18-01-2011, 07:59 AM
Jan 18, 2011
December home sales lower but still strong
By Esther Teo
SALES of new private homes last month fell some 30 per cent from the previous month, but still remained buoyant.
The attractions of low interest rates, ample liquidity and strong economic growth continued to entice buyers as they have all year, leading to sales of 1,332 new private units last month, data from the Urban Redevelopment Authority shows.
This is about a third lower than November's tally of 1,915 units.
December's sales helped propel total sales for the year to a record 16,364 - and likely played a part in last week's surprise cooling measures in the process.
That unprecedented annual number - where suburban homes dominated in sales activity - is well ahead of the old benchmark of 14,811 set in 2007. Factor in executive condo sales from last year and the number is an even more striking 17,438 units.
Last month's figure was strong given that December is traditionally a slow month, when people think more about the festivities than buying a home.
Compare that bumper number with December 2009, when only 481 units were sold. In fact, the average December sales figure from 2007 to 2009 is only 313 units.
Experts put the sales boom down to buyers deciding to enter the market again after a wait-and-see period following the August cooling measures.
That points to another period of declining sales now, given the stringent measures imposed last week: Seller's stamp duty could be as much as 16 per cent on some sales, while buyers with existing mortgages will have to stump up more cash upfront on a second home.
Experts say the continued strength of sales last month was probably a factor in last week's measures.
'We normally see a dip in the number of transactions at the year end,' said PropNex chief executive Mohamed Ismail. 'And it is probably this surprisingly hot (fourth quarter) that has prompted the Government to announce further cooling measures.'
Mr Ismail expects about 1,000 units to be sold this month and 'much less' in February and March, as buyers with a short-term view are dissuaded from taking the plunge.
Mr Colin Tan, research and consultancy director of Chesterton Suntec International, said the main impact of the new measures would be psychological, dampening buying sentiment as many people were caught by surprise.
'We might see about 500 units sold this month as sales fall in a knee-jerk fashion, although the numbers might pick up again in a few months... I think we are underestimating the liquidity problem,' he added.
Experts also say that major price gains will be curtailed for now as buyers adjust to the tougher-than-expected new rules.
Mr Png Poh Soon, head of research and consultancy at Knight Frank, expects sales numbers this quarter to shrink and prices to ease after sharp increases last year.
'Buyers' and sellers' sentiments are likely to be affected by the latest set of measures, causing prices to fall, in particular the mass market segment...(which is) likely to fall by up to 5 per cent quarter-on-quarter.'
However, he does not expect the overall market to correct drastically, with the high-end segment to be the least affected, with prices likely flat or increasing by less than 3 per cent this quarter.
Last month's numbers also gave early signs of a pick-up in investor confidence in homes in the city centre, where price gains have lagged behind the city fringe and suburban areas.
Colliers International director of research and advisory Tay Huey Ying said 75 private apartments were transacted at above the $3,000 per sq ft level last month, many of them in the city centre. There were only 11 such units sold in November.
That is the highest number of deals closing above $3,000 psf since December 2007, she added.
Top-selling projects last month include The Tennery, which sold 220 units at a median price of $1,118 psf; d'Leedon, which found buyers for 180 apartments at a median of $1,540 psf; and Robinson Suites, where 157 units moved at a median of $2,941 psf.
If executive condos are included, Prive at Punggol Road was the top-selling project, with 326 units sold at a median price of $704 psf.
esthert@sph.com.sg
December home sales lower but still strong
By Esther Teo
SALES of new private homes last month fell some 30 per cent from the previous month, but still remained buoyant.
The attractions of low interest rates, ample liquidity and strong economic growth continued to entice buyers as they have all year, leading to sales of 1,332 new private units last month, data from the Urban Redevelopment Authority shows.
This is about a third lower than November's tally of 1,915 units.
December's sales helped propel total sales for the year to a record 16,364 - and likely played a part in last week's surprise cooling measures in the process.
That unprecedented annual number - where suburban homes dominated in sales activity - is well ahead of the old benchmark of 14,811 set in 2007. Factor in executive condo sales from last year and the number is an even more striking 17,438 units.
Last month's figure was strong given that December is traditionally a slow month, when people think more about the festivities than buying a home.
Compare that bumper number with December 2009, when only 481 units were sold. In fact, the average December sales figure from 2007 to 2009 is only 313 units.
Experts put the sales boom down to buyers deciding to enter the market again after a wait-and-see period following the August cooling measures.
That points to another period of declining sales now, given the stringent measures imposed last week: Seller's stamp duty could be as much as 16 per cent on some sales, while buyers with existing mortgages will have to stump up more cash upfront on a second home.
Experts say the continued strength of sales last month was probably a factor in last week's measures.
'We normally see a dip in the number of transactions at the year end,' said PropNex chief executive Mohamed Ismail. 'And it is probably this surprisingly hot (fourth quarter) that has prompted the Government to announce further cooling measures.'
Mr Ismail expects about 1,000 units to be sold this month and 'much less' in February and March, as buyers with a short-term view are dissuaded from taking the plunge.
Mr Colin Tan, research and consultancy director of Chesterton Suntec International, said the main impact of the new measures would be psychological, dampening buying sentiment as many people were caught by surprise.
'We might see about 500 units sold this month as sales fall in a knee-jerk fashion, although the numbers might pick up again in a few months... I think we are underestimating the liquidity problem,' he added.
Experts also say that major price gains will be curtailed for now as buyers adjust to the tougher-than-expected new rules.
Mr Png Poh Soon, head of research and consultancy at Knight Frank, expects sales numbers this quarter to shrink and prices to ease after sharp increases last year.
'Buyers' and sellers' sentiments are likely to be affected by the latest set of measures, causing prices to fall, in particular the mass market segment...(which is) likely to fall by up to 5 per cent quarter-on-quarter.'
However, he does not expect the overall market to correct drastically, with the high-end segment to be the least affected, with prices likely flat or increasing by less than 3 per cent this quarter.
Last month's numbers also gave early signs of a pick-up in investor confidence in homes in the city centre, where price gains have lagged behind the city fringe and suburban areas.
Colliers International director of research and advisory Tay Huey Ying said 75 private apartments were transacted at above the $3,000 per sq ft level last month, many of them in the city centre. There were only 11 such units sold in November.
That is the highest number of deals closing above $3,000 psf since December 2007, she added.
Top-selling projects last month include The Tennery, which sold 220 units at a median price of $1,118 psf; d'Leedon, which found buyers for 180 apartments at a median of $1,540 psf; and Robinson Suites, where 157 units moved at a median of $2,941 psf.
If executive condos are included, Prive at Punggol Road was the top-selling project, with 326 units sold at a median price of $704 psf.
esthert@sph.com.sg