Singapore home sales recover in July with more developer supply
By Low De Wei
(Bloomberg) — Singapore’s new-home sales in July rose to the highest level since March, recovering from its weakest first half on record.
Developers in the city-state sold 571 units last month, more than double the 228 sold in June, according to figures released by the Urban Redevelopment Authority Thursday. Still, that’s only about 40% of the number sold in the same period last year.
July typically sees a seasonal increase for sales, coming on the tail end of a months-long school holiday in June. Two new suburban projects released on the market also helped. Local developers are expecting sentiment to recover in the second half, anticipating that interest rates will come down.
The rebound is still lagging behind the sales numbers seen in past years, said Nicholas Mak, the chief research officer at Mogul.sg, a property portal. “It’s an improvement over the preceding three months, but that’s mainly due to new launches,” he said.
Developers will continue to pace themselves on releasing new projects and interest rate decreases are “not going to move the needle a lot on property demand,” he said, noting that local banks have already rolled out lower promotional mortgage rates.
City Developments Ltd. chief executive officer Sherman Kwek said during a earnings briefing on Wednesday that developers are unlikely to keep holding on to stock, a factor that’s contributed to the sales slowdown in the first half. He pointed to a government penalty for developers if they don’t sell their projects within five years.
Authorities eased that penalty earlier this year, in an acknowledgment of the market slowdown. The government is still trying to ramp up private housing supply as it grapples with voter concerns about housing affordability and rising private home prices.
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