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Private home sales fall 21% as fewer projects launched

Private home sales fall 21% as fewer projects launched
Analysts attributed the month-on-month decline in sales to the lack of new launches during the traditionally slow school holiday period. TODAY file photo

Private home sales fall 21% as fewer projects launched

SINGAPORE — Property developers sold 820 private homes, excluding executive condominium (EC) units, last month, down 21 per cent from 1,039 units sold in May, but higher than the 536 units sold in June last year, according to data released by Urban Redevelopment Authority (URA) yesterday.

Including ECs, 1,064 units were sold last month compared with 1,416 in May, up from 768 private homes in June last year.

Analysts attributed the month-on-month decline in sales to the lack of new launches during the traditionally slow school holiday period.

Market sentiment has picked up considerably this year, despite the Government’s indication that property cooling measures are unlikely to be lifted any time soon.

In the first six months of this year, developers sold 6,388 private homes, almost double compared with the 3,675 units sold in the same period last year.

In the second quarter of this year, a total of 3,426 units were sold, far exceeding the 2,256 units sold in the second quarter last year and the 2,962 units in the first quarter of this year.

“It seems that the performance of the recent Government land tenders may have affected buyer sentiments. As such, buyers seem to be motivated by concerns about catching the wrong side of the market, which is a possible upward trend. Notwithstanding, there are also pressures felt with a rising interest rate environment,” said Mr Desmond Sim, head, CBRE Research, Singapore and South-east Asia.

“With just one new launch in June — Park 1 Suites in Lorong 40 Geylang — previously launched developments seem to continue to enjoy some sales traction, as buyers continue to seek value in a market that has shown more signs of bottoming out. The uplift in sales at these projects came despite no discernible price adjustments,” Mr Sim added.

Sales in the first half of this year have shown significant recovery compared with the 2,907 units transacted in the second half of 2014, although the level is still some way below the 9,950 units sold in the first half of 2013 before the Total Debt Servicing Ratio took effect, said Mr Ong Teck Hui, national director of research and consultancy at JLL.

“This points towards a market that has regained confidence and recovered substantially in transaction volume. A pick-up in activity in July is expected with the resumption of new launches, including Martin Modern and Le Quest,” added Mr Ong.

The top-selling private residential projects last month were The Santorini (75 units), Parc Riviera (55 units), Commonwealth Towers (47 units) and Sophia Hills (44 units), transacting at a range of between S$1,026 and S$1,978 per square foot.

ERA Realty Network key executive officer Eugene Lim also expects an uptick in developer sales this month and the next, buoyed by upcoming project launches.

“Buyer interest has clearly grown since last year. Most of them are of the opinion that the private residential market is bottoming out and they are buying with longer-term prospects in mind. Also, with recent land prices trending upwards, many buyers might commit to a purchase now rather than later,” said Mr Lim.