The Reserve Residences was the best-selling private residential project in May (Picture: Samuel Isaac Chua/The Edge Singapore)
SINGAPORE (EDGEPROP) - Developers sold 1,038 new homes excluding executive condominiums (ECs) in May, 17% higher than the 887 units sold the month before, based on data released by URA on June 15. This brings new private home sales to 3,181 units for the first five months of the year.
The May figure represents the highest new private home sales achieved since May 2022, when 1,355 new homes were sold, notes Christine Sun, senior vice president of research analytics at OrangeTee & Tie. It also marks a fifth consecutive month of growth. Including ECs, sales increased by 16% from 909 units in April to 1,055 units in May.
Sales were supported by the launch of two major projects – The Reserve Residences and The Continuum, both located in the Rest of Central Region (RCR). Boosted by these projects, developers launched a total of 1,595 units excluding ECs for sale in May, double the 798 units launched the previous month. This is the largest monthly launch since November 2021’s 1,283 units, says Chia Siew Chuin, JLL’s head of residential research, research and consultancy.
The Reserve Residences, located along Jalan Anak Bukit in District 15, had 635 out of its total of 732 units released for sale in May. It saw 523 units sold at a median price of $2,461 psf, making it the best-selling private residential project last month. The Continuum, an 816-unit freehold project at Thiam Siew Avenue, saw 225 units sold with a median price of $2,720 psf. Together, the two projects raised sales in the RCR, which clocked in at 847 units in May, representing 82% of total developer sales.
Top 10 Best-Selling Private Residential Projects (Ex. EC) in May 2023
In the Core Central Region (CCR), 152 new homes were sold by developers in May, representing 15% of developers’ total new home sales and a 26.9% fall m-o-m. Top-selling projects in the CCR include The Atelier, which moved 22 units at a median price of $2,685 psf and Pullman Residences Newton which moved 16 units at a median price of $3,278 psf.
In the Outside Central Region (OCR), new home sales totaled 39 units (4% of developers’ new home sales), underpinned by the lack of new launches and a tight supply of unsold stock. “Based on URA data, out of the mass market projects that have been launched for sale in the OCR, about 93% of the units (excluding EC) in the developments have already been sold – presenting few available options to buyers,” comments PropNex’s Wong. OCR units sold in May represent a 23.5% decline compared to the previous month.
Don't miss out to check out the hottest new launch condo and new landed property in Singapore
New private home sales in May were broadly underpinned by local demand, with Singaporean citizens and permanent residents (PRs) making up 85.5% and 11.1% of transactions respectively. Chia Siew Chuin, head of residential research, research and consultancy at JLL, notes that demand from these two groups of buyers remains robust despite cooling measures, higher home prices and elevated interest rates. “Fundamental local demand for new private homes remains sound, particularly for notable projects with attractive attributes and for launches in areas where pent-up demand continues to outstrip limited supply of new private homes,” she remarks.
In contrast, the proportion of new private homes purchased by foreigners dipped noticeably. In May, foreigners purchased 36 new non-landed private homes last month, making up 3.5% of non-landed new private home sales, compared to 8% recorded in April. PropNex's Wong notes that this is the lowest proportion chalked up by foreign buyers since December 2021.
Proportion of non-landed new private home sales (ex. EC) by residential status over the past year
Lam Chern Woon, head of research and consulting at Edmund Tie, attributes the drop to the doubling of Additional Buyer’s Stamp Duty (ABSD) for foreigners to 60%. “The punitive ABSD rates for foreigners have clearly caused many to pause in their tracks in their homebuying journey,” he comments.
Eugene Lim, key executive officer at ERA Realty Network concurs. “The CCR and RCR market, which used to see greater interest from foreign buyers, saw a discernible decrease in the number of foreign buyer transactions. The total number of units bought by foreigners declined from 38 to 21 units in CCR, and from 27 to 13 units in RCR,” he adds. At The Continuum and The Reserve Residences, the projects saw only three and five units respectively purchased by foreigners.
Lee Sze Teck, senior director of research at Huttons Asia, believes that the proportion of purchases by foreigners could further decline in the coming months. “There was a transition period in May that allowed options to purchase properties that were exercised on or before May 17 to be subject to the previous ABSD rate of 30%. Hence, the full effect of the cooling measure will be evident in June,” he explains. Huttons estimate the proportion of purchases of new homes by foreigners could fall to around 1% moving forward.
Looking ahead, PropNex’s Wong expects new private home sales to see a dip in June due to a lack of new launches, though transaction volume should rebound the following month in light of several new projects lined up. “We are anticipating the sales launch of Lentor Hills Residences and The Myst in early July, while Pinetree Hill, Grand Dunman, and Lake Garden Residence could potentially come on the market as well,” she says. Collectively, the five projects in the RCR and OCR can offer a total of more than 2,800 residential units.
Huttons’ Lee adds that Altura, an executive condominium located in Bukit Batok, is also targeted for launch in July. He anticipates a healthy demand for the project, noting that it will be the first new EC launch in Bukit Batok in 22 years.
Leonard Tay, head of research at Knight Frank Singapore, expects local demand to continue underpinning new private home demand throughout 2023 as the upcoming projects are launched. “Demand for new product will continue to be firm…so long as the price points are within the affordability levels of this type of buyer,” he opines. He adds that foreign homebuyers are likely to retain a wait-and-see posture for the time being to assess the impact of the new measures on the prime segment of the market. Knight Frank is maintaining its forecast of developers' new home sales to come in between 7,000 to 8,000 units for the full year.
Check out the latest listings near The Reserve Residences, The Continuum, The Atelier, Pullman Residences Newton