New private home sales picked up last month, recovering from the doldrums they sank into in March after developers shaved prices, and analysts said the market will become more active with several attractive launches expected in the coming weeks.
Last month, 745 private homes were sold, 55 per cent more than the 480 units offloaded in March, data released by the Urban Redevelopment Authority (URA) yesterday showed. The increase in sales was achieved despite developers launching fewer units last month, with 586 private homes being offered for the first time, 23 per cent lower than the 724 units in the previous month.
Compared with the same month a year ago, launches and sales fell 50 and 46 per cent from 1,162 and 1,384 units respectively.
Analysts said that while the cautious mood among buyers persisted following repeated rounds of property market cooling measures, sweeteners and price cuts offered by developers have been successful in attracting some of them back to the market.
Ms Christine Li, head of research and consultancy at property agency OrangeTee, said: “April seems to fare quite well for both the new launches and relaunches. One reason is that developers have priced these projects more realistically, both in terms of the total quantum and the per-square-foot (psf) price, to counter the cumulative effect of cooling measures and loan curbs, drawing buyers back to the show flats.”
The 99-year leasehold Lakeville, the latest offering in Jurong Lake District, was the best-selling development last month, with buyers snapping up 210 of the 230 homes launched at a median price of S$1,318 psf.
The only other new launch during the month, The Sorrento, a freehold project in West Coast Road, also did well with 125 of 131 homes sold at a median of S$1,414 psf.
The two projects helped to prop up sales in the Outside Central Region, or suburbs, by 63 per cent to 487 homes, the URA data showed. Sales volume in the Rest of Central Region rose 87 per cent to 237 units, largely due to the relaunch of Sky Habitat in Bishan at lower prices.
CapitaLand, the developer of Sky Habitat, sold 130 units last month at a median of S$1,377 psf — significantly lower than the S$1,583 psf when the project was first launched two years ago, noted Mr Nicholas Mak, executive director of research and consultancy at SLP International. This brings the total number of homes sold in the development to 312.
“Sales for Sky Habitat have been tepid after April 2012, with the monthly sales volume never exceeding 10 units. The project’s sales even tanked in February and March this year with no sales recorded. The developer’s strategy to reduce prices has obviously succeeded in drawing back buyers’ attention. The Sky Habitat story is a clear example that it is now a buyer’s market,” he said.
Meanwhile, sales in the Core Central Region, or city centre, fell 61 per cent to 21 units last month.
Analysts said the monthly sales volume could trend upwards if developers continue to price their units competitively.
“With reduced demand in the market and buyers looking out for bargains, pricing is crucial in moving sales. Currently, the sweet spot seems to be a 10 to 15 per cent price adjustment below previous levels in order to attract buyers,” said JLL’s national director of research and consultancy Ong Teck Hui.
With developers ramping up launches this month before the seasonal slowdown in June, Ms Li said this month’s volume could breach 1,000 units. New projects due to hit the market this month include Commonwealth Towers, Coco Palms, Waterfront@Faber and Kallang Riverside.
Source : Today – 16 May 2014