New private home sales up 3.5% in January amid resilience, fewer launches

Feb 16, 2022

Singapore

NEW private home sales were stable in January despite fewer launches during the month, latest data from the Urban Revelopment Authority shows. Developers in Singapore sold 673 new private homes in January, inching upwards by 3.5 per cent from 650 in December, when new cooling measures kicked in.

The January tally is the highest private home sales for the month of January since 2014, with the exception of January 2021, noted Wong Siew Ying, head of research and content at Propnex Realty.

Including executive condominiums (ECs), which are a public-private housing hybrid, sales reached 725, just 0.8 per cent higher than that of December 2021.

Tuesday's data from the URA was higher than consultants' early flash estimates published on Thursday (Feb 10).

Year on year, last month's new home sales is 58.8 per cent lower than the 1,633 units sold in January 2021. That said, last year's volume was boosted by a number of mega launches.

In contrast, the number of units launched for sale in January 2022 is the lowest since February 2021's 167 units, noted Nicholas Mak, ERA Realty's head of research and consultancy.

Last month saw 178 units launched, of which 127 were in the outside of central region (OCR), accompanied by a subdued 29 units and 22 units launched in the rest of central region (RCR) and core central region (CCR) respectively.

New projects launched include Belgravia Ace, which put 85 of its 107 strata landed housing units up for sale, and Ikigai with 16 boutique units.

Belgravia Ace moved 77 homes during the month at an average price of S$4.4 million or S$1,080 per square foot (psf), making it the second best-selling project in January after Normanton Park, where 94 units were sold at a median price of S$1,841 psf.

According to Leonard Tay, head of research at Knight Frank Singapore, this is "a subtle testimony to the underlying strength of the private residential market".

Tay added that the stock of landed properties in Singapore has stagnated at over 73,000 units in the last four years and is not expected to grow substantially in future.

He said: "Landed homes in Singapore have been one of the top-performing asset classes in the real estate market, surpassing sales performances over the last decade."

Last month, most of the sales excluding EC were in the RCR (42.9 per cent), followed by the CCR (40.9 per cent) and OCR (16.2 per cent).

January's performance also suggests that demand for new private homes has not been severely hit by the new cooling measures, Wong noted.

"Previous rounds of cooling measures seemed to have a greater impact on the new sale market," said Christine Sun, OrangeTee & Tie senior vice-president of research and analytics.

She noted that after the implementation of new Additional Buyer's Stamp Duty (ABSD) measures in January 2013, sales volume excluding ECs dropped by 64.9 per cent month-on-month and 70.5 per cent year-on-year to 712 units in February 2013.

"Likewise, new home sales excluding ECs plunged 64.2 per cent from 1,724 units in July 2018 to 617 units in August 2018 after new cooling measures took effect on Jul 6, 2018," she said.

"Comparatively, sales volume rose 3.5 per cent from 650 units in December 2021 to 673 units in January 2022."

Ong Teck Hui, senior director of research & consultancy at JLL noted that "an examination of resale data in URA Realis shows a 43.2 per cent drop in transactions of private homes, from December 2021 to January 2022, based on caveats lodged".

"The cooling measures has led to a stand-off between buyers and sellers, due to a mismatch in price expectations which dampens transaction volume," he said.