Property buyers in Singapore continue to plonk down serious money for new private homes despite worries over the ongoing Covid-19 outbreak.
Luxus Hills announced over the weekend that it was completely sold out, while buyers also snapped up another 32 units at The M.
Consultants said the two projects have done well for specific reasons like incentives offered and competitive pricing; it also reflects confidence in Singapore’s fundamentals, and should not be seen as the private residential market heating up.
Developer Bukit Sembawang Estates said on Sunday that its Luxus Hills (Contemporary Collection) project was fully sold after two weeks of sales.
The project in Seletar consists of 39 houses. The developer said it set a new benchmark for pricing, with the average price for inter-terraces at S$3.35 million, or S$2,070 per square foot.
Over at Wing Tai Asia’s The M, in the Ophir-Rochor corridor, buyers snapped up a total of 75 per cent or 392 units at the 522-unit condominium, over the past two weekends.
The M and Luxus Hills probably bucked trends for two reasons, said Christine Li, Cushman & Wakefield’s head of research for Singapore & Southeast Asia.
The Contemporary Collection, the final phase of Bukit Sembawang’s 999-year leasehold landed development, is a landed project with only 39 units. It has already received its TOP (temporary occupation permit), which means buyers can move in immediately and there are several flexible payment schemes, she said.
The developer said the project offered deferred payment schemes which were well-received. The schemes catered to homebuyers who are awaiting proceeds from the sale of properties or those undergoing enbloc sales.
Its Stay & Pay scheme lets buyers move in right away with just a 20 per cent down payment, while a Reservation Scheme allowed buyers to reserve their home with just a 10 per cent deposit.
Said Ms Li: “The developer is also smart to push out completed units to target those who have sold their properties in the previous en bloc cycle and are flush with cash. This is also the reason the earlier phase was also fully sold within days after it was launched in August.”
Last year, Bukit Sembawang sold out its 78-unit Signature Collection at Seletar Hills by Sept 1 with similar flexible payment schemes which proved popular with buyers who snapped up 71, or more than 90 per cent, of the units on the first launch weekend. Signature Collection units started at S$3.058 million.
At The M, prices averaged S$2,450 psf. Ms Li noted it is considered fairly underpriced compared to new sales in districts 1, 2, and 7.
Midtown Bay sold a total of 46 units at S$2,926 psf since its launch in Q4 2019. Marina One Residences sold a total of 78 units at S$2,540 psf from Q1 2019 until February 2020. One Pearl Bank sold 255 units at S$2,371 psf since launch in Q3 2019.
“Singaporeans can still smell good deals even with masks on,” quipped Ms Li.
Low interest rates plus cash-flush investors will continue to encourage the buying of homes because of Singapore’s fundamentals.
Christine Sun, head of research and consultancy at OrangeTee & Tie, said: “Despite the current crisis, Singapore had continued to keep faith with the fundamentals that have drawn many investors in the past such as having strong governance and being open and transparent, and our efforts in tackling the virus may have preserved investors’ confidence.
“This could be one of the reasons investors have continued to buy projects in Singapore especially luxury properties last month.
“Many investors would be turning to safe-haven assets to protect themselves in periods of market uncertainties, therefore, some may have shifted their investments from equities and bonds to alternative assets like properties in Singapore.”
Tricia Song, Colliers International head of research for Singapore said the good sales at new launches so far, in particular The M and Luxus Hills, can be due to the underlying demand for homes, low interest rates and the low unemployment rate in Singapore.
“Employment is an important factor in supporting home sales,” she said.
While a number of companies have announced measures such as pay cuts for senior managers, no-pay leave and hiring freezes to manage business costs, it appears that the impact of the Covid-19 outbreak has so far not led to widespread job losses, said Ms Song.
“Should the outbreak become more protracted – stretching into the second half of 2020 – the impact on home sales may be more keenly felt
“Private home prices in Singapore have been fairly stable, up by 2.7 per cent in 2019, and the sense is that buyers generally do not think prices will fall substantially at this juncture.”
Based on Realis data, 739 new non-landed private homes (excluding ECs or executive condominiums) were sold from Feb 1 to 23 – already higher than for the full month of January 2020 and February 2019.
On buyers’ profile, foreigners bought 39 new homes in February, relatively in line month-on-month and in fact, more than double year-on-year, compared to the 19 units in February 2019, Ms Song noted.
EC project OLA Residences in Sengkang has received 1,163 e-applications, more than double the 548 units in the Spanish-themed development offered. ECs are a public-private housing hybrid.
Jointly developed by EVIA Real Estate and Gamuda Land, OLA attracted over 4,000 visitors over the weekend to the show gallery, the developers said in a press release on Monday.
E-applicants will be grouped according to first-time and second-time buyers, and can select and book units on March 21, a spokesman said.
Final pricing for the units is expected to be announced on March 19 or 20.