News: New private homes sales spiked 75.5% in May

Jun 16, 2020

Including ECs, 509 units were sold in May, up 73.7% month-on-month but down 46.5% year-on-year. Photo: Treasure at Tampines.

Despite the closure of showflats due to the government’s circuit breaker measures, sales for new private homes rose 75.5% to 486 units – excluding executive condominiums (ECs) – in May from 277 units in April, showed Urban Redevelopment Authority (URA) data.

On an annual basis, developers’ sales, excluding ECs, fell 48.9% from the 952 units transacted in May 2019.

Including ECs, 509 units were sold in May, up 73.7% month-on-month but down 46.5% year-on-year.

No new project was launched in May since the circuit breaker was in force during the whole month. However, “electrifying deals” still flowed from previously launched projects, such as Treasure at Tampines, Parc Clematis and The Florence Residences, said Desmond Sim, Head of Research for Southeast Asia at CBRE.

Treasure at Tampines emerged as the best-selling project in May with 56 units, followed by Parc Clematis and The Florence Residences, which moved 55 units and 54 units respectively.

Related story: Private Home Sales Up 75.5% in May 2020—See The Top 5 Condos Sold Here

Tricia Song, Head of Research for Singapore at Colliers International, attributed this to buyers having been familiar with such projects as they may have previously visited them before the circuit breaker measures, or the projects may have recorded sufficient sales to inspire confidence.

OrangeTee noted that the “unexpected sizzling sales” in May appeared to be mainly driven by locals and investors.

Citing URA realis data, OrangeTee revealed that the proportion of non-landed new homes acquired by Singaporeans rose to 84.8% in May from 84.1% in April. In absolute figures, the number of non-landed homes purchased by Singaporeans jumped 81.1% to 402 units in May from 222 units in April.

“Foreigner purchases had similarly strengthened last month as the number of non-landed new homes bought by permanent residents (PRs) and non-permanent residents (non-PRs) surged 71.4% from 42 units in April to 72 units in May,” said Christine Sun, Head of Research & Consultancy at OrangeTee.

She added that more investors entered the market in May as sales of lower-priced or smaller units – which tend to be popular among investors – increased during the period under review.

“Last month, the number of smaller units (excluding EC) below 800 sq ft rose by a whopping 70.0% to 319 units in May from 188 units in April. On a similar note, the proportion of private home sales excluding EC below $1 million increased from 23.6% in April to 28.7% in May, which was the highest proportion recorded since August 2019 (29.6%).”

Some investors may have also made the purchase for ‘fear of losing a good deal’ as they expect prices to recover given that the Covid-19 outbreak is abating in some countries while many major economies are gradually reopening, said OrangeTee.

Looking ahead, Sim expects new home sales for this year to drop between 4,000 and 5,000 units, excluding ECs.

Song, on the other hand, expects developer sales to decline 29% to 7,000 units this year from 2019’s 9,912 units. She also expects developers to cut prices by 3% to 5%.

 

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Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg

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