence Residences, The Watergardens at Canberra, North Gaia, Haus on Handy, Leedon Green, Irwell Hill Residences