Private New Home Sales Receded By 64% In June On Dearth Of New Launches; High-end Home Sales Continue To Shine

Private New Home Sales Receded By 64% In June On Dearth Of New Launches; High-end Home Sales Continue To Shine

Kumar Properties

Private New Home Sales Receded By 64% In June On Dearth Of New Launches; High-end Home Sales Continue To Shine

Private new home sales fell sharply in June as the lack of fresh project launches drove a 64% decline in transactions from May to June. Developers sold 488 new private homes (ex. Executive Condos) in June, declining from the robust 1,355 units transacted in the previous month, where new projects Piccadilly Grand and Liv @ MB spurred take-up. On a year-on-year basis, sales also came in lower, easing by 44% from June 2021.

June’s transaction numbers take the Q2 2022 new home sales to 2,504 units (ex ECs), which represents a 37.2% increase from the previous quarter. In the first half of 2022, developers sold an estimated 4,329 new homes.

URA NEW HOMES JUNE 2022 TABLE 1

The Core Central Region (CCR) led new private home sales in June, with 206 transactions – down by 4.2% from May. The top performing CCR projects in June were Haus on Handy which sold 21 units at a median price of $2,654 psf, Leedon Green which transacted 20 units at a median price of $2,843 psf, and Irwell Hill Residences which shifted 19 units at a median price of $2,876 psf.

Due to the lack of fresh projects, new home sales in the Rest of Central Region (RCR) in June fell markedly by 81% MOM to 171 units from the high base of 893 units in May, where the launch of Piccadilly Grand and Liv @ MB helped to supercharge sales in the sub-market. The best-selling RCR projects during the month were Riviere which sold 25 units at a median price of $2,856 psf, and Normanton Park which moved 21 units at a median price of $1,864 psf.

Meanwhile, just 111 new homes were sold in June in the Outside Central Region (OCR) amid depleting unsold inventory – sales were down by 55% from the previous month. The top sellers in the OCR in June were The Florence Residences which sold 20 units at a median price of $1,746 psf and The Watergardens at Canberra where 16 units were transacted at a median price of $1,463 psf.

In the EC segment, 8 new units were sold in June, posting a 60% fall from 20 transactions in May. The best-selling EC project in May was North Gaia EC, where 5 units changed hands at a median price of $1,303 psf.

Developers placed 397 new units (ex. ECs) for sale in June compared to the 1,240 units that were put on the market in May. In Q2 2022, developers launched an estimated 2,034 new private homes for sale.

Ms Wong Siew Ying, Head of Research & Content, PropNex Realty:

“The wane in new home sales in June as well as the magnitude of decline were expected, given that there were no fresh projects put up for sale during the month and considering the new-launches fuelled surge in sales in May. In addition, the resumption of international travel and the June holidays – where families tend to go on vacation abroad – may also have contributed to the slower market activities.

Generally, June’s sales performance did not detract much from the general narrative. That being, the lack of launches and dwindling unsold stock in the OCR continuing to weigh on the mass market sales volume, and that some buyers are finding CCR projects increasingly compelling, as the average transacted unit price ($PSF) gap continued to narrow between new private home sales in CCR and the RCR to 16.1% in June, compared to 21.4% in May (see Table 1).

Meanwhile, URA Realis caveat data showed that foreigners bought 11.7% of the new private homes (see Chart 1) sold in June – mainly in the CCR and RCR– rising from 6% in the previous month. Singaporeans accounted for nearly 76% of new home sales in June and we expect this number to rise in the coming months, as more mass-market projects are launched.

With the launch of AMO Residence on 23 July, we anticipate that new home sales this month should outperform that of June. In addition, some buyers may want to get transactions done before the Hungry Ghost month starts at the end of July.”

