SINGAPORE, 15 September 2022 – Mr Lam Chern Woon (蓝振文), Head of Research and Consulting at EDMUND TIE comments on developer sales in August 2022.
Developers moved 437 private residential units (excluding ECs) in August 2022. This is 48% lower than the 834 units sold in the previous month, due a dearth of sizeable project launches and the advent of the Hungry Ghost month. Units launched in August amounted to 134 units, 67% m-o-m lower than July’s 402 units, which translates to a higher take-up rate of 326% in August compared to 207% in July, attesting to sustained underlying demand. There were 2 new landed projects (total of 12 units) launched in August – The Jardine Residences (6 units) in the OCR and Mount Rosie Road landed housing development (6 units) in the CCR.
In aggregate, the CCR accounted for 50% of sales in the month, while the RCR and OCR accounted for 29% and 21%, respectively. Contrary to the CCR that saw an increase in sales by 19% m-o-m, both the RCR and OCR saw a decline in sales in August by 23% and 81% m-o-m, respectively. The outperformance in the CCR can be attributed to the fact that 104 new units were launched in this market segment, compared to just 24 and 6 new units in the RCR and OCR, respectively. Our analysis of the caveats showed that, in terms of buying demand by unit size within the CCR, demand rose for units sized between 1,000 and 1,500 sq ft in August (27% of total CCR units) compared to July (22%). Compared to 53% in July, 57% of homes sold in the CCR in August were priced at least S$2million, as prices inched up.
In the CCR, sales were contributed by projects such as Hyll on Holland (42 units), Perfect Ten (27 units), The Hyde (20 units) and Leedon Green (20 units), which accounted for half of the market segment’s sale in the month. In the RCR, sales were contributed by projects such as Riviere (28 units), One Pearl Bank (16 units) and The Landmark (13 units), accounting for 45% of the segment’s sales. In the OCR, sales were contributed by projects such The Gazania (16 units), The Watergardens at Canberra (12 units) and Urban Treasures (10 units), which contributed to 42% of the segment’s sales.
Among the top 10 best-selling projects islandwide, six were located in the CCR, another three were located in the RCR, while only one was located in the OCR. We observed a gravitation of demand towards the projects located in CCR as foreign demand recovers with the reopening of the borders. In addition, price pressures were noticeably firm among the 10 top-selling projects in August and especially in the CCR. Among the top 10 top-selling projects, seven projects (Hyll on Holland, Perfect Ten, The Hyde, Leedon Green, One Pearl Bank, The Avenir and The Landmark) saw higher median sales price in August as compared to July.
Looking ahead, the primary market is expected to moderate from about 13,000 units last year to about 10,000 units for 2022, on the back of tighter financing conditions, ongoing economic headwinds as well as rising interest rates. Private residential price growth is projected to ease to about 8% for the whole of this year, following last year’s 10.6%. However, the market upcycle remains intact given the healthy labour market conditions, strong household balance sheets and the tight demand-supply dynamics. Over the next few months, we expect a robust take-up for new project launches, especially if the locality has been devoid of fresh supply for some time.
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