650 New Private Residential units sold with a decline of 58% sales from November 2021

Read more: PropNex beefed up their management team ready to seize bigger market share

Developers have sold 650 new housing units (excluding executive condos, also known as executive condos or) for the month of December in 2021. This is an increase of 58% over the 1,47 homes that were sold in November.

In addition to ECs In addition, the number of new homes sold decreased in 55.4% m-o-m, from 1,611 units sold in November up to 719 in the month of December.

In comparison to 2020, the number of sales of new units excluding ECs fell in 46.6% y-o-y from 1,217 units. Consultants believe that the decrease in sales was anticipated since Singapore’s most recent cooling measures were implemented in the month of July, on top of the fact that there were fewer projects launched in the closing quarter of this year.

The impact upon property cooling measures

As of Dec 16th on Dec 16, the stamp duty for additional buyers (ABSD) was increased along with the debt service ratio (TDSR) threshold is now a bit higher. Loan-to-value (LTV) maximum for loans made by HDB has been decreased to 90% up to%.

But, December’s home sales might not reflect the full effect of the cooling measures that affected the property market, since “a majority of transactions were completed before property curbs were put in place on the 16th of December” according to Christine Sun, senior vice director of research and analysis, OrangeTee & Tie.

“Based upon URA realis caveats that show that around 60% of the sales that involved new residences (including EC) were closed in the first part of the month. In contrast, there were 289 sales during the second halfof the month,” she says.

Leonard Tay, head of research at Knight Frank Singapore, says: “As with past announcements of measures taken by the government to curb prices in the residential housing market, there’ll be a period of pause while buyers and sellers, developers as well as investors assess the new parameters and their impact on the demand and price.”

However, the experts think that those new cool measures are not likely to discourage new homeowners or homeowners who have only one property at any given time.

“Owner-occupiers who are looking to upgrade or right-size their homes are typically not affected by the ABSD changes and will make up large proportions of purchasers by 2022.” Says Tay.

“Therefore that is why new families purchasing their first property and families that move from one house to the next – basically households that own just 1 property at any time, and which has been the primary buyer demographic over the last 18 months – these new ABSD rates could be a little less impactful,” he adds.

“The increase in ABSD rates will impact homeowners who buy second and later properties for investment and to earn recurring rental income significantly more than those who purchase their primary property for personal use. The buyers are likely to adopt an approach of waiting and watching in the near future and expect that prices will decrease,” he says.

The Rest of Central Region (RCR) was the top new home sales region by selling 292 homes. then the Outside Central Region (OCR) with 224 units as in the Core Central Region (CCR) had 134 units sold.

In the month the number of units launched was just 383 units launched, opposed to 1,283 units which were that were launched in November. The amount of new launches launched in the month also showed an increase in the range of 71.6% y-o-y, from the 1,349 units that were launched in December.

The latest projects to be launched in the month of March included Mori, Perfect Ten and Zyanya. The top-selling property in December came from Normanton Park located within the RCR area, which sold 73 units for the median price of $1831 per square foot.

“In terms of median prices for December 2021 the median price was 1.9% m-o-m increase from $2,976 to $3.033 psf was observed by newly built houses within CCR. CCR, 0.3% m-o-m increase ($1,674 to $1,679 per square foot) for OCR as well as a m o-m decrease by 1.8% ($2,221 to $2,182 per square foot) was observed for the new houses within the RCR,” says Lam Chern Woon who is the head of research and consulting at Edmund Tie.

In the near future, experts expect for the property market to recover with a strong market backed by “robust employment market, continuous economic growth and strong demand-supply dynamics within the property market” Lam. Lam.

“We believe that the slowdown on sales would be temporary. Based on historical data there was a small amount of new homes were sold over the course of about seven months following property cooling policies were introduced in July, 2018, after ABSD rates were increased as well as LTV was tightened.” according to OrangeTee and Tie’s Sun.

“During the time period, monthly average sales was 680 new homes, excluding ECs between July 2018 and February 2019, which was lower than the 964 average monthly transactions that were recorded in 2017. The demand then began to increase as the monthly average sales averaged around 995 units from March 2019 until November 2021.” Sun continues.

OrangeTee & Tie expects 8,000 to 9,000 homes to be sold over the course of 2022, based on the cooling measures and the fewer projects being launched this year.