Ms Wong Siew Ying, Head of Research & Content, PropNex Realty: “The wane in new home sales in June as well as the magnitude of decline were expected, given that there were no fresh projects put up for sale during the month and considering the new-launches fuelled surge in sales in May. In addition, the resumption of international travel and the June holidays – where families tend to go on vacation abroad – may also have contributed to the slower market activities.  Generally, June’s sales performance did not detract much from the general narrative. That being, the lack of launches and dwindling unsold stock in the OCR continuing to weigh on the mass market sales volume, and that some buyers are finding CCR projects increasingly compelling, as the average transacted unit price ($PSF) gap continued to narrow between new private home sales in CCR and the RCR to 16.1% in June, compared to 21.4% in May (see Table 1).  Meanwhile, URA Realis caveat data showed that foreigners bought 11.7% of the new private homes (see Chart 1) sold in June – mainly in the CCR and RCR– rising from 6% in the previous month. Singaporeans accounted for nearly 76% of new home sales in June and we expect this number to rise in the coming months, as more mass-market projects are launched.  With the launch of AMO Residence on 23 July, we anticipate that new home sales this month should outperform that of June. In addition, some buyers may want to get transactions done before the Hungry Ghost month starts at the end of July.”
URA NEW HOMES JUNE 2022 TABLE 3

This is the news article from Propnex

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6,000 HDB flats to be built in Greater Southern Waterfront, first BTO project within 3 years

6,000 HDB flats to be built in Greater Southern Waterfront, first BTO project within 3 years

Kumar Properties

6,000 HDB flats to be built in Greater Southern Waterfront, first BTO project within 3 years

Around 6,000 Housing Board flats will be built on the Keppel Club site in the Greater Southern Waterfront (GSW), with the first Build-To-Order (BTO) project to be launched for sale within three years. These units are part of the 9,000 homes that will be built on the 48ha site, which will offer unique waterfront living that is close to nature, announced National Development Minister Desmond Lee on Tuesday (April 12).

The remaining 3,000 units are expected to be private housing. A mix of public and private housing developments will be progressively scheduled for launch in the next three to five years, said the Urban Redevelopment Authority (URA). The 48ha site at Keppel Club – about half the size of Bidadari estate – comes under the mature town of Bukit Merah and is bounded by Telok Blangah Road, Berlayer Creek and Bukit Chermin. It has been earmarked for residential use in the URA Master Plan since 2014.

Mr Lee said: “Given its central location and the two MRT stations nearby, we will seek to keep the estate car-lite and enable residents to get around easily by walking or cycling.”

Future residents will be served by Labrador Park and Telok Blangah MRT stations on the Circle Line, which will be connected to the estate via walking trails. Within the site, close to 10ha – about 20 per cent of the site area and the size of about 18 football fields – will be set aside as parks and open land. This includes four green corridors that will run through the estate and serve as recreational spaces – the Central corridor, Berlayer Corridor, Henderson Corridor and the Northern Corridor.

Mr Lee said the plans are guided by recommendations from an environmental impact study (EIS) and feedback from nature groups. These may be fine-tuned after public consultation on the EIS report. Housing blocks will be designed with staggered building heights which step down towards the green spaces, to give residents the view of greenery at their doorstep, HDB said. They will also feature skyrise greenery and landscaped terraces.

Green roofs on lower-rise blocks will serve as additional habitats for butterflies and smaller urban bird species such as the locally endangered blue-crowned hanging parrot and oriental magpie-robin. “As the site is quite close to the city centre, we will bring homes closer to jobs. This is part of our effort to move towards having more housing options and mixed-use development in our central region,” said Mr Lee.

All development works will be confined within the brownfield site of Keppel Club, he added. Brownfield sites are land that had previous developments on them.

When the lease of the golf course runs out, the authorities will redevelop the land for housing, said Mr Lee. A Singapore Land Authority spokesman said the lease for the existing golf course site expires June 30. The existing clubhouse has until March 31 next year to clear and reinstate the site.

