Developers have sold 657 units in the month of September 2017. This is 148 units or 29 per cent more than September last year 2016 where 509 private residential properties were sold.
According to Urban Redevelopment Authority (URA) data released, new residential homes sold in September was lower than the 1246 units of the month of August. This slower sales is mainly due to the Hungry Ghost Month effect as many home buyers prefer to postpone their purchases.
Raising 62.9 per cent to 9,582 from 5,883 in the same period of 2016, the takeup of new homes excluding ECs for the nine months of 2017 has been robust.
Among the top selling private residential project was Chinese developer Kingsford’s Kingsford Waterbay. This development along Upper Serangoon sold 45 units at a median price of S$1289 per square feet.
Parc Life at Sembawang Crescent is the top selling EC project last month where the developer sold 48 units at a median price of S$795 per square feet. This EC development is situated near Sembawang MRT and is expected to complete in 2018.
Many property analyst expects the property market to recover as transaction volumes pick ups. Total sales of new private homes and ECs were up 42.9 percent from September last year.
As more condominiums prepare for enblocs through setting up of their respective committees, many potential home buyers are out in the market in search of their ideal home and profitable property investment.
Interest on real estate are likely to heat up in the final quarter of 2017 and the developers have positioning their current unsold inventory in a favourable position through extensive marketing efforts.
The recent trend of en-bloc sales or redevelopment deals in which owners in an development collectively agreed to sell apartment blocks at a hefty premium, has vastly improved market sentiment. This would likely cause the stocks of Singapore property developers to rise.
Singapore property prices have reversed its declining trend in 3rd Quarter 2017. Official flash estimates shows that the private residential prices have risen 0.5 percent for a quarter-on-quarter. This is the 1st time in four years of decline that the prices have increased.
Many property analysts are expecting the prices to increase between 0-1 percent in 2017 and a further of 4 to 8 percent increase in 2018. But some caution that it may be too early to call this a market rebound as more data are required.
Healthy demand in the recent en bloc markets by property developers and strong land biddings on government land sales by developers have pointed towards a recovering market. The increase in transaction volumes in developer sales and resale transactions when compared to the same period last year was 57.5 percent and 42.8 percent higher.
OCBC and Morgan Stanley expected the first price upturn since 2013 in the third quarter of this year. OCBC Investment Research commented that “the bottom is actually behind us” while a 0.8 percent quarter-on-quarter rise was expected by the analysts at Morgan Stanley.
The overall unsold inventory of developer units has also reduced in 2017. Several new developments have also increased their selling prices to take advantage of this improved market sentiment.
The Government of Singapore has reiterated in early 2017 that property cooling measures are unlikely to be lifted in the near term despite numerous calls from property developers. In March 2017, the seller stamp duty was slightly adjusted to reduce the selling taxes which helped buyer optimism and purchasing activities. Monetary of Singapore (MAS) have also adjusted regulations on loans to allow easier refinancing.
Despite the strong positive outlook, double-digit growth in prices is not expected to happen as the Total Debt Servicing Ratio (TDSR) framework continues to limit excessive borrowing. Moreover, a gradual increase in prices, coupled with positive economic growth will reduce the risk on the formation of a property price bubble in Singapore.
Official statistics will be released on 27 October 2017.