home prices edged up by 0.5% q-o-q in the fourth quarter, based on the movement
of the URA price index. This modest upside followed the 1.3% and 1.5% gains in
the previous two quarters even though there was a 0.7% decline in Q1 2019.
Prices of non-land homes in Q4 2019 were largely supported by mass market transactions, as evidenced by the 2.8% q-o-q increase in the price index for Outside Central Region (OCR). The price index for both the Core Central Region (CCR) and the Rest of Central Region (RCR) posted q-o-q declines of 2.8% and 1.3% respectively.
Through the whole of 2019, the price index for OCR and RCR saw respective rises of 4.2% and 2.8% while the CCR price index fell by 1.7%.The resultant effect is a 2.7% y-o-y increase in the overall residential price index, which is a more sustainable rate of increase compared to the 7.9% hike in 2018.
pitched in their best efforts in the final quarter of 2019 and raked in a sales
volume of 2,443 new homes. This was 25% lower than the 3,281 new homes sold in
Q3 2019, attributable to seasonal factors as well as a function of a lower
number of new launches. In fact, the
2,226 new homes launched in Q4 was the lowest number offered by developers
among the four quarters in the year, while Q3 recorded the highest number of
3,628 units launched.
In total, 11,345 new homes were launched. 9,912 new homes were sold in 2019, 13% more than the 8,795 units sold in 2018.
New sales outpaced resales
the 12 new projects launched in Q4 2019, six were projects located in the CCR.
For the rest of the projects, all except one are located in the OCR. The top
two performers were One Holland Village Residences (CCR) and Sengkang Grand
Residences (OCR), with 113 and 234 units sold respectively. Both are mixed use
projects with strong location attributes – the former is located in Holland
Village in prime district 10 while the latter is located in Sengkang new town
and will be integrated with the Buangkok MRT
economic uncertainties, the large supply of new homes and higher prices of new
projects due to high land costs have resulted in selective buying behaviour. Of
the 9,912 new homes sold in 2019, units from projects that were launched in the
year made up some 5,200 units (52%). The top performers achieved a take-up rate
of only 35%-40%. Under present circumstances, it has taken 15 months or more
for new projects to achieve 80% sales, particularly mega projects with over
pace of sales in the secondary market remained steady with 2,342 resale homes
in Q4 2019, slightly below the 2,378 homes and 2,371 properties sold in Q3 and
Q2 respectively. For the whole year, resale homes totaled 8,949 units, 31%
lower than the 13,009 units sold in 2018. It was probable that some resale
demand had been diverted to new projects which are more attractive.
to the fall in resale homes, 2019’s home sales totalled 19,150 units, 13% lower than the sales
were 87 luxury apartments that were sold in Q4 2019, lower than the 100 that
were sold in the previous quarter. The top deal was a penthouse at TwentyOne Angullia Park
that was sold for $32 mil ($4,146 psf). Three units at The Marq On
Paterson Hill were sold between $25 mil ($4,011 psf) and $29.5 mil ($4,677 psf). A
record number of 21 luxury apartments broke the threshold of $4,000 psf. This
is nearly three times the eight units in 2018.
Q4 2019 saw the sale of 11 bungalows within the Good Class Bungalow (GCB) Areas and one at Sentosa Cove. were sold, compared to 10 in Q2 2019. The most expensive GCB sold in Q4 2019 was one located at East Sussex Lane with a land area of 36,882 sq ft. It fetched $36.88 mil ($1,000 psf). At Sentosa Cove, the villa located at Cove Drive was sold at $19.89 mil ($1,699 psf). The tally for the entire luxury segment stood at 404 deals in 2019, signaling a slowdown from 2018.
luxury home buyers in CCR comprises a high proportion of 67%-70% permanent
resident and foreign investors, compared to the share of 20%-24% in the RCR and
OCR. The top five foreign nationalities in 2019 were Mainland Chinese,
Indonesians, Americans, Taiwanese and Cambodians.
