SINGAPORE - New home sales hit a seven-month high in April, powered by strong take-up at two major city fringe projects – of which one was launched just days after a surprise round of property cooling measures took effect on April 27.
New private home sales, excluding executive condominiums (ECs), surged 80.3 per cent from 492 units in March to 887 units in April – the strongest monthly performance since September 2022 when 987 new homes were transacted.
New launches Tembusu Grand in Tanjong Katong and Blossoms by the Park in Buona Vista collectively accounted for 63 per cent of total monthly home sales in April. Of a total of 638 units, Tembusu Grand sold 354 units at a median price of $2,463 per square foot (psf), while Blossoms by the Park moved 205 of its 275 units at $2,427 psf.
Year-on-year, sales gained 34.2 per cent from 661 units in April 2022, according to data released by the Urban Redevelopment Authority on Monday.
In April, a total of 779 units were launched for sale, nearly 36 per cent higher than March 2023 and 96.2 per cent higher than a year ago.
With ECs included, April’s sales jumped 77.2 per cent to 909 units, from 513 in March, and up 7.3 per cent from 847 a year ago. There were no ECs launched in April.
The city fringe was the best performer among the submarkets in April, with Tembusu Grand and Blossoms by the Park accounting for 89 per cent or 559 units of the city fringe’s 628 units moved.
Demand for tiny units for own stay or for local investment appears firm despite the latest property curbs, as 120 or nearly 59 per cent of 205 units sold at Blossoms by the Park were below 70 sq m, OrangeTee & Tie senior vice-president of research and analytics Christine Sun said.
“The new cooling measures may not stop local buyers, especially first-timers unaffected by the higher additional buyer’s stamp duty (ABSD) rates. Some buyers even expect prices to rise further should interest rates moderate and if employment remains stable,” she added.
The new curbs included 3 to 30 percentage point hikes in ABSD rates. The steepest increase was targeted at foreigners, with ABSD rates doubling to 60 per cent from 30 per cent.
Analysts say new home sales in May could be underpinned by two more new city fringe launches – The Continuum, an 816-unit freehold condominium in Thiam Siew Avenue off Tanjong Katong Road, and The Reserve Residences, a 732-unit integrated development in Jalan Anak Bukit, which opened for preview on May 13 to close to 6,000 visitors.
So far, The Continuum has sold 216 or 27 per cent of its 816 units at an average price of $2,732 psf, analysts said.
Meanwhile, the prime district accounted for 23.4 per cent of total sales or 208 units, with The Atelier in Newton the best selling project in April, shifting 46 units at $2,658 psf. Pullman Residences Newton sold 19 units at a median price of $3,215 psf and Leedon Green moved 19 units at $2,838 psf.
Tricia Song, CBRE’s head of research for South-east Asia, noted that The Atelier moved more units as it “dangled more discounts post April 27 cooling measures”. Its median price of $2,658 psf was 8.8 per cent lower than $2,916 psf at its launch in March 2021, she said.
“Sentiment is mixed,” Ms Song said. “Downbeat macroeconomic conditions, cooling measures and elevated interest rates may deter some local and foreign investors. On the other hand, demand is still strong for realistically-priced projects with attractive location attributes.”
Huttons Asia senior director of research Lee Sze Teck said the attractiveness of Singapore’s real estate “goes beyond the (property) tax rate”.
“The chatter among some ultra high-networth individuals is whether the ABSD rate will go up further, and should they buy now or wait,” he said.
New home transactions in the suburbs plunged 78 per cent to 51 in April, due to a lack of new launches and limited unsold stock. The Botany at Dairy Farm moved 12 units at a median price of $2,087 psf, while The Gazania transacted 10 units at $1,755 psf.
Potentially easing supply tightness, a new 595-unit suburban project Lentor Hills Residences may launch in the second quarter of 2023.
PropNex Realty’s head of research and content Wong Siew Ying sees private home prices in the city fringe and suburbs staying resilient due to current tight unsold supply and demand from owner-occupiers.
The prime district, which sees more foreign investment interest, may see marginal price growth this year.
As Singaporean buyers still account for a majority of sales in the prime district, this group is expected to remain a key driver, especially with less competition from foreign buyers, JLL head of residential research, research and consultancy Chia Siew Chuin said.
The appeal of prime district properties has increased because the price gap between these properties and those in the city fringe has narrowed significantly, she added.