Executive condominiums (ECs) turned out to be best selling projects in August amid a lack of new residential project launches, with developers’ sales of ECs this year already surpassing that for the whole of last year.

Last month, ECs took up 41 per cent of the total 805 residential units sold by developers in August. Excluding ECs, some 473 private residential units were sold by developers in August, down 8 per cent from the 513 units sold in August last year. This represented a 57 per cent plunge from the active month of July, though the number of units launched (590 units) in August was only 5 per cent fewer than in July.

Mass-market homes led the sales, making up 60 per cent of private homes sold.

The numbers were collated by the Urban Redevelopment Authority (URA) through a developers’ survey.

The subdued sales by developers in August is partly due to the absence of new projects being launched and is not a clear indicator of where the market is heading, said an analyst .

The tepid sales coincided with the Hungry Ghost Festival, which is deemed by many as an inauspicious time to make home purchases. There is also an inertia to commit as buyers remain on the sidelines due to ongoing measures and an anticipation of further price declines.

Based on monthly developer sales data from URA, sales from existing launches have increased by about 21.7 per cent in the first eight months this year compared to the same period last year. Furthermore, prices have remained resilient. This lends strength to the proposition that the primary market may have bottomed and is in recovery.

For the first eight months of this year, developers sold an estimated 3,029 EC units, already exceeding the 2,550 EC units sold in the whole of 2015 – though the number of EC units launched so far this year (2,656 EC units) was lower than the 3,750 EC units launched for the whole of last year.

ERA Realty key executive officer Eugene Lim noted that ECs continue to find favour with buyers, possibly due to their lower prices and slightly more spacious sizes.

The top three sellers in August were EC projects. Sim Lian’s Treasure Crest in Sengkang sold another 56 units in August at a median price of S$745 psf, followed by MCL’s Sol Acres in Choa Chu Kang where 46 units moved at a median S$781 psf. Qingjian Realty sold 37 units in its Woodlands EC project Bellewoods at a median S$769 psf.

With several new projects gearing up for launch soon, developers’ private home sales volumes in 2016 should be largely similar to 2015’s, Mr Lim added. “For the whole of 2016, we expect developer sales to be about 7,500 to 8,000 private condominium units and 3,500 to 4,000 EC units,” he said.

Upcoming projects include Forest Woods in Lorong Lew Lian by City Developments Limited, Parc Riviera at West Coast Vale by EL Development and The Alps Residences in Tampines by MCC Land and Queens Peak at Dundee Road by HY Realty.

The pre-launch marketing activities of two 99-year leasehold condominium projects Forest Woods and The Alps Residences are currently underway. They could be launched before this November.

In the next 16 months, there are about 5,100 private residential units from the Government Land Sales programme and 1,650 EC units that are yet to be launched.

Some previously launched projects released more units for sale in August, such as The Crest, The Glades, Kingsford Waterbay, The Trilinq, Highline Residences, Trilive and Riverbank @ Fernvale, suggesting that developers may be expecting sales to improve in the coming months.

Meanwhile, activities in the resale market suggest that buyers were no less active in August, with 762 resale caveats recorded compared to the 752 in July. This shows that buyers are still fairly positive on the back of an improvement in sentiment since March this year.

These resales count in the units sold by developers in delicensed projects – those have received Certificate of Statutory Completion, and individual strata titles have been issued to the buyers. For such projects, developers are not required by law to submit weekly sales data.

Based on caveats lodged, some 31 units were sold at OUE Twin Peaks in August, where deferred payment schemes are available by private treaty, at a median price of S$2,594 psf.

Some 34 units were sold at The Interlace at a median price of S$1,055 psf in August; 41 units were sold at D’Leedon at a median S$1,481 psf – both CapitaLand projects where a stay-then-pay scheme has been introduced since June 20. Four units were sold at Ardmore Three, where developer Wheelock Properties offers a 15 per cent rebate on additional buyers’ stamp duty, at a median price of S$3,814 psf..

Adapted from: The Business Times, 16 September 2016

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