New private home sales hit highest level in more than 11 years in November
Analysts attribute the surge in sales to pent-up demand, lower mortgage rates and the fact that five prominent private residential projects were launched last month.
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SINGAPORE: New private home sales in Singapore hit a level not seen in more than 11 years in November, spurred by pent-up demand, improved buyer sentiment and a large number of project launches.
Excluding executive condominiums (ECs), developers sold 2,557 units last month, according to data released by the Urban Redevelopment Authority on Monday (Dec 16).
This is the highest monthly developer sales figure since March 2013, when 2,793 units, excluding ECs, were sold, data from property agencies showed.
Sales increased by 246.5 per cent month-on-month from the 738 units sold in October and were also up by more than three times year-on-year – by 226.1 per cent from the 784 units sold in November 2023.
Of the 2,557 units sold last month, 98 were in the Core Central Region (CCR), 1,569 were in the Rest of Central Region (RCR) and 890 were in the Outside Central Region (OCR).
PENT-UP DEMAND, IMPROVED BUYER SENTIMENT, FIVE LAUNCHES
Ms Christine Sun, the senior vice president of research and analytics at the OrangeTee Group, said that November's surge in private home sales could be attributed to pent-up demand and improved buyer sentiment as mortgages became more affordable following the United States Federal Reserve's major interest rate cut in September.
There were also five private residential project launches, excluding ECs, last month, which is the highest number since November 2019 when six projects were launched, she added.
"Consequently, many buyers were eager to take advantage of attractive deals as several prominent projects were launched simultaneously," said Ms Sun.
Mr Mohan Sandrasegeran, the head of research and data analytics at Singapore Realtors Inc, said that the launches were strategically aligned with growing interest from buyers eager to buy a property before the year-end holiday season.
"Favourable borrowing conditions, supported by the recent easing of interest rates, further reignited buyer confidence, especially among those who had previously adopted a wait-and-see approach earlier in the year," said Mr Sandrasegeran.
The projects launched in November include Emerald of Katong, Chuan Park and Nava Grove.
Emerald of Katong, in particular, proved popular with buyers, selling 840 – or 99.3 per cent – of its 846 units last month at a median price of S$2,627 (US$1,948) psf.
"Buyers were drawn to the project's excellent design and offerings, particularly those wishing to live near the East Coast," said Ms Sun.
Meanwhile, Chuan Park, a project located on Lorong Chuan, sold 721 of its 916 units at a median price of S$2,586 psf, making it the next-best-performing project.
Its appeal lay in its "family-friendly environment, competitive pricing and proximity to established connectivity and amenities", said Mr Sandrasegeran.
"The standout performances of Chuan Park and Emerald of Katong highlight the enduring appeal of large-scale projects that provide comprehensive facilities and cater to diverse buyer profiles," he added.
"With their combination of attractive locations, thoughtfully designed layouts and competitive pricing, these developments captured the attention of buyers, including upgraders and investors seeking long-term value."
Mr Sandrasegeran also said that the 2,557 units sold this month exceeded the total units sold in any quarter since the fourth quarter of 2021, when 3,018 units were sold.
"This highlights the sheer scale of November's success, underscoring the pent-up demand and market resilience that fuelled the ... sales," he said.
OUTLOOK
Noting that new home demand has been subdued throughout 2024 largely from a lack of significant private project launches, Ms Sun said: "The recent surge in sales appears to be a temporary phenomenon rather than an indication of an overheated market."
She expects there to be more private condominium and EC launches in the next few years due to the government's "consistent" provision of land for residential development.
"For instance, the Government Land Sales Programme in (the first half of) 2025 is likely to generate approximately 5,030 private housing units, including 980 EC units," she said.
"The supply increase can help mitigate abrupt fluctuations in demand by providing prospective buyers the opportunity to assess their options prior to committing to a private property investment. This can help improve market stability in the long term."
Mr Sandrasegeran said he expects new home sales to regain momentum in January 2025 after slowing this month, driven by the highly anticipated launch of The Orie in Toa Payoh.
"The Lorong 1 Toa Payoh area has not seen a new property launch since Gem Residences in 2016, and this extended gap is likely to generate pent-up demand, continuing buyer enthusiasm for this well-established estate which is closely situated to Braddell MRT station," he said.
Huttons Asia's senior director of data analytics Lee Sze Teck expects that private home sales in December will be lower at about 200 to 250 units, as there are no launches planned for the month due to the school holidays.
He said that Huttons is "cautiously optimistic" of a better performance in the market next year as some of the unsatiated demand this year may flow over to the launches in the first quarter of 2025.
