Sales of new private homes down 27% in August

Sales of new private homes down 27% in August

Demand for new private homes fell by some 27 per cent in August with the sharpest decline seen in the mass market segment, after recording a strong rebound in July.

SINGAPORE: Demand for new private homes in August fell by some 27 per cent from July, with the sharpest decline seen in the mass market segment.

According to the Urban Redevelopment Authority (URA), 1,421 units of new homes were sold in August.

Including executive condominiums (EC), a total of 1,539 units changed hands in August - the lowest sales figure so far this year.

The fall in August followed a strong rebound in July.

Showflats were not as busy in August, as some home buyers stayed away during the Hungry Ghost festival.

It's traditionally a lull period for property sales, with developers launching fewer projects. Developers placed 1,118 units of new homes for sale in August.

835 units of mass market homes were sold in August, down 45 per cent from July.

Director of Chris International, Chris Koh, said: "There has always been a demand for suburban projects; a lot depends on whether there are new launches for buyers to choose from. Historically, the second and third quarters are one of the best quarters in the year."

Analysts expect sales to pick up in September, especially in the second half of the month with new project launches like eCO and Riversails in the pipeline.

They said new home sales could come in at between 1,600 and 1,700 units in September.

Meanwhile, sales in the core central region also dipped slightly, from 253 units in July to 218 units in August. Bucking the trend, demand for new homes in the city fringe rose - 368 units were sold in August, more than double the sales in July of 181 units.

Market watchers said the rising demand for homes in these two regions could encourage developers to launch more projects there.

In August, the top seller was One Dusun Residences in Balestier with buyers snapping up almost 153 units of the 154 units launched during the month at a median price of S$1,532 psf.

This is followed by Parc Olympia located in the Loyang area, which sold 110 units. Bartley Residences was the third best selling project with 70 units changing hands in August.

Market watchers said prices have stabilised and expect homebuyers to remain cautious amid global economic uncertainties.

Still, some analysts expect positive upside for the local residential property market after the US Federal Reserve announced its stimulus plan last week.

Director for research & advisory of Colliers International, Chia Siew Chuin, said: "We would expect an increase in interest boosted by the confidence in the market because interest rates are expected to remain low till the middle of 2015 and funds will continue to come into Singapore. We do hope that the upcoming supply in the market will help to keep any upside in prices in check, otherwise we would be faced with additional policy risk."

For the full year, analysts expect a total of 21,000 to 23,000 units of new private homes to be sold, barring any major economic crisis.

Going forward, Knight Frank consultancy said new restriction on the maximum number of units to be built could put upward pressure on prices and sales volume of shoebox units in anticipation of limited supply of small units in future launches.

Source: CNA/xq/ck