Singapore new private home sales surge 77% to 1,545 units in July

NEW private home sales in July rallied in spite of tightened community measures in the second half of the month. 

Updated from : The Business Times, 13 Aug 2021

NEW private home sales in July rallied in spite of tightened community measures in the second half of the month. Riding the pent-up demand wave, developers also enjoyed ripple effects from the launch of Pasir Ris 8.

Based on caveats lodged, analysts estimated that developers in Singapore sold 1,545 new private homes in July, jumping 77.2 per cent from June’s 872.

Mark Yip, chief executive officer of Huttons Asia, noted that this is the second highest monthly sale in 2021 so far, just 5.4 per cent behind that of January. He also highlighted that January had two major launches, compared to one in July.

With a median price of S$1,624 per square foot (psf), the month’s sole major launch, Pasir Ris 8, made up 27 per cent of July’s total new home sales. It was also the best-selling project for the month.

“The successful launch of Pasir Ris 8 has a galvanising effect on other integrated projects and projects in the vicinity,” said Mr Yip.

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Nicholas Mak, head of research and consultancy at ERA, added that the project’s price increases later in the month turned buyers towards other developments in search of more affordable alternatives.

“After the price increase in Pasir Ris 8, the sales in Normanton Park, Midwood, Sengkang Grand Residences and Ki Residences increased significantly on a basis of units sold per day,” he said.

For example, Mr Mak noted that Sengkang Grand Residences sold 31 units between July 1 to July 23. However, the integrated development sold 58 homes in the remaining eight days of the month after Pasir Ris 8 raised its prices on July 24.

“This shows that some homebuyers are price sensitive and would substitute a project at one location for another project at another location, especially if they are investors,” said Mr Mak.

He also told BT that the rising prices could lead to a “fear of missing out” (FOMO) among purchasers.

Christine Sun, senior vice-president of research and analytics at OrangeTee & Tie, added: “Sales picked up across many projects last month as buyers returned to the private residential market in droves. Some rushed to buy units for fear of being priced out of the market as prices seemed to have bottomed out, and Singapore’s economy is poised for further recovery in the coming months.”

During the month, Normanton Park sold 124 units at a median price of S$1,824, making it a distant second among the month’s top selling projects. Midwood came in third with 91 units sold at a median price of S$1,656.

Comparing year on year, the estimates are 42.7 per cent higher than the 1,083 new private homes sold in July 2020.

Including executive condominiums (ECs), which are public-private housing hybrids, the tally reached 1,700 units, up 76.7 per cent from sales in the previous month and 48.5 per cent from that of July last year.

Mr Yip said: “In the first seven months of 2021, developers have sold an estimated 8,004 units. Despite the lunar seventh month in August, developers are likely to push ahead with their launch to ride on the positive momentum. Barring unforeseen circumstances, new sales could possibly hit a high of 12,000 units in 2021.”

In terms of price, homes in the S$1-1.5 million range led the month by making up 39 per cent of transactions, excluding ECs. Some 28.9 per cent of homes cost S$1.5-2 million, while 17.5 per cent of transactions were for new homes in the S$2-3 million bracket.

The outside central region continued to lead new home sales, excluding ECs, in July.

Including Pasir Ris 8, the section made up 65.2 per cent of last month’s sales.

Meanwhile, the rest of central region and core central region accounted for 25.8 per cent and 9 per cent respectively, data from OrangeTee & Tie showed.