Residential property outlook for 2019

With 2018 drawing to a close, Cushman & Wakefield’s Christine Li gives a snapshot of how next year could pan out. The private housing market may not be as gloomy as widely perceived.

During the weekend of Nov 3 and 4, MCL Land’s preview of Parc Esta in Eunos drew more than 5,000 visitors. That weekend, two projects were launched and registered relatively healthy sales. Roxy Pacific Holdings sold 45 out of a total of 98 units at the freehold Arena Residences on Guillemard Lane. The average price of units sold was $1,750 to $1,850 psf. City Developments (CDL) sold 160 of the 240 units released at the 721-unit Whistler Grand on West Coast Vale, with units priced at an average of $1,380 psf.
The preview of Parc Esta drew more than 5,000 visitor on the first weekend (Photo Credit: MCL Land)
“Demand is now driven largely by new launches — compared with a year ago, when resales were buoyant, owing partly to en bloc sales,” says Christine Li, senior director and head of research at Cushman & Wakefield (C&W). She was the keynote speaker for “Property Investment Outlook 2019” at the EdgeProp 360 event held on Nov 1 at the Marina One auditorium. According to C&W Research, in 3Q2017, resales accounted for 59% of transactions, with new-home sales making up just 40%. In 3Q2018, the tables have turned, with new-home sales accounting for 52% of total private housing transactions, and resales, 46%.

Dip in transaction volume, prices

The ninth round of property cooling measures introduced on July 6 may have felt like a deathblow, coming just 18 months after the revival in the residential market. The effect, however, is not as significant as it was when the total debt servicing ratio loan (TDSR) framework was implemented at end-June 2013, says Li. Post-TDSR, the volume of residential sales plunged 42%. After the July 6 measures, transaction volume fell 20%, she adds.
Li: It's counter-intuitive. Most people would think that more supply will depress prices but, on the contrary, new supply is pushing up prices (Photo Credit: Albert Chua/EdgeProp Singapore)