Despite a month-on-month spike in developers’ sales in March, sales of both the primary and secondary markets eased in the first quarter, according to latest figures from URA.
Official figures yesterday on primary market activity show that developers’ sale of private homes excluding executive condos (ECs) rose 25.4% month on month to 1,386 units in March, buoyed by higher sales in Core Central Region and Rest of Central Region, as well as a s a bigger proportion of transaction in higher price bands.
However, the 3,595 units which developers sold in the first quarter (excluding units sold in the first two months of this year which have been returned to developers) were 15.2% below the 4,241 units sold in the preceding quarter and 17.9% lower than the 4,380 units they sold in Q1 2010. It is also the poorest quarter for new home sales since the fourth quarter of 2009.
The decline is possibly due to the weeding out of speculators as the cooling measures take effect, experts say.
Suburban homes were the most popular, comprising 46% of the total sales last month, indicating sustained demand from HDB upgraders.
In addition, CB Richard Ellis’ analysis of URA Realis caveats data reflects a slowdown in secondary market sales in Q1. The number of private homes transacted in the resale market, which involves projects that have received Certificate of Statutory Completion (CSC), fell to 3,168, down 24% from the previous quarter.
Subsales – secondary market deals involving projects that have yet to receive CSC and which are often seen as a proxy of speculative activities – also slipped, down 25.5% quarter on quarter to 550 units.
Year on year, the Q1 resales volume was down about 36% and subsales fell around 45%. However, analysts say that the final resale and subsale numbers for Q1 may be higher as more caveats are lodged.
They also note that despite the drop in both primary market and resale deals in Q1, the figures remain above the 3,000-unit mark, keeping prices firm.
URA figures yesterday show that including ECs (a hybrid of public and private housing), developers’ sale totalled 1,543 units in March, 25.2% more than February’s 1,232 units, The 1,246 units (including ECs) they launched in March were down 27.1% from 1,710 units in February.
CBRE expects developers to sell about 3,000 – 3,500 units in the second quarter, with prices remaining stable.
Last year, developers sold a record 16,292 private homes (excluding Ecs), up 10.9% from the preceding year.
URA’s flash estimate earlier this month reflected a 2.1% q-o-q rise in the overall private home price index, which climbed 17.6% for the whole of 2010.
Colliers noted that the sales volume (excluding ECs) in Core Central Region – which includes prime districts 9, 10 and 11, the financial district and Sentosa Cove – climbed 85.2% month on month to 263 units in March, while the figure for Rest of Central Region (which covers locations such as Bukit Merah, Queenstown, Geylang, Toa Payoh and Katong) posted a 119.6% m-on-m sales increase to 492 units. However, the volume of mass-market homes in Outside Central Region recorded a 14.6% m-on-m drop to 631 units. Further evidence of interest returning to pricier properties was seen in a jump in the proportion of new sales at above $2,000psf from 8% in February to 15% in March.
*Source: The Straits & Business Times
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