Demand falling for Singapore residential properties

July 19, 2012 / By  

The latest data from the Urban Redevelopment Authority shows that demand for new residential properties has fallen for the second consecutive month. Sales volume for private residential units, excluding executive condominiums, fell by 20% m-o-m in June 2012 to 1,371 units, bringing the total for 1H12 to 12,254 units. This is some 48% above the total sales in 1H11 and already approaching the 2011 total of 16,369 units following the bumper take-up between February and April 2012 when sales averaged in excess of 2,400 units per month.

The Outside Central Region (OCR) continues to perform well with total sales in June remaining above 1,000 units at 1,111, a decrease of 8% m-o-m. The number of units launched remained flat, with just three more units launched in June than in May, a total of 1,138. As a result, the take-up rate was close to 100% with 98% of all units launched being sold. There were three new non-landed projects launched in June, Tropika East (105 units), Sea Esta (376 units) and River Isles (442 units). These projects all achieved sales of more than 50% in the month, with Sea Esta showing the strongest performance with 68% of units sold. Elsewhere, buyers continue to soak up supply from previous launches, with several projects continuing to sell units without any launches this month.

The Core Central Region (CCR) was the only region to enjoy an increase in sales volume in June, as the launch of 1919 at Mount Sophia proved popular with buyers and 74 of the 75 units at the development were sold at a median price of SGD 2,042 per sq ft. Overall, 141 units were sold, an increase of 4% m-o-m, with the sales at 1919 making up 52% of this. Sales also remained steady at previously launched projects including The Trizon and EON Shenton which are now 88% and 85% sold, respectively. Launches however fell steeply in the CCR in June, down by 70% m-o-m to 94 units translating to a healthy take-up rate of 150%, helping to soak up some of the excess supply in this region.

The Rest of Central Region (RCR) saw steep falls in both the number of units launched and sold in June 2012, falling by 93% m-o-m to 71 units and 67% to 119 units respectively. This reflects the highest take-up rate of all three regions in June at 168%. There was only one new launch in the RCR in June, namely M66, where 70 units were launched, with the remaining addition a single unit at Ascentia Sky. Only 10 units were sold at M66, with previously launched projects proving more popular with buyers.

Previous policy intervention is now starting to work its way through the market and buyers are returning, especially to the CCR, as landlords become more flexible on pricing and the price gap between the CCR and OCR narrows generating more buying interest. Singaporeans are increasingly supporting sales volume in this region, helping to soak up the unsold inventory.

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