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Latest Property Real Estate News - Published on 16/10/2013
New private home sales rose in the month of September 2013 as developers sold 1,246 private homes, excluding executive condominiums (ECs), up 68% from the 742 units sold in August. Including ECs, which are a public-private housing hybrid, developers found buyers for 1,658 homes reflecting a rise of 13% from the August’s figure of 1,468 units.
“The sustained buying activity shows that buying confidence in new private property segment generally remains healthy. September saw a surge in the total of new private homes sold (compared Q-o-Q) mainly due to the attractiveness of these new projects, namely SkyVue and Thomson Tree that are sold in that month. Moreover, these are large projects which offer over 200 units for sale. It was also noted that their strategic location, within walking distance to the MRT, right psf pricing with the right quantum as the main contributing factors for the overwhelming demand.”
We believe the Total Debt Servicing Ratio (TDSR) – introduced on June 29 is the main reason for the tepid demand in both July and August. And home buyers and investors have turned more cautious and have been more selective due to the cumulative effect of all the property curbs over the past few years. However, the upward trend for new private homes in September is mainly due to the reasonably attractive pricing in the project launches” explained Mr Mohd Ismail, CEO of PropNex Realty.
5 top selling projects with ECs commanding good demand as well
All best-selling projects were from the RCR and OCR namely SkyVue sold 433 units at a median price of $1,401psf, Sea Horizon (Executive Condominium) moved 317 units at $818psf. Thomson Three found buyers for 264 units at $1,362psf; The Glades sold 89 units at $1,518psf, whereas The Skywoods sold 37 units each at median prices of $1,290psf. In all, new homes in the RCR and OCR contributed over 66% of sales in the month due to their larger project with more units available for sale and their more budget friendly launch prices compared to other regions (excluding ECs).
“With the tighter loan curb, first time home buyers and upgraders are expected to contribute to the bulk of the sales volumes as they generally do not have other debts and should have no difficulties in securing the full 80% bank loan. We believe the emphasis will continue to be on mass market homes and ECs in the RCR and OCR as they are more budget friendly. As affordability is hit, existing home owners who still want to invest in real estate might also turn to smaller homes with lower quantum. As a result, we also expect sales of smaller homes to be popular.”
“Nevertheless, home buyers and investors will continue to remain more cautious and will be more selective with projects, and we do expect the sales activity in this segment to remain healthy mainly dependent on the sensitive pricing by the developers. We are predicting that the monthly transaction volume of new private homes in the next 3 months to be about 800 to 1,000 per month, to reach between 14,000 to 16,000 units for the entire 2013. Any upcoming projects with ideal location and are priced sensitive at the right quantum should command a good demand,” concluded Mr Mohd Ismail.
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Carolyn Goh
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P & N Holdings Pte Ltd (holding company of PropNex Realty)
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