Rental market & vacancy
rents weakened in Q4 2019, as shown by the 1% q-o-q decline in the URA rental
index. This happened despite a 10% fall in the number of vacant units from Q3
2019 to 20,479 units. The fall in rental could be attributed to the ongoing
competition for tenants between new and older developments. The fall in vacant
homes could be due to higher occupation as families move into their new homes
during the year-end holidays. The vacancy rate in Q4 2019 was 5.5%, an
improvement from 6.1% in Q3 2019.
locality, the CCR and OCR rental index fell by 1% each in Q4 2019, while the
RCR rental index fell by 0.7%. Nevertheless, for the whole year, rents in all
three localities registered increase from a year ago: 1.4%, 2.0% and 2.7% for
CCR, RCR and OCR respectively.
2019, 2,298 new homes were completed, the major ones being Park Riviera (752
units), GEM Residences (578 units), Park Place Residences (429 units) and Stars
At Kovan (395
units). This brings the total new completions in 2019 to 7,527 units, which is
the lowest since 2007.
forward, new completions in 2020 would be even lower at 6,294 homes.
Thereafter, new completions are estimated to jump to 10,579 units in 2021,
15,037 units in 2022 and peaking at 16,442 units in 2023. The high numbers in 2022 and 2023 are due to
the mandatory five-year completion deadline for projects from the collective
sale frenzy in 2017 and 2018.
Supply in the pipeline
end-2019, there were 49,173 private homes that were under construction,
slightly lower than the 50,964 units at end-September. This comprised 19,011
units (39%) which have been sold and 30,162 unsold units (61%). Of the 30,162
unsold units, 19,526 units (65%) were from projects that were either launched
or not launched yet and 10,636 units (35%) from projects that did not have the
prerequisites for sale. Compared to 2018, the number of unsold units has been
reduced by 13%. This could be attributed to the nearly-absent collective sales
as well as the restrained government land sales (GLS) programme.
new projects which obtained Written Permission in Q4 2019 included the projects
at Clementi Avenue 1 (640 units), former Goodluck Garden (633 units), Sims
Drive (566 units), Middle Road (522 units) and Nim
Road/ Ang Mo Kio Avenue 5 (132 landed homes).
Gardens at Lorong 32 Geylang was
sold en bloc
to a private investor for $26.28 mil or $623 psf/plot
ratio. The site was sold as a 104-year leasehold interest carved out by the
owner. If developed, the 16,412 sq ft
site can yield around 50 apartments.
There was no sale of sites by the government in Q4 2019 but the GLS programme for H1 2020 was announced.
confirmed list comprises an executive condominium site at Yishun Avenue 9 (600
units), a private residential site at Tanah Merah Kechil Link
(310 units, 2,000 sqm commercial) and a commercial-residential site at Jalan
Anak Bukit (865 units, 20,000 sqm commercial).
In addition, there are four residential sites and two white sites on the reserve list which developers can apply for release for sale by tender through submitting a bid which is acceptable to the Chief Valuer.
At the close of 2019, things were beginning to look up as the US and China were going to sign phase one of a trade deal in mid-January 2020 and Brexit was on track to take place on 31 January. The Singapore economy was beginning to show signs of stabilisation from the sharp slowdown in 2019 when the outbreak of the novel coronavirus posed a new threat. Besides tourism and its related sectors which are the worst hit, the current travel restrictions will put brakes on the momentum of home buying by Mainland Chinese. Mainland Chinese have been the top group of foreign home buyers since 2011 except for 2012 and 2015 when it took the second place.
at the showflats of
new launches will likely be affected even though precautionary measures will be
taken by developers to prevent the spread of the virus.
If the virus outbreak ends soon, business would resume and sentiments would improve. In the short term, home prices will remain at current levels. This might bode well for people to pick up some good value buys. Nevertheless, it is probable that new sales volume in the first quarter could turn in lower than the 1,800 units sold in Q1 of 2019.
Should the coronavirus crisis be prolonged, home prices might see a marginal correction and sales volume would be lower than the 9,900 units sold in 2019.
expect Singapore’s strategic position as an Asian gateway and the strong
fundamentals to continue to attract the affluent in an increasingly uncertain
global environment. Part of the drop in Mainland Chinese buyers could be picked
up by other nationalities looking to invest in Singapore.