The 268-unit Sceneca Residence was the best selling new project in Jan 2023, moving 157units at a median price of $2,083 psf, and accounts for 40.2% of January’s new home sales figures.
SINGAPORE (EDGEPROP) - New private residential sales for January 2023 show a rebound as developer sales (excluding executive condos (ECs) jumped 130% m-o-m to 391 units from just 170 units sold in December 2022, according to PropNex Realty.
The majority of new units sold last month is attributed to the launch of the 268-unit Sceneca Residence at Tanah Merah Kechil Link, which was the first new project to launch this year. This project sold 157 units at a median price of $2,083 psf, and accounts for 40.2% of January’s new home sales figures.
As a result, sales in the Outside Central Region (OCR), where Sceneca Residence is located, made up 47.3% of the total number of developer sales last month. The Core Central Region (CCR) contributed 40.4% and the Rest of Central Region ended the tally with the remaining 12.3%.
“The good sales take-up shows a pent-up demand for housing units, especially in the suburbs where supply remains tight. This is despite the high interest rates and cooling measures implemented in September 2022,” says Christine Sun, senior vice president of research and analytics at OrangeTee & Tie.
Read also: December 2022 sees 170 private new homes sold, lowest since January 2009
“The healthy sales launch at Sceneca Residence in January could set the tone for major launches to come and it bodes well for new private home sales this year,” says Wong Siew Ying, head of research and content at PropNex Realty.
She adds that buyers purchasing new homes from developers under the progressive payment scheme may feel less heat from high interest rates. This is because the mortgage payment will rise gradually in tandem with the construction milestones.
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According to Lee Sze Teck, senior director of research at Huttons Asia, the relaxation of international travel by China last month saw the return of high-net-worth buyers and investors to Singapore’s property market.
“The super wealthy Chinese are behind some of the purchases in Klimt Cairnhill in January, pushing the project to become the number three bestselling project last month. Fourteen out of 17 units at Klimt Cairnhill were sold to foreigners (in January 2023),” says Lee.
The 138-unit Klimt Cairnhill, a luxury project on Cairnhill Road, was the third best-selling project by transaction volume last month. The developer, Low Keng Huat, moved 17 units at a median price of $3,784 psf.
The showflat of Klimt Cairnhill was reopened on Jan 3 after a six-week closure that involved the renovation of three showflats. Pictured is the model of Klimt Cairnhill. (Picture: Samuel Isaac Chua/The Edge Singapore)
The top spot on the list was taken by Sceneca Residence, followed by the 638-unit Leedon Green, which saw 21 units sold at a median price of $2,957 psf.
Lee says that Klimt Cairnhill was the target for most mainland Chinese buyers due to the “availability of large units which were more than 2,000 sq ft. Fifteen of the 17 units sold at Klimt Cairnhill were above 2,000 sq ft”.
He adds that this year could see the return of high-profile deals by mainland Chinese buyers, bolstered by their demand for large-sized luxury apartments.
The government unveiled an adjustment to the buyer’s stamp duty (BSD) as part of Budget 2023, introducing a more progressive tax regime. This will likely “add to the climate of tentativeness in the private residential market. This does not mean that there are no buyers”, says Leonard Tay, head of research at Knight Frank Singapore.
He believes that the knee-jerk reaction will cause most buyers to pause and re-evaluate the increased costs associated with acquiring a private home in a period of uncertainty. “However, once there are more launches (later this year) to ignite the appetite of home buyers, transaction volume will return. Home buyers in Singapore have become accustomed to the regular announcement of varied government measures and tax changes,” says Tay.
This month, the 270-unit Terra Hill in Pasir Panjang is expected to launch for sale, followed by two other projects in March — The Botany at Dairy Farm and Blossoms By The Park. Other launch-ready projects in the pipeline are Tembusu Grand and The Continuum.
Tricia Song, head of research, Southeast Asia, CBRE, also foresees a near-term slowdown in new home sales. “Demand remains uncertain in the near term amid the combination of slowing economic conditions, high mortgage rates and tightened financing conditions from September 2022’s round of cooling measures. In addition, the higher BSD announced in Singapore’s Budget 2023 could potentially undermine some home buying appetite, especially for the higher-end properties,” she says.
She expects developers and buyers to “reassess and recalibrate their buying strategies” by adopting a wait-and-see-approach over the next few months.
Check out the latest listings near Sceneca Residence, Klimt Cairnhill, Leedon Green, Terra Hill, The Botany at Dairy Farm, Blossoms By The Park, Tembusu Grand, The Continuum