Housing market on road to recovery, say experts

Developer sales for the first eight months of this year has surpassed last year’s total sales.

Singapore’s residential market appears to be rebounding, with private home sales reaching about 8,391 units for the first eight months of this year, surpassing the 7,972 units sold for the whole of 2016, according to the Urban Redevelopment Authority’s (URA) data published last Friday (15 September).

Not only is it 60.3 percent higher than the figure recorded in the same period last year, it also exceeded the average 7,576 units transacted between 2014 and 2016, following the introduction of the Total Debt Servicing Ratio (TDSR) framework in June 2013.

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Including executive condominiums (ECs), overall home sales exceeded 11,700 units between January and August 2017. This not only translates to a growth of 42 percent year-on-year, but also outstrips the annual average of 10,285 units from 2014 to 2016.

JLL’s national director for research and consultancy Ong Teck Hui told the Business Times that private home sales would remain healthy, with people buying homes as the market nears rock-bottom.

“Overriding demand by buyers who are trying to purchase at close to the market trough will continue to keep transactions buoyant. At the current pace, we may be seeing sales of 12,000 to 13,000 private residential units by developers in 2017.”

PropNex Realty’s CEO Mohamed Ismail thinks that overall sales this year could even go beyond 16,000 units, comprising 4,000 ECs and 12,000 private units.

“Buyers are more prepared to pick up existing projects that are rightly priced, fearing that prices might increase by more than 10 percent come next year, with the recent aggressive land bids from recent land sales.”

In agreement, CBRE’s research head Desmond Sim is anticipating a “U-shaped recovery” and believes that “the current trough cannot remain at this level much longer as land is increasingly being bought at higher prices”.

Meanwhile, developers found buyers for 1,241 private homes in August, or 1,581 units if ECs are included. The top-selling project during the period was Le Quest, which accounted for 286 transacted units.

Even though August coincided with Hungry Ghost Festival, which is considered an inauspicious time to buy property, sales still surpassed those recorded in the previous three months.

Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg