New launches set to lift Feb-March home sales figures
[SINGAPORE] New property launches in the coming weeks are expected to give a fillip to developers’ private housing sales this month and next, following a lacklustre January which saw 565 units being sold in the primary market.
Although the January figure is more than double the 259 private homes developers moved in December, it is just 28 per cent of the 2,028 units they sold in January last year, despite the seventh round of property cooling measures announced in that month. In fact, last month’s primary-market sales volume was the lowest recorded for the month of January since the 108 units in January 2009 during the market nadir after Lehman’s collapse.
Market watchers note that last month, developers chose to hold back launches amid the lull leading up to Chinese New Year festivities this year, on the back of generally weak sentiment ever since the Total Debt Servicing Ratio (TDSR) was introduced in late-June 2013.
Urban Redevelopment Authority figures show that last month, developers launched 549 private homes, more than four times December’s 118 units but a sliver of the 1,814 units released in January 2013.
The top-selling project last month was The Hillford in Jalan Jurong Kechil in the Upper Bukit Timah area. Marketed as a retirement resort, the 281-unit development sold out because of its attractive pricing, made possible by a shorter-than-usual site tenure of 60 years. The median price achieved for the project was $1,105 psf, according to URA’s statistics yesterday.
The Hillford helped to push up the percentage of developer sales in the up to $1,500 psf band to 85.1 per cent – compared with 66.8 per cent in December, shows Colliers’ analysis.
Wheelock Properties (Singapore) achieved a $1,343 psf median price for the 58 units it sold in January at The Panorama in Ang Mo Kio Avenue 2. The 120 units the developer released in the 698-unit, 99-year leasehold condo are said to be on lower floors.
As for this month, property consultants’ forecasts of developer sales range from 600 to over 1,000 units.
Already, UOL Group is said to have moved around 210 units at Riverbank@Fernvale, where sales began on Friday. The average price is said to be slightly above $1,000 psf.
Next door, Frasers Centrepoint, Far East Orchard and Sekisui House are expected to begin sales this Friday at Rivertrees Residences. The average price is tipped to be around $1,050-1,060 psf for the project, which boasts a longer frontage of Sungei Punggol reservoir and is much closer to an LRT station. Both projects are on 99-year leasehold sites.
Last month, developers sold 45 executive condominium (EC) units, down from 74 units in December and 256 units in January 2013. Including ECs, which are a public-private housing hybrid, developers moved 610 homes last month, up from 333 homes in December but much lower than the 2,284 units they sold in January 2013.
For the whole of 2014, most property consultants predict developers could sell around 10,000-12,000 private homes excluding ECs. Last year’s figure was 14,948 units, down from 2012’s record of 22,197 units.
Prior to TDSR, developers were enjoying “sure sales” when they launched projects, notes Jones Lang LaSalle national director Ong Teck Hui. “The biggest challenge right now is how to move sales.”
Knight Frank chairman Tan Tiong Cheng said right pricing is the most critical factor for new launches these days.
Buyers have become more price-sensitive post-TDSR and, at the same time, are spoilt for choice. “In recent times, developers have paid high prices for land but end-unit prices have started to come off,” he notes. A developer that hangs on too long to its price risks losing buyers to competitors willing to price their project more competitively.
Frasers Centrepoint Homes CEO Cheang Kok Kheong, who is busy getting ready for this week’s launch of Rivertrees Residences, says developers’ biggest challenge currently is “to keep coming up with new products, layouts and designs to wow buyers”.
“It is naive to think that we can keep minting the same unit-types and layouts. There are so many ECs coming up, so developers of entry-level private condos need to be more imaginative to capture the upgrader market.”