Published June 2, 2009

Developers sell close to 1,200 homes in May

Estimated number based on BT survey comparable to April figures; Frasers Centrepoint leads the pack


DEVELOPERS sold an estimated 1,200 private home units in May, according to market watchers. This is comparable to the 1,207 units they sold in April, based on official Urban Redevelopment Authority (URA) numbers.

A BT survey across nine developers as well as some property agents yesterday already showed that some 1,130 units were sold last month. 'Developers could have easily sold about 1,200 units in May if you include all the smaller pockets of developments as well,' a seasoned residential property consultant estimated.

However, BT understands that some units may also be returned by buyers who may have got caught up in the home-buying frenzy fuelled by the stockmarket rally in the past few weeks.

Frasers Centrepoint sold a total 294 units in May - comprising 186 units at Martin Place Residences at Kim Yam Road, 46 at Caspian in the Jurong Lake District, 22 units at Woodsville 28, and 40 homes at Waterfront Waves.

Frasers Centrepoint is developing Waterfront Waves, near Bedok Reservoir, jointly with Far East Organization. The latter sold a total of 165 units (inclusive of Waterfront Waves) last month.

BT eliminated the double-counting for joint-venture projects in arriving at the May sales tally.

City Developments reported total sales of 138 units (of which 97 units came from The Arte at Thomson and 36 units from Livia in Pasir Ris) in May.

CapitaLand also achieved brisk sales for The Wharf Residence at Tong Watt Road.

EL Development also found buyers for a total of 74 units last month (comprising Parc Centennial at Kampong Java Road and Rosewood Suites in Woodlands).

Soilbuild is understood to have sold close to 90 units at The Mezzo in the Balestier location. In other developments, sales of around 30 units were seen for Kovan Residences and 21 units at BelleRive in Bukit Timah.

According to official government numbers, developers sold 1,332 private homes in February, followed by 1,220 units in March and 1,207 units in April.

Lower property prices have been the main attraction for buyers, said DTZ executive director Ong Choon Fah.

Many developers have either re-priced or re-sized their units to make them more affordable.

Many people also feel that residential property prices have corrected substantially, she added.

'The thinking is: whether it's the bottom or not, probably the worst is over so it's about time to go in.'

The recent stockmarket rally has also helped to improve sentiments, Mrs Ong said.

With sales momentum gathering, developers have been gradually inching up prices for mass-market and mid/upper segment projects, following earlier price reductions from the 2007 peak levels.

However, pricing power is not expected to return to developers of luxury projects anytime soon. 'The price push in 2006-2007 period came from overseas buyers; this segment is still out of action,' a developer said.

A veteran developer observed that buyers now include those who had been sidelined by the rapid price surge in 2007.

Whereas the 2006/2007 residential property bullrun was substantially wealth-driven, with a strong element of overseas money, the current recovery in home buying has started in the mass-market and is now permeating to the mid/upper-middle segments, he added.

'So this is a traditional, bottom-up recovery, which is more sustainable. Upward price movements will be constrained by affordability at the end of the day,' he added.

DTZ's Mrs Ong too agrees that while there is 'cautious optimism' in the property market, developers are unlikely to raise prices significantly at this point in time.

Some developers may have lowered the level of discounts for projects that have sold well but they are doing this carefully.

'You don't want to derail the momentum that has been built up,' she said.