More than 9,000 new home sales expected in 2019: OrangeTee

By EdgeProp | February 28, 2019 12:22 PM SGT
Towns more likely to see more resale transactions in 2019 (Credit: OrangeTee & Tie)
New home sales could pick up this year as more than 60 projects are expected to be launched in the coming months. According to OrangeTee & Tie in its Market Outlook 2019 report released on Jan 25, an increase in marketing activities and number of new project launches has historically spurred buying interest.
While more than 19,000 new units may be launch-ready this year, the actual number of units launched could be between 12,000 and 14,000 units.
New home launches and impending supply are projected to dip from mid-2020 in tandem with the slowdown in collective sales in 2H2018 that resulted from the property cooling measures introduced in July 2018. Developers are more likely to spread their new stock over the next two years as new home supply is expected to fall drastically from mid-2020.
Of the 12,000 to 14,000 new units slated for launch this year, OrangeTee reckons the take-up rate is likely to be between 9,000 and 10,000 units.
Given the pipeline of new supply and ongoing US-China trade tensions weighing on market sentiment, OrangeTee predicts that overall housing prices will grow by 1% to 3% for 2019. Price growth for new homes (excluding executive condos or ECs) is expected to be higher – in the range of 1% to 4% – given the relatively high land prices paid by developers over the past two years. Meanwhile, resale home prices are expected to remain flat or rise marginally in tandem with new sales, by 1% to 2%.
According to URA, the expected completions (excluding ECs) dipped from 10,119 units in 3Q2018 to 8,926 units in 4Q2018, indicating that some projects were completed earlier than expected.
As the number of new completions are expected to dip by 2% this year, and likely to hit a fresh low next year, rents are expected to “remain robust” at the current level – trending between minus 1% and 1% for 2019. Leasing demand is expected to strengthen further this year after reaching a 10-year high, with 88,400 rental...