Developer sales fall 44.9% in September, less projects were launched during Ghost Month

Overall, market watchers predict that private new home sales that exclude ECs and ECs, will be between 6,000 and 7,000 units this year – a tad lower than the 7,099 homes sold last year.

The cooling measures that were implemented in April have contributed to “cloudy” and “slightly chilly” buyers’ mood.

The increased Additional Buyer Stamp Duty (ABSD), the widespread inflation and economic uncertainty, along with the rising number of public housing options, such a Build-to-Order launches, are all factors that buyers consider when weighing their options.

In the OCR the OCR, sales of properties fell by 64 percent month on month, to 70 units. For the Rest of Central Region, it dropped by 33 per cent from month to month.

The freehold Pullman Residences Newton came in the second-highest, having 21 units sold for the median price of $3,258 psf. Core Central Region (CCR), out of three segments, performed “relatively” better than the other segments. The 76 units sold within the CCR accounted for 35 percent of all condo and private apartment purchase in September.

ECs were the only bright spot that was sold, with 118 units in the month of June. Demand for ECs has been strong, because buyers who are price sensitive want the next best alternative to buying a home. Buyers of ECs are also eligible to receive ABSD upfront reduction.

In September, including ECs 335 units have been sold and 68 were launched. Comparatively, 649 units were purchased and 995 units were launched in August.

Due to the vast array of products on the market, consumers have become more selective in their selections.

According to the data that was released on Monday (16th October) by the Urban Redevelopment Authority, developers sold 217 homes for sale in September. This is a drop of 44.9 percent compared to the 394 units that were moved in August.

The primary home sales in 2023 are expected to be 5,407 homes, which is less than the 6,409 homes sold in the same time frame last year. This is the lowest since 2016, when 5,656 homes were sold.

Some buyers avoid buying a home during the festival due to traditional beliefs. Developers are advised to stay clear of launching projects during this time.

Just one new project was announced in September the 999-year leasehold The Shorefront at Jalan Loyang Besar in the Outside Central Region (OCR) and saw three of its 23 units being sold with a median value of S$1,902 per square foot.

The most recent September sales figures that excludes executive condominiums (ECs) are just a quarter of 987 units that were sold in the same month of 2022. This is also the month that has the lowest number of sales in the year thus far, and also since December 2022 when developers sold 170 units, noted Huttons data analytics senior director Lee Sze Teck.

Developers will have to be cautious about pricing these forthcoming project launches to support sales volume. There won’t be significant price reductions as the developers are already made commitments to capital expenses.

New private home sales declined in September, and were slowed by a lack of new projects launching during the inauspicious Hungry Ghost Festival.

The drop in sales of property was expected, given that the Hungry Ghost Festival ended only in the middle of September.

Altura Bukit Batok was the only EC-project that was launched in the year 2000. The project’s overall sales reached an 88 percent rate. Altura was also the most-sold project for a second consecutive month, with units sold for a median of S$1,473 per square meter (psf) during September.

Analysts expect that the future is likely to be a slow one for developers and buyers, as a result of increasing interest rates and macroeconomic uncertainty.

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The major projects coming up will mainly be concentrated within the OCR. These include the 265-unit Lentoria and the 474-unit Hillock Green in the new Lentor Hills estate. In Jurong there is the J’den Condo, situated in the site of the former JCube Mall, will comprise 368 units. The 440-unit Sora condominium, located at Yuan Ching Road, will also be constructed. There is also the 341-unit Hillhaven at Hillview Rise.

Altura has also set the benchmark price for the EC market last month by selling a unit measuring 980 square feet for S$1.6m or S$1,585 per sq ft. The price is more than the previous price high held by Copen Grand, which stood at a price of S$1,499 psf.

With a softer mood, higher interest rates and the upcoming December holiday season, developers might choose to push launches into 2024 when interest rates fall and sentiment improves.

The increasing geopolitical tensions across the world and the potential negative effects of the recent conflict in the Middle East may also dampen the mood in the market for real estate.

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