The number of private non-landed homes resold hit a two-year high last month while prices firmed slightly in what observers see as another sign of the Singapore property market’s growing recovery from the effects of the Covid-19 pandemic.
An estimated 1,052 resale condominiums and apartments changed hands last month – up 7 per cent from July and 36.3 per cent higher than in August last year, according to flash figures from real estate portal SRX Property yesterday.
The previous highest volume was achieved in July 2018 – the month when property cooling measures were announced – when 1,100 units were sold.
The strong demand from HDB upgraders showed in the transactions of mass market homes in the outside central region (OCR), which accounted for nearly 60 per cent of August’s resale transactions. As in July, this group of buyers entered the private resale market in greater numbers when many flats became eligible for resale following their five-year minimum occupation period.
Ms Christine Sun, head of research and consultancy at OrangeTee & Tie, said August’s stellar resales of private homes seem to be in tandem with the positive sales trends observed in other market segments.
Last week’s SRX flash estimate for August’s HDB resale volume showed a similarly strong level of demand, with more than 2,400 HDB resale flats transacted for a third consecutive month. HDB’s Build-To-Order sales launches in a number of housing estates in August were also oversubscribed many times.
Based on the latest URA caveat data, new home sales, excluding executive condominiums, or ECs, also hit more than 1,200 units in August during the Hungry Ghost Month. This is the highest sales achieved over the last 12 months.
The strong housing demand across the different market segments indicates that Singapore’s property market could be showing some “early signs of recovery”, said Ms Sun.
Property sales plunged during the circuit breaker period when no housing viewings were allowed and all showflats were closed.
Private resales began to rebound in July with pent-up demand and HDB upgraders nearly doubled transactions to 978 units resold from 496 units in June.
Said Ms Sun: “For many Singaporeans, residential properties may still be a ‘safer bet’, especially for investors who are looking for stable returns during times of uncertainty. The market exuberance from the primary market may have also spread to the secondary market as opportunistic buyers are currently on the look-out for under-valued resale properties in the market.
“With more than 5,000 resale condos sold in the first eight months of 2020, based on SRX data, we expect total resale volume to likely reach 7,500 to 8,000 units this year – a tad lower than the 8,949 units resold in 2019, but still a very respectable number in view of the massive disruption from the pandemic,” she said.
Despite the rise in demand, resale condo prices in August remained largely stable, inching up by 0.4 per cent from July, and by the same amount over the same month last year.
Both the core central region (CCR) and rest of central region (RCR) saw a marginal resale price increase of 0.3 per cent month on month, while the OCR – which is supported by a larger pool of buyers – enjoyed a slightly higher 0.5 per cent rise.
Mr Nicholas Mak, ERA Realty’s head of research and consultancy, said the stable price index and expanding resale volume in August indicate that sellers were not cutting prices significantly to sell their properties. At the same time, some homebuyers were defying the Hungry Ghost Month, which began in the third week of August, to seal property deals.
Ms Wong Siew Ying, head of research and content at PropNex Realty, said she expects private resale prices to be relatively flat in the coming months, as the gloomy economic prospects and muted sentiment weigh on sellers’ ability to raise asking prices substantially.
In addition, buyers are likely to be cautious and prudent in their purchases, mindful of potential downside risks ahead, including the weaker hiring market, she said.