Earlier this week, URA released the developers’ sales data for November. Let's take a look at what the November numbers are telling us!
During the month, property developers sold a total of 1,168 private residential units. This comprises 1,142 non-landed condominium/apartments, 21 executive condominium units, 3 landed houses and 2 strata-landed units.
Total number of private residential units sold in November was 22.3% more than the number of units sold in October. Year-on-Year, the number of units sold in November was 3% lower from a year ago.
Excluding executive condominiums, the number of landed and non-landed private residential units sold in October was 23.6% higher Month-on-Month.
In terms of launches, a total of 740 new units were released for sale in November. During the month, there were 5 new residential launches – Sengkang Grand Residences, One Holland Village, The Iveria, Dairy Farm Residences and Pullman Residences.
3 of the new launches - One Holland Village, The Iveria and Pullman Residences are luxury developments located in the CCR. Pricing of these developments range from S$2,600 psf to S$2,900 psf on average.
One of the surprise from the November sales data was the strong sales at One Holland Village. Far East Organization sold 87 out of the 126 units released during launch, translating to an overall sales rate of 29%. We can probably attribute the strong sales to the location (proximity to MRT station) and being part of a mixed-use integrated development. Another newly launched mixed-use integrated development – Sengkang Grand Residences also achieved healthy sales despite the development being priced at premium of 20% to 30% above surrounding condominiums. This could hint that buyers generally favour mixed-use developments near MRT stations.
Buyers’ appetite and demand for residential properties have somewhat recovered gradually in 2H 2019. From July to November, developers sold a total of 6,146 units for the 5 months, averaging approximately 1,229 units per month. This is an improvement in comparison to 1H 2019, when developers sold only 4,471 units over the 6 months period and averaging 745 units per month. For the year to date, developers have sold a total of 10,617 units. With one more month to go, total unit sales for 2019 is likely to exceed the 10,848 units sold last year.
Let's look at the units sold by region.
Core Central Region – 188 units were sold in November (3% higher MoM). Similar to the previous month, the strong sales in CCR is attributable to new launches such as One Holland Village.
Rest of Central Region – 351 units were sold in November (1% lower MoM).
Outside Central Region – 629 units were sold in November (50% higher MoM). The surge is largely attributable to the launch of Sengkang Grand Residences which sold 235 units.
Supply in the pipeline
In terms of ready-to-launch inventories, there were a total of 19,926 unsold units as at November. This was a decline of 1.8% MoM. 2 new developments were added to the launch pipeline – Leedon Green (638 units in CCR) and Cairnhill 16 (39 units in CCR). The addition of new units to the launch pipeline was more than offset by the strong sales in November. Overall take-up rate in November was 158%, implying net absorption of units in the market.
CCR – 4,720 unsold units (+12.5% increase MoM)
RCR – 6,851 unsold units (-4.7% decrease MoM)
OCR – 8,355 unsold units (-6.1% decrease MoM)
In the luxury segment, the existing pipeline of 4,720 units for launch has reached the highest level since March 2016. This is expected to continue increasing, coming from the enbloc sites sold last year. On a more positive note, the pick-up in the unit sales in CCR over the past 2 months was encouraging. There is still demand for luxury properties but buyers tend to be more selective with their purchases these days.
In RCR, the supply outlook is improving. The existing pipeline for launch has declined from the recent peak of 8,354 units in June to the current 6,851 units in November. Strong take-up and demand for property in RCR helped to alleviate concerns on the supply.
For the year to date, developers sold a total of 4,233 units in RCR or averaging about 385 units per month. If demand stays firm, we can expect the inventory units to be absorbed by the market.
Outlook for the OCR properties appear to be healthy. Currently, there is a pipeline of 8,355 units in OCR that is ready for launch and for sale. For the year to date, developers sold a total of 5,340 units in OCR or averaging about 485 units per month.
At this rate, developers will take 17 months or 1.4 years to sell out their inventories. In terms of new pipeline entering into the supply, the only source of new supply will be coming from the government land sales sites. All major OCR sites sold via collective sales in the past 2 years have already been launched.
Even though the outlook for Singapore's property market seems to be improving, I would still advise my buyers to be selective and careful with their purchases. Identifying attractive opportunities and prudent financial planning are the key success factors for buyers to make the right investment.
If you would like to have a discussion with me on finding the right opportunity in today's property market, feel free to drop me a call at 9177 8871.