Mr Lee added that there are also plans to transform the former Pasir Panjang Power Station buildings into a distinctive and vibrant mixed-use district characterised by its unique industrial heritage and waterfront location. On whether the BTO projects in the Keppel Club site will fall under the prime location public housing (PLH) model, HDB said the model will be applied to selected public housing projects in prime and central locations such as the city centre and surrounding areas, including the GSW. These are areas that have very high market values and would require significant additional subsidies to keep flats affordable, said HDB.

While the Keppel Club site is within the GSW, the authorities will consider a range of factors – such as the project’s location, attributes and market values – before deciding whether to apply the PLH model, it added. Owners of flats under the PLH model are subject to stricter buyer and selling conditions, including a 10-year minimum occupation period and having the additional subsidy clawed back by the Government should they sell the units.

Mr Lee said HDB is building more homes to cater to the strong demand for housing from echo boomers – children of the baby boomer generation – and the increasing societal trend of having smaller households.

When launched, the BTO project will kick-start the transformation of the GSW into a mega waterfront development along Singapore’s southern coast. It is expected to draw strong interest, based on previous BTO launches in the area.

The Telok Blangah Beacon BTO project launched in May 2021 saw more than 23.3 applicants vying for each available unit – one of the highest rates in recent years. First announced in 2013, the the GSW comprises 30km of coastline stretching from the Gardens by the Bay East area to Pasir Panjang. It contains 2,000ha of land – six times the size of Marina Bay and twice the size of Punggol.

This is the news article from The Straits times

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How to Identify Right Property at the Right Price Tag?

How to Identify Right Property at the Right Price Tag?

Kumar Properties

how to identify the right property at the right price tag?

I will be sharing with you on some investment tips that you must take note of when buying a property. How to determine freehold property with the right price tag? And how to determine the exit strategy? What should be the exit price for your property?
 
How do I determine which property to select? I have always stand by my Number 1 Rule – to look for the Correct Entry Price. Let me share with you in detail by using a Jervois Mansion as a case study. This project happens to be a FH located at a super good location, near to MRT station and Orchard Road.

ENTRY PRICE

How are we going to determine the
POTENTIAL UPSIDE
and
RISK
of buying this property?

With reference from the above chart, we can see that the existing resale properties that are near to this development are already transacted between $25xxpsf to $27xxpsf on average. Being a brand-new development, the price of Jervois Mansion is starting from $22xxpsf. Do you think is there a potential? Or is it risky? Will you consider to buy based on this?
 
Important to take note: Before any purchase, remember to remind yourself that the price has to be what others are willing to pay. If you are buying way above (for instance) more than $3xxx psf, you might consider to do more research.
Look at the above research, the other 99 years LH in this vicinity are already transacted above $23xxpsf to even $27xx psf. This will provide an assurance to yourself. Referring to the bar chart below, the existing FH new launches are also transacting above $26xxpsf to even $36xxpsf. This will provide further assurance to this purchase.

EXIT STRATEGY

How do I determine my exit? Based on this entry price, if I am adding $300,000 profit into the purchase price, how much should be my exit psf?

The table above shows that after adding the profit, the selling price will be $2507psf.  The question you need to ask now is, do you think this price is acceptable for the future new buyer after 3 years when you can sell?

CCR Average Transacted Price

Let’s take a further look at this chart below. The average transaction price in the Core Central Region (CCR) is $2704psf for all the new launches. Given this comparison, we are confident that Jervois Mansion is priced rightly and there is potential upside. Most importantly, the risk is very low. At the end day, the investment has to be safe with future upside.
After reading so much, do you agree with me that this is a property that is priced rightly for safe entry? Not only that, it is FH with good location, right in the town. With sufficient research, we can invest in Right Entry Price property.
 
Hope you have enjoyed the article on how I determine the right entry price property. If you are keen to further explore for other similar property in the market, drop me a WhatsApp so that we can meet up for a further discussion.
 
As this is a million-dollar investment, I hope you can understand that my strategies are not fully explained via an article. There is no obligation at all. It is always my pleasure to share my knowledge with you. Thank you for reading my article.

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