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Dismal sales of private homes in Oct
http://www.straitstimes.com/Money/St...ry_303557.html
November 18, 2008 Tuesday
Dismal sales of private homes in Oct
112 new private homes sold as sales dip to lows last seen in 2003 Sars period
By Joyce Teo, Property Correspondent
A MERE 112 new private homes were sold by developers last month, the lowest figure since monthly data was made public amid the boom in June last year.
The October figure is sharply down from 376 units sold in September, according to the data released yesterday by the Urban Redevelopment Authority.
Developers launched just 159 units last month, down from 767 units in September and a 12-month average of 559 units.
Analysts suggest last month's very thin sales are comparable to the first quarter of 2003 when the Sars outbreak crippled economic activity. Developers sold just 427 units of new private homes then.
In the first three quarters of this year, sales of private homes slumped to 3,890 units, a far cry from 14,811 for all of last year.
'The fall in the number of units launched was largely due to an obvious weakening in economic conditions, and Singapore's entry into a technical recession,' said Knight Frank's director of research and consultancy Nicholas Mak.
'In October, all major stock markets globally suffered their worst performance in decades. Singapore was not spared. In the face of such massive losses in the bourses, both sellers and homebuyers retreated to the sidelines, resulting in the low launch and sales volume.'
Things were so bad last month that some projects - among them a 59-unit landed project Watten Residences - recorded no sales at all.
Since monthly data was made available, last month was the first with not a single sale of a non-landed private residential unit at above $2,500 per sq ft (psf), Mr Mak said. In the high-end market, two condo units were sold at $2,306 psf and $2,407 psf.
There were a few quirks in the figures. For instance, a mass market condo, Lakeshore in Jurong West, sold for a relatively high $1,038 psf, said Savills Singapore's director of marketing and business development, Mr Ku Swee Yong.
Two posh 99-year leasehold bungalows at Sandy Island at Sentosa Cove were sold for a high $2,033 psf and a possible record price of $2,169 psf, or above $13 million each.
CBRE Research executive director Li Hiaw Ho said such deals last month seemed to show prices have remained fairly stable in the past two months.
'However, it is very likely that the persistent thin volume will have a downward effect on prices.'
Overall, the only project that did well was a 12-unit cluster housing development, Jewel, near Serangoon New Town, which caught the market in time. All 12 units were sold from $286 psf to $342 psf, or $1.3 million to $1.4 million each.
Over 60 per cent of the 159 units launched were landed properties, marking the first time that landed supply has exceeded non-landed supply but demand was far weaker, said Jones Lang LaSalle.
'In this current market, pricing is a great determinant of demand,' said its local director and head of research for South-east Asia, Dr Chua Yang Liang.
Chesterton Suntec International's head of research and consultancy, Mr Colin Tan, said: 'The stand-off is continuing as there are still many unrealistic sellers out there taking their cues from the quarterly price index.'
The index, which has showed only a small drop, seemed to suggest the market is still in fairly good shape.
'If the correct market signals are not given, the stand-off between buyers and sellers will likely continue with prices edging down very slowly,' he said.
'At the end of the day, sellers may not sell until they are forced to. This will occur when there is panic selling... The sharp correction will affect confidence.'
Property consultants are expecting the sluggish sales momentum to last the rest of the year and possibly through to Chinese New Year in late January given economic and job market uncertainties.
'It may well be that the fourth quarter will see a total sales volume of around 500 units, a level that was last seen in the first quarter of 2003,' said CBRE's Mr Li.
Savills' Mr Ku believes that transaction levels of new homes will remain roughly around 150 to 200 units for the next six months, with possibly 500 to 700 sub-sales and resale deals per month.
'The average number of monthly transactions for the last 10 years is about 1,300 per month, so we should be seeing lower than average transaction volumes.'
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HIT BY STOCK MARKET BLUES
'In the face of such massive losses in the bourses, both sellers and homebuyers retreated to the sidelines, resulting in the low launch and sales volume.'
Knight Frank's director of research and consultancy Nicholas Mak
Launches of private homes in October drops almost 80% on-month
http://www.channelnewsasia.com/stori...390478/1/.html
Launches of private homes in October drops almost 80% on-month
By Ng Baoying, Channel NewsAsia | Posted: 17 November 2008 2308 hrs
SINGAPORE: Only 159 private homes were launched in October this year - the lowest in more than a year.
The slide of almost 80 per cent from the 767 units launched in September was due to poor economic conditions, and the technical recession that has hit Singapore.
October's figure was even lower than the 194 units launched in August 2008, which was traditionally a slow period due to the seventh lunar month.
The central region made up almost half of the new launches in October, at 74 units.
The number of new homes sold in October also fell to 112 units from 373 a month ago.
Homebuyers stayed out of the market in October as confidence was shaken by financial turmoil and news of job cuts. And buyers were only willing to spend on properties that offered value for money.
"Price is a factor in today's market. Projects priced well in very good locations have a strong take-up," said the head of research and consultancy at Jones Lang LaSalle, Chua Yang Liang.
Analysts expect the housing market to stay weak.
Dr Chua said: "This pendulum effect we see in supply and demand will continue going into (the) next few months as developers try to ascertain what the demand is. Buyers being sensitive to market news will continue to fluctuate in their behaviour."
Analysts also said new home sales could hit lows not seen since the 1997 Asian financial crisis.
"Taking into consideration the continued lack of activity in the next two months going into the end of 2008, we expect total home sales to hit just above 4,000, potentially below 4,500. It will probably be the first time in almost 11 years that new home sales take-up will hit below 5,000," said the managing director of Cushman & Wakefield, Donald Han.
Experts said the earliest recovery could be in mid-2009, if the global economy and stock markets pick up.
Dr Chua said: "We have to see the global economic situation coming to more stable conditions before the buyer market would stabilize. Global economic fundamentals must return (and) stock markets must be predictable."
- CNA/yt
