New home sales rise 13.9% m-o-m in March

By Jennifer Venkat
/ EdgeProp Singapore |
A scale model of the The Botany at Dairy Farm, the best top-selling project for March. (Photo: Samuel Isaac Chua/EdgeProp Singapore)
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SINGAPORE (EDGEPROP) - Developers sold 492 new homes excluding executive condos (ECs) in March 2023, according to URA data released on April 17. The figure is 13.9% higher than the 432 units sold in February but 24.8% lower compared to a year ago, when 654 units were sold.
The 492 new homes sold is 43.8% below the five-year average for March sales (876 units), says Tricia Song, head of research for Southeast Asia, CBRE. “This brings 1Q2023 new home sales to 1,318 units, a 29.9% y-o-y fall from 1,880 units sold over the corresponding period in 2022,” she adds. “Compared to the early part of 2022, take-up has largely moderated, and buying sentiment has turned cautious amid record high interest rates and a slowing economy.”
In March, The Botany at Dairy Farm in the Outside Central Region (OCR) led the way with 184 units sold at launch and a median price of $2,068 psf.
The 386-unit Botany at Dairy Farm accounted for 37.4% of total sales in March, says Lee Sze Teck, senior director of research, Huttons Asia. “It pulled up the proportion of sales in the OCR to 46.7% in March,” he adds. This brings total sales in the OCR to 230 units last month.
The Core Central Region (CCR) — a proxy for high-end homes — was the next most active region, with 197 units (40%) sold. Projects in the CCR dominated the top 10 bestselling projects in March.
URA new home sales table 1 - EDGEPROP SINGAPORE
ura new home sales table 2 - EDGEPROP SINGAPORE
ura new home sales table 3 - EDGEPROP SINGAPORE
ura new home sales table 4 - EDGEPROP SINGAPORE
CCR presents value buys
“The narrowed price gap between private homes in the CCR and the Rest of Central Region (RCR) has rendered CCR properties as attractive buying opportunities,” says Chia Siew Chuin, head of residential research, JLL.
Realis data from January to March showed that the gap in median price quantum for all non-landed homes between the CCR and RCR has narrowed from 44.6% in January to 30.5% in February and 24.4% in March.
The upside in prices of non-landed units in the CCR has been muted due to the cooling measures and demand shift to more affordable market tiers, Chia adds. She sees prices in the RCR increasing faster due to increased demand and new project launches at record prices.
The increased attention on value buys led home buyers to flock to the CCR, says Lam Chern Woon, head of research and consultancy at Edmund Tie. Projects that contributed to the higher new home sales in the CCR included Leedon Green, with 26 units sold in March at a median price of $2,957 psf; Pullman Residences Newton, with 21 units sold at a median price of $3,295 psf; and Hyll on Holland, with 18 units sold for a median price of $2,875 psf.
In the RCR, or city fringe, the top-selling projects were: The Landmark (24 units sold at a median price of $2,626 psf); Riviere (nine units sold at median price of $3,180 psf) and Piccadilly Grand (eight units sold at a median price of $2,008 psf). They accounted for 63% of the market segment’s sales in the month.
Firmer new home prices in March
“Prices of new homes were noticeably firmer in March,” says Lam. Seven of the top 10 projects — namely Leedon Green, The Landmark, Pullman Residences Newton, Hyll On Holland, Klimt Cairnhill, Peak Residence and One Bernam — saw prices rise 2.6% m-o-m on average in March, while prices for two other projects declined 2% m-o-m. As unsold inventory gets pared down, developers are emboldened to raise prices in accordance with sustained market demand, he adds.
“The current buying trend seems to be more supply-led rather than demand-driven, depending largely on what projects are released that month,” comments Christine Sun, senior vice president of research & analytics at OrangeTee & Tie.
Higher marginal buyer stamp duty rates announced in Budget 2023 have moderated prices somewhat, notes Edmund Tie’s Lam. The share of new private homes sold at prices above $1.5 million declined to 72% in March, from 95% in February.
“Developers are likely to swing towards one- and two-bedroom units for new projects to limit the price quantum and psychological impact of higher buyer stamp duties for mainstream buyers,” according to Lam.
For example, the one- and two-bedroom units were almost sold out at The Botany, Huttons’ Lee points out. Investors zoomed in on these units due to the rental demand from the German European International School next door. Smaller households also favoured the two-bedroom units, he notes. Meanwhile, upgraders preferred the three-bedroom.
“Even the median prices of homes sold in the secondary market fell by 3% m-o-m in March, after rising in the first two months of the year,” notes Edmund Tie’s Lam.

The proportion of foreign buyers: Jan 2022 to Mar 2023

Source: Huttons Research

Foreign purchases to rise

Foreign purchases accounted for 38 units (7.8%) of new home sales in March, notes Huttons’ Lee. Foreigners accounted for 73.7% of the units purchased in the CCR in March.
However, the share of foreign purchases for overall sales (new and secondary) in non-landed homes fell for the second straight month in March to 6%, from 7.7% in February and 8.3% in January, according to Edmund Tie.
“This belies the fact that foreign demand has risen steadily from 72 units in December 2022 to 94 units in March 2023,” notes Edmund Tie’s Lam. “While China has rolled back on several Covid-19 restrictions, it may take some time for foreign demand to recover more significantly.”
According to Lam, the location of new project launches would also have a bearing on foreign demand versus local demand. “City-fringe and suburban project launches in recent months are likely to draw more local buyers.”
Don't miss out to check out the hottest new launch condo and new landed property in Singapore
Upcoming launches in April and May include the 275-unit Blossoms By The Park (in the RCR) that was previewed over the weekend of April 14–16, the upcoming 816-unit The Continuum at Thiam Siew Avenue (RCR), the 246-unit Newport Residences (CCR), the 598-unit Lentor Hills Residences (OCR) and the 732-unit The Reserve Residences (OCR), says Eugene Lim, key executive officer of ERA Realty Network.
Edmund Tie’s Lam forecasts 8,000 to 9,000 new home sales for 2023 on the back of the new launches this year. “However, risks are skewed to the downside as momentum in the public resale market slows while financing and borrowing costs remain restrictive,” he says.
While the rental market is under pressure from the ramp-up of completions this year and in 2024, pricing momentum remains positive due to new project launches at higher prices as a result of higher land and construction costs. “Amid mounting economic headwinds, overall private home prices are projected to rise by a sustainable 5–7% in 2023, following 2022’s 8.6% growth,” he says.

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