Private home sales surge 29%

[mr funny]

http://www.straitstimes.com/PrimeNew...ry_669306.html

May 17, 2011

Private home sales surge 29%

Strong interest in mass market homes drives growth: Analysts

By Esther Teo, Property Reporter


PRIVATE home sales had a strong run last month, with total sales rising 29 per cent from March to a five-month high of 1,788 units.

Analysts say strong interest in mass market homes, especially two large suburban projects, was the key driver in the higher than expected sales total.

The latest robust figures come despite tough market cooling measures in January, and three earlier rounds of measures.

Experts say prices are likely to rise in tandem with the boost in sales, although at a gradual pace.

Fresh cooling measures are now a 'strong possibility' given buying momentum, Colliers director of research and advisory Chia Siew Chuin said yesterday.

Still, while the Government should track the market closely, it should not impose a fifth set of measures unless buying exuberance is sustained, coupled with a faster pace of price rises, she said.

Including sales of executive condos (ECs), 1,901 units were sold in April. March was significantly lower at 1,543 including ECs and 1,386 units without.

Experts say April's figures were mainly driven by launches. Two large suburban projects - Eight Courtyards in Yishun and Hedges Park Condominium in Upper Changi - made up 32 per cent of sales.

Last month alone, 2,049 new homes were launched, the most since the start of the year.

Experts add suburban sales, which made up 56 per cent of total sales volume last month, also indicate sustained interest in private homes by HDB upgraders.

Savills' senior manager of research and consultancy, Ms Christine Sun, however, noted that most new launches saw a less than 60 per cent take-up rate of launched units. 'This may imply that the healthy demand may not be representative of the entire market's sales condition,' she said.

Last month's figures are the highest since 1,915 homes found buyers in November, according to data on the Urban Redevelopment Authority's website.

Experts also say prices across all segments have firmed. Ms Sun said median launch prices of some recent projects seemed higher than others launched in the same area a few months back.

If the strong buying momentum continues, developers could be encouraged to gradually edge prices higher, they said.

Returning interest in city centre homes from local and foreign investors is also evident with 15 units sold at $3,000 psf and above last month - the highest since December, Savills said. The most expensive home sold last month was at The Orchard Residences for $4,799 psf.

Analysts say this interest might be due to Singapore's stable economic and political landscape drawing investors, given the turmoil in the Arab world and Japan's nuclear disaster.

Experts, however, do not expects last month's strong sales figures to continue.

Cushman & Wakefield senior manager of Asia-Pacific research Ong Kah Seng said April's sales followed a period of subdued launches and limited choice.

CB Richard Ellis Research executive director Li Hiaw Ho said the market is aware that the Government is reviewing the income ceiling for public housing. This has led to apprehension about the impact on the mass market.

Top selling projects include Eight Courtyards with 340 units sold at a median price of $789 per sq ft (psf); Hedges Park Condo, 224 homes, at $889 psf; and Centra Heights, 90 units at $1,624 psf.

[email protected]

[mr funny]

http://www.businesstimes.com.sg/sub/...62340,00.html?

Published May 17, 2011

Home sales hot up with 29% April spike

Developers move 1,788 units, the highest volume since November; some analysts now expect May sales to hit at least 1,500 - and maybe even outstrip April's number

By UMA SHANKARI

(Singapore)


SALES of new private homes (excluding executive condos) rose 29 per cent in April to a five-month high as developers pushed out more projects to ride on the buying momentum amid risk of further policy changes from the government.

Developers sold 1,788 units last month - the highest monthly volume since 1,915 units were sold in November 2010, according to data from the Urban Redevelopment Authority (URA). In March 2011, 1,386 new private homes were sold.

The number of homes launched by developers climbed by 64 per cent to 2,049 units.

'It (April) is the strongest performing month since November 2010, when 2,331 units were launched and 1,915 units sold following a short lull in September and October after the cooling measures of August 2010. At that time, potential buyers stayed away from the market for a couple of months, only to return optimistically in November, pushing up that month's figures,' said Credo Real Estate executive director Ong Teck Hui. 'The question is whether we are seeing a repeat of November's phenomenon. After the measures in January 2011, we saw a moderation in February and March and now there is a resurgence in April, indicating that more buyers are back in the market. A sustained uptrend in May will confirm that the market is getting buoyant again.'

The government imposed a seller's stamp duty of up to 16 per cent for private homes in January this year, and further cut the loan-to-value ratio for buyers with existing mortgages to 60 per cent.

Much of the buying momentum in April came from the Outside Central Region (OCR), where suburban condos are located. URA's data showed that 1,010 homes were sold in the OCR in April, up from 631 homes in March.

The preference for cheaper suburban homes could also be seen in a price band analysis by Colliers International. Some 779 units went for $1,000 per square foot (psf) or less in April, which amounted to 44 per cent of all units sold in the month.

In comparison, just 391 homes were sold for $1,000 psf and under in March, making up 28 per cent of all units sold.

Two large projects in the OCR region, Eight Courtyards (from Frasers Centrepoint and Far East Organization) and Hedges Park (from Hong Leong Group, City Developments and TID) accounted for 32 per cent of all units sold in April. At Eight Courtyards, 340 units were sold at a median price of $789 psf, while at Hedges Park, 224 units were sold at a median price of $889 psf.

Looking ahead, analysts expect May home sales to hit at least 1,500 units - and maybe even outstrip sales in April - as there have been many launches this month. Take-up should be strong as developers are rolling out more small units, which sell at relatively more affordable prices of under $1 million per unit, analysts said. 'We visited three showflats and noted that demand on the ground remains fairly strong,' said DBS Group Research analyst Lock Mun Yee yesterday. 'Buying interest is still centred on well-located developments with units priced at smaller quanta, as well as mass market projects.'

At Wing Tai Holdings' 496-unit Foresque Residences at Upper Bukit Timah, around 100 units have been sold at about $1,100-1,300 psf, sources said.

Other developments that saw steady sales recently include Hoi Hup Realty's 141-unit The Forester @ Mount Faber, where around 50 per cent of units were sold at an average price of about $2,000 psf; and the 69-unit 10 Shelford from Adam Properties, which saw a take-up of about 60 per cent of units at about $1,800-2,000 psf. Both developments offer a large proportion of small units.

But analysts noted that policy changes could affect market sentiment in the coming months.

During the campaign for the general election, National Development Minister Mah Bow Tan mentioned that the household income ceiling for buying new HDB flats will be reviewed in the next six months. The ceiling has been unchanged at $8,000 for the past 17 years, and could be raised to $10,000 - although the actual level will be decided after the review.

'As the market is aware that the government is reviewing the income ceiling for public housing, there is some degree of apprehension as to how it will impact the mass market,' said Li Hiaw Ho, executive director for CBRE Research.

Measures in the HDB sector will have an indirect impact on the demand for mass, and to a certain extent, mid market properties, said Citigroup economist Kit Wei Zheng.

'First, higher HDB income ceilings would channel some of the current demand from the HDB resale and mass market private properties away. If HDB resale prices decline, it would also affect the ability of potential HDB upgraders to move to mass or mid-market private properties,' Mr Kit said.

For now, buyers are likely to adopt a 'wait-and-see' approach, said Colliers' director of research & advisory Chia Siew Chuin. 'They are likely to be more selective and price-sensitive. However, affordably priced projects with good attributes are still expected to enjoy healthy sales.'