Impetus to procure land becoming more urgent for developers

SINGAPORE — New private home sales surged last month to a near-four-year high as developers put more projects on the market and relaunched others to meet increased demand following the Government’s move to ease some property cooling measures.

Developers sold 1,780 units in March, up 81.8 per cent from the 979 units they sold in February, Urban Redevelopment Authority (URA) data released on Monday showed. Last month’s new home sales were also more than double the 843 units sold in March last year, and the highest since June 2013, when 1,806 new homes were bought. Upcoming executive condo launches include Hundred Palms Residences EC, Yio Chu Kang EC, Inz Residence EC, Anchorvale Lane EC,  while existing ones include The Terrace EC, Brownstone EC, The Vales EC, Parc Life EC , Sol Acres EC EC, The Visionaire, Bellewoods EC, Signature at Yishun, The Criterion EC and Northwave EC. Hundred Palms Residences details and Hundred Palms EC show flat will be available shortly.

Mr Ong Teck Hui, national director of research and consultancy at property consultancy JLL said: “This is the most significant month since June 2013 with primary market sales of private homes harking back to pre-TDSR (Total Debt Servicing Ratio) levels. Not only are new launches doing well, but previously launched projects as well, since more than half of the March private home sales are attributable to such projects.”

Developers launched 1,527 new homes for sale in March, 16.7 per cent more than the 1,308 units in February.

These included those at Grandeur Park Residences, a 720-unit development next to Tanah Merah MRT station, where 484 units were sold at a median price of S$1,406psf; and Park Place Residences next to Paya Lebar MRT station, where all 217 units released in Phase One were sold at a median price of S$1,805psf.

Other top-selling projects in March were Parc Riviera in West Coast Vale, where 163 units were sold at a median price of S$1,246psf; The Santorini in Tampines, where 60 units were sold at a median price of S$1,031 psf; and The Clement Canopy in Clementi, where 59 units were sold at a median price of S$1,366 psf.

“The demand pick-up has led developers of numerous previously launched projects to confidently release more units for sale, as seen in The Trilinq (Clementi), Parc Riviera, The Springside/Brooks I & II (Sembawang), Marine Blue (Marine Parade), Kingsford Waterbay (Upper Serangoon), Highline Residences (Kim Tian Road) and Stars of Kovan, which released between 50 and 105 units each in March.

“This is reflective of a broad-based improvement in demand with buyers not just attracted to newly launched projects, but to those launched previously as well,” Mr Ong added.

In the first quarter of this year, an estimated 3,141 private residential units were sold by developers, the strongest quarter of new home sales since the second quarter of 2013, according to JLL.

Analysts said the easing of the Seller’s Stamp Duty (SSD), effective for properties bought on or after March 11, boosted new home sales. Home owners now have to wait three years instead of four before selling their properties to avoid paying the SSD, and the rate was reduced by four percentage points for each tier.

“Buyers are more prepared to make a purchase, in view of prices possibly bottoming out. The impetus to procure land is becoming more urgent for developers as the unsold inventory of projects in the market is steadily being cleared,” noted Mr Joseph Tan, executive director of residential services at CBRE.

The TDSR was also eased, with the 60-per-cent threshold no longer applicable to mortgage equity withdrawal loans with loan-to-value ratios of 50 per cent and below.

“In 2016, sales volume was improving gradually as price declines moderated. If the current upbeat trend of new home sales continues, it could mark a new phase in the market, characterised by stronger sales volume, prices bottoming and turning the corner,” said Mr Ong.

However, Mr Steve Melhuish, co-founder and vice-chairman of real estate firm PropertyGuru, cautioned that it may be some time before private property prices bottom out.

“Transactions have picked up this year and we have seen a 3-per-cent increase in listings on our website to sell properties. But the supply overhang continues amid macro issues such as the economic downturn and low immigration rate, translating into a moderate decline in prices,” he said.

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