Developers seen to continue private housing launch momentum in 2021
AFTER topping their 2019 sales performance last year despite the pandemic-induced recession, developers are poised to continue their new project launch momentum this year.
ERA Singapore's head of research and consultancy, Nicholas Mak, said: "The launch and sales momentum are likely to continue into the first quarter of this year with the launch of major projects such as Normanton Park, Parc Central Residences and The Reef at King's Dock."
As the Covid vaccination programme is rolled out in Singapore, housing demand could increase in the second half of this year as the economy and job market improve. "At the same time, homebuyers from overseas could return to Singapore as travel restrictions are gradually eased as more people are vaccinated," he added.
JLL Singapore's senior director of research and consultancy, Ong Teck Hui, noted that for the whole of 2020, an estimated 10,883 private housing units were launched for sale - only 4.1 per cent less than in 2019 - as developers capitalised on positive market conditions to clear unsold inventory.
Urban Redevelopment Authority (URA) figures released on Friday showed that on a preliminary basis, developers sold 10,024 private housing units in 2020, surpassing the 9,912 units in 2019 by 1.1 per cent. Mr Ong described this as a "remarkable performance, taking into account that it occurred during the worst recession that Singapore recorded since independence".
"Developers are likely to capitalise on positive buyer sentiments and continue the momentum of launches this year so we may see launch volume rivalling that in 2020."
Although uncertainties remain in 2021, an expected economic recovery and the vaccination roll-out are positive factors that could augur well for the residential market, added Mr Ong. He expects developers to sell between 9,500 and 10,500 new private homes this year.
URA data also showed that last month, developers moved 1,217 new private homes in December, up 57.2 per cent from the 774 units sold in November. Year on year, the latest figure is 2.3 times the 538 units developers moved in December 2019.
Last month's top-selling project was Clavon along Clementi Avenue 1, with 473 units sold at a median price of S$1,637 per square foot, followed by Ki Residences at Brookvale, with 172 units sold at a median price of S$1,766 per square foot (psf).
On a preliminary basis, developers moved 2,645 private homes in the fourth quarter of 2020, lower than the 3,517 units in Q3 2020.
URA will release the final figures for the fourth quarter and full year 2020 in a week's time, on Jan 22.
The 1,217 units that developers moved last month is the highest number of new private residential units sold in the month of December in eight years.
PropNex's head of research, Wong Siew Ying, said: "Local buyers including HDB upgraders continued to be a key demand driver in December, as Singaporeans accounted for nearly 87 per cent of new private home sales transactions, up from about 85 per cent in the previous month, according to URA Realis data.
"We expect demand from local buyers to remain resilient this year, partly driven by HDB upgraders as the rising supply of flats attaining the five-year minimum occupation period (MOP) will enable owners to sell the flat on the resale market and upgrade to a private property."
CBRE's research manager for Singapore and South-east Asia, Goh Jia Ling, flagged some underlying risks. "Singapore's exposure towards its external environment remains uncertain, while recovery of the economy is likely to be uneven, which may weigh on job security. With the relatively healthy pipeline of launches in 2021, CBRE Research expects new home sales to fall in the region of 8,000 to 9,000 units."
