Developers’ new home sales shrink to lowest for the month of August in 17 years
New home sales in August shrank 64% and are down 47% year on year
NEW private home sales slumped in August, as developers sold 208 new units during the seasonally quiet Ghost Month period, but sales are also down 47 per cent from the year-ago period.
The latest sales figure is the lowest tallied for the month of August since official records were made available in 2007, said Mogul.sg chief research officer Nicholas Mak.
The last time monthly sales for August dipped this low was in 2008, when developers sold 325 units in that month amid the Global Financial Crisis, he added.
Tricia Song, CBRE research head for South-east Asia, noted that transaction volume for new homes in 2024 is shaping up to be the weakest since 2008 when 4,264 new homes were sold, with market sentiment cautious since late-2023.
“Homebuyers’ tentative stance persisted amid weak economic conditions, high interest rates, and resistance to high price points,” she said.
Despite the decline in developers’ sales in August, the overall median transacted price of new non-landed private homes increased by 42 per cent to nearly S$2.4 million last month from about S$1.7 million in July, said Wong Siew Ying, head of research and content at PropNex.
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While the lower transaction volume could have affected prices in August, Wong noted that smaller units, which are widely available in new launches, tend to be transacted at a lower price quantum.
Caveat data showed that about 59 per cent of the non-landed new homes sold in July had a unit size of 800 sq ft or below, while only around 24 per cent of those sold in August were similarly sized, she said.
The number of private homes sold was also down about 64 per cent from the 571 sold in July, according to Urban Redevelopment Authority data released on Monday (Sep 16).
Including executive condominiums (ECs), new home sales fell almost 60 per cent from 608 units in July to 244 units in August, and were 62 per cent lower than the 649 units sold a year earlier.
In the EC segment, developers sold 36 new units in August, around the same as in July.
“There are now around 200 units of unsold new ECs on the market, and the tight supply should bode well for the next EC project that may come on later this year, that being the Novo Place EC in Plantation Close in Tengah,” Wong said.
There were 272 units released for sale in August across existing projects, a 56 per cent decrease from the 616 units in July. No new projects were launched.
The best-selling project in August was Tembusu Grand, which moved 30 units at a median price of S$2,455 per square foot (psf), followed by Hillock Green, which sold 17 units at a median price of S$2,108 psf.
Of the 208 units sold in August, almost 60 per cent or 123 units were from the Outside Central Region. Some 31 per cent or 65 units sold came from the Rest of Central Region, and the remaining 9 per cent or 20 units came from the Core Central Region.
Singaporeans accounted for about 89 per cent of buyers last month, the highest proportion since March, said Christine Sun, chief researcher and strategist at OrangeTee Group.
Only one non-landed condominium was transacted above S$10 million as demand for top-end luxury homes remained low, she added. The unit was a 4,198 square foot freehold apartment at 32 Gilstead, which sold for about S$14.7 million, or S$3,505 psf.
Transaction volume may see a slight boost in the coming months, said Lee Sze Teck, Huttons Asia’s senior director of data analytics, with the launch pipeline including 8@BT, Meyer Blue and Norwood Grand.
Analysts have adjusted their forecasts, with most estimating between 4,500 and 6,000 new homes to be sold by end-2024, compared to 6,421 units in 2023.
“Till interest rate cuts are announced, translating to lower mortgage instalments in real terms for the buyer, more of the same muted buyer response can be expected for the rest of 2024,” said Leonard Tay, Knight Frank Singapore’s head of research.
“However, not everything is bleak and there is reason to be hopeful. The likelihood of interest rate cuts is now imminent. An interest rate cut or cuts in the remainder of 2024 will create the psychological stimulus that will tip the decision-making balance for potential homebuyers who are presently sitting on the fence,” he added.
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