Buyers encouraged by the current low interest rate environment

SINGAPORE – Sales of new private homes rose by 8.8 per cent last month from August even while developers continued to hold back new projects after the Hungry Ghost Festival that is considered by some as inauspicious for major transactions.

Developers sold 509 private homes last month, up from 468 units in August, Urban Redevelopment Authority (URA) figures showed on Monday. No new projects were launched in September, but developers launched 479 units from their existing projects for sale – an 18.8 per cent re-duction from the previous month’s 590 units, URA data showed. Recent executive condo launches include Treasure Crest and Northwave EC while existing ones include Terrace EC, Brownstone EC, The Vales EC, Parc Life EC , Sol Acres EC, The Visionaire, Bellewoods EC, Signature at Yishun, The Criterion EC, Waterwoods EC, Skypark Residences, Wandervale EC, The Amore EC,  Bellewaters EC.

“Our analysis… suggests that developer sales are performing fairly well despite a drop in the launch volume. This could be because some buyers are getting used to the property cooling measures and might accept these as the additional costs for buying private residential properties,” said Mr Nicholas Mak, research and consultancy head at SLP International Property Consultants.

“Hence, the demand for private housing is reaching the stage of stabilisation after reeling from the regulatory shock experienced in 2013 to 2015,” he added.

The suburbs, or outside central region (OCR), led last month’s sales with 297 units, followed by the city fringes, or rest of central region (RCR), with 144 units. The city centre, or core central region (CCR), registered 68 sales. Lake Grande condominium in the Jurong Lake District was the top seller of the month, with its developer MCL Land offloading 29 units at a median price of S$1,312 per square foot. The Trilinq, situated in Clementi, came in second with developer IOI Properties selling 28 units at a median S$1,405 psf.

With less than three months to go before the year ends, sales of new private homes have reached 5,744 units, noted Mr Desmond Sim, head of CBRE Research in Singapore and South-east Asia. The recent success of new developments such as The Alps Residences in Tampines and Forest Woods in Serangoon, if sustained, can help 2016’s total sales to match and even surpass those of the previous two years. The total sales figures for 2015 and 2014 were 7,440 units and 7,316, respectively, said Mr Sim.

“It gives the market stronger certainty that measures will not be tweaked in the near term and this certainty is likely to swing buyers sitting on the fence to make the purchase. Buyers have also been encouraged by the current low interest rate environment, although it could change by year-end, should the Fed revise rates upwards. The expectation that rates will likely increase should nudge more buyers to action,” Mr Sim said.

“The strong sales so far have certainly reduced unsold inventory and encouraged developers to re-launch existing projects,” he added.

In the executive condomium (EC) segment, developer sales fell 21.5 per cent to 260 units last month from August’s 331 units. The top selling EC development was Treasure Crest at Anchorvale Crescent, where 38 homes were sold at a median of S$746 psf.

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