News: New private home sales hit two-year high in September

Oct 16, 2020

New home sales in September hit 1,329 units, a 5.6% increase from August’s 1,258. Sales also continued to increase for the fifth consecutive month since the circuit breaker measures were implemented. This is also the highest monthly sales since July 2018, when 1,724 units were shifted.

Despite still being in the midst of a recession, new home sales showed little signs of slowing down. In September, developers sold 1,329 new private homes (excluding executive condominiums (ECs)), up 5.6% from 1,258 units in August, according to Urban Redevelopment Authority (URA) data.

This marks the fifth straight month-on-month (m-o-m) increase since the circuit breaker measures were implemented in April. This is also the highest monthly sales since July 2018, when 1,724 units were shifted.

On an annual basis, new home sales increased 4.6% from the 1,270 units transacted in September 2019.

Penrose emerged as the best-selling project in September, with 389 units sold. It is followed by Treasure at Tampines and Jadescape, which moved 115 units and 62 units, respectively.

Completing the top five projects for the month are The Garden Residences, which shifted 59 units, and The Woodleigh Residences, which sold 57 units.

Project Name

Units Sold in the Month

Median Price ($psf)

Lowest Price ($psf)

Highest Price ($psf)

Penrose

389

$1,541

$1,396

$1,856

Treasure at Tampines

115

$1,379

$1,154

$1,620

JadeScape

62

$1,774

$1,595

$1,901

The Garden Residences

59

$1,606

$1,407

$1,768

The Woodleigh Residences

57

$1,926

$1,804

$2,453

Source: URA, Huttons Research

The Rest of Central Region (RCR) led new home sales in September as it accounted for 64.6% of total sales. The Outside Central Region (OCR) made up 29% and the Core Central Region (CCR) 6.3%. 

Overall, developers sold 7,532 units in the first nine months of 2020, up 0.8% from the 7,469 units shifted over the same period last year.

Recommended article: Upgrading From a HDB: Should You Get a Private Condo or an Executive Condo in Singapore?

“New home sales, backed by robust demand, have outperformed expectations time and again in recent months. We have observed that there remains a sizable pool of genuine buyers, HDB upgraders, and investors with ready funds to enter the market to take advantage of the more attractive pricing amid the challenging economic conditions,” said PropNex CEO Ismail Gafoor.

Suggested read: Are Singaporeans Superstitious About Buying And Moving House During the Hungry Ghost Festival?

Lee Sze Teck, Director of Research at Huttons Asia, noted that while the city-state is “headed for its biggest recession on record, the contraction is not broad-based and in part due to the two-month circuit breaker”.

“Buyers right now probably have a greater visibility on the potential challenges and opportunities ahead, and are in a better position to make a buying decision,” said Wong Siew Ying, Head of Research and Content at PropNex. 

“Additionally, some buyers may see property as a less volatile investment vehicle – compared with the financial markets – that will help to hedge against inflation and preserve their wealth amid this crisis.” 

Christine Sun, Head of Research & Consultancy at OrangeTee & Tie, said the robust sales inked in the last few months could “be attributed to strong underlying demand from local buyers”. In fact, Singaporean purchases reached an 11-year high in September.

“According to URA Realis data, Singaporeans accounted for the bulk of non-landed new purchases with 1,070 transactions, constituting 87.4% of the 1,224 new non-landed home sales in September. This is the highest monthly proportion of Singaporean purchases since April 2009 when 87.7% of non-landed new home sales were inked,” she said.

Singapore Permanent Residents (PR) purchased 118 non-landed new homes, while non-PRs acquired 35 units.

“Many Singaporeans especially high net worth individuals have been looking out for value-assets to grow their wealth and are planning to ride on the wave of market recovery. They may feel that it is a good time to enter the market now since prices will likely rise after the pandemic and Singapore’s economy is positioned for a gradual recovery with many sectors being reopened in recent months,” said Sun. 

Looking ahead, Lee believes that there will be an initial knee jerk reaction to the Controller Of Housing’s new policy on the reissue of options, which he says “will take the wind out of the sails in the short term”. 

With this, he expects new home sales to moderate to between 600 and 700 units per month. For the whole of 2020, Lee sees a total of 9,000 to 9,500 units being sold, which is slightly lower than the 9,912 units shifted last year.

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