REAL estate developers in Singapore moved 1,589 private homes in July this year, an 82.2 per cent surge from the 872 units sold in the previous month.
These figures - which exclude executive condominium (EC) units - were released by the Urban Redevelopment Authority (URA) on Monday, based on its survey of licensed housing developers.
By region, the lion's share of the sales volume last month came from the suburbs or Outside Central Region (OCR), where 1,012 units or nearly two-thirds of the total volume were sold, according to the URA data.
Huttons Asia chief executive officer (CEO) Mark Yip noted that seven of the 10 best-selling projects in July were in the OCR. In particular, Pasir Ris 8 (PR8), which launched on July 24 and 25, saw "overwhelming demand" and sold more than 85 per cent of its units, given that it was the first OCR launch of the year, he added.
New sales also ticked up in late July at other projects, before the developers implemented their planned price hikes, The Business Times (BT) earlier reported.
OrangeTee & Tie senior vice-president of research and analytics, Christine Sun, observed buyers returning to the private residential market "in droves", with some rushing to purchase for fear of being priced out of the market.
PropNex Realty CEO Ismail Gafoor said recent aggressive land bids may have prompted purchasers to expect future launch prices to rise further. “A good number of investors and homebuyers, who have been waiting for the right opportunity, decided to enter the market in July in anticipation of possible price hikes in the future,” Mr Gafoor added.
Huttons' Mr Yip said that based on caveats lodged, 445 units were sold from July 25 to 31, much higher than the first half of the month when 404 units were transacted.
Within a sample of 10 projects - including Sengkang Grand Residences, Normanton Park, Midwood and Ki Residences at Brookvale - new sales in July doubled from June on average, according to Huttons Research.
"On the back of PR8's successful launch, there was spillover demand to other integrated projects and projects even outside the vicinity," Mr Yip said.
ERA’s head of research and consultancy, Nicholas Mak, said PR8's multiple price hikes caused some potential buyers to turn to other projects. “Some buyers who decided not to buy PR8 units claimed that property agents offered to lead them to other projects such as Normanton Park and Sengkang Grand Residences,” Mr Mak noted.
The increase in the daily average number of units sold at other projects, after PR8’s price revisions, indicated that some homebuyers remain price sensitive and may be willing to substitute one project for another at a different location, especially if they are investors, he added.
Meanwhile, URA data showed that the city fringe or Rest of Central Region (RCR) accounted for 438 units or about 27.6 per cent of July's total volume excluding ECs, while the Core Central Region (CCR) saw 139 units sold or just 8.7 per cent.
Year on year, last month's new sales were 46.7 per cent higher compared with July 2020.
The country's recent tightened measures due to the pandemic did not appear to dampen market sentiment significantly, Ms Sun said.
"The impact of the curbs was more modest this time, compared to previous rounds. Developers and sales agents learnt to 'get over the bump' by using technology to close deals and deployed social media tools to stay in touch with customers," she noted.
Singaporean buyers made 86.3 per cent of the purchases in July, while permanent residents and foreigners accounted for 9.4 per cent and 4.2 per cent respectively.
The bigger proportion of Singaporean buyers, compared to June's 81.8 per cent, was likely due to PR8's launch, as demand for new private homes in the OCR would predominantly come from those upgrading from their Housing and Development Board (HDB) flats, Mr Yip noted.
"More than 6,000 HDB flats in Pasir Ris and Tampines that were completed from 2014 to 2016 have met the five-year minimum occupation period and are thus eligible for upgrade," he said.
Including ECs, which are a public-private housing hybrid, developers found buyers for 1,744 units last month, up about 81.3 per cent from June's 962 homes.
As for new launches, 1,104 units were put on the market in July, an increase of 35.5 per cent from the previous month. The OCR accounted for the bulk of the launch volume with 879 units.
Despite August being the lunar seventh month, developers are likely to push ahead with their launches to ride on the positive momentum, Mr Yip said.
UOL Group’s The Watergardens at Canberra and Low Keng Huat’s Klimt Cairnhill will open for preview sales this month. For The Watergardens, UOL has said it is thus far sticking to its indicative prices, which start from S$1,380 per square foot.
“August is likely to be another month where developers’ sales cross the 1,000-unit mark. This will whittle down the unsold stock in the market to even lower levels, setting the stage for sustained price growth in the months ahead," Mr Yip added.
OrangeTee & Tie's Ms Sun anticipates that the current home supply, especially in the suburban region, will not be able to meet the “swelling demand” from Singaporeans such as HDB upgraders.
For the full year, ERA’s Mr Mak expects developers to sell about 11,500 to 12,500 private homes in total, about 20 per cent more than in 2020.