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Latest Property Real Estate News - Published on 17/02/2014
2014 will be a challenging year for private residential sales in Singapore
Developers sold 565 private homes, excluding executive condominiums (ECs) in January 2014, up over 118% from the dismal 259 units sold in December. This is largely due to the launch of two major developments—The Panorama at Ang Mo Kio Avenue 2 and The Hillford at Upper Bukit Timah. Including ECs, developers found buyers for 610 homes, which also reflect a rise of 83% from the previous month’s figure of 333 units.
Analysing the figures, Mr Mohamed Ismail, CEO of PropNex Realty said: “Prospective homebuyers are exercising even greater caution in their capital outlay before committing to make the property purchase, more so now that there are numerous buying curbs in place; I believe that buyers will continue to be highly sensitive to properties with a higher overall quantum”.
In 2014, Mr Ismail refuses to rule out the possibility of having even fewer new private residential homes being transacted—as the impact of the curbs such as the TDSR and ABSD, are unlikely to wear off anytime soon. Developer sales peaked in 2012 with over 22,000 transactions but slowed to about 15,000 in 2013. It could moderate further by 20 to 30% in 2014, judging from the trend in the second half of 2013.
Slower sales in new projects could have possibly led developers to price their projects more sensitively to reflect the current market sentiments.
“The TDSR has greatly cut down a buyer and/or investor’s leverage power by means of mortgage loan, as their purchasing power has been eroded. Moving forward, only those projects which are well-priced and strategically located could entice the buyer to make a commitment,” Mr Ismail comments.
The Hillford —best seller in January
All best-selling projects were from the OCR and RCR namely; The Hillford, which sold 281 units at a median price of $1,105psf, The Panorama moved 58 units at $1,343psf. La Fiesta found buyers for 16 units at $1,177psf; Both Bartley Ridge and Thomson Three sold 15 units each at $1,220psf and $1,306psf.
Location and pricing crucial to attract buyers who are becoming more selective than before
When forecasting sales performance in 2014, Mr Ismail predicts that about 11,000~12,000 new homes could be sold by developers, given the healthy land sales for residential property last year. But developers will have to launch their projects timely yet cautiously as today’s market is becoming a buyers’ market.
Post TDSR property sentiment is expected to continue to be muted in the immediate future. However, the longer term prospects for the Singapore real estate market remain intact, supported by steady population growth, rising affluence and the allure of property as an investment tool for locals.
“"Going forward, pricing will be key and developers have to price attractively to move units quickly," Mr Ismail cautions. Nevertheless, excessive growth is unlikely due to the government measures and fragile global economic recovery. Home buyers and investors will continue to remain selective with projects, but those that are priced at the right quantum will see good demand,” concluded Mr Ismail.
For media enquiries, please contact:
Corporate Communications and Marketing Manager
P & N Holdings Pte Ltd (holding company of PropNex Realty)
480 Lorong 6 Toa Payoh #10-01 HDB Hub East Wing Singapore 310480
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