Singapore New Home Sales Rise 14% in March as More Condos Hit The Market

Singapore new private home sales rose 13.6 percent to 492 units in March, reaching their highest level in six months as homebuyers bought up available units as quickly as they entered the market, according to data released by the Urban Redevelopment Authority (URA) on Monday.

Developers sold 59 more private homes last month than they had in February, largely thanks to the strong performance of the sole project launched in March – The Botany at Dairy Farm in Bukit Panjang – which saw nearly half of its 386 condos find buyers on opening day.

“The sales performance at recent new launches should help to put wind in developers’ sails,” said Siew Ying Wong, research and content head at PropNex Realty. “We believe the positive sales outcomes reflect the resilient underlying demand for new private homes and the still ample liquidity in the market.”

With at least one more project set to launch this month and another four on the way in May, analysts are expecting sales to pick up further, albeit with the surge of supply potentially dampening home price growth.

Near-Sellout Achieved

March marked the third consecutive month that developers reported higher sales compared to the previous month, and the highest total since the 987 units transacted last September, according to data compiled by PropNex Realty.

Homebuyers purchased 86 percent of the 573 new condos that were put up for sale in March, which was 43 percent more than the 401 units launched in February.

Of the total sales, 184 were at The Botany at Dairy Farm, a suburban project by local private builder Sim Lian Group. Homes in the project fetched a median price of S$2,068 per square foot ($1,553) and accounted for 37 percent of overall transactions for the month.

Year on year, the volume of new homes sold last month was still lower by a quarter than the 654 condos sold in March 2022, as heightened market uncertainties have begun to weigh on buying sentiment, according to JLL’s research and consultancy head for the residential sector, Siew Chuin Chia.

“Some potential buyers could have remained on the side-lines, waiting for more options from new project introductions,” Chia said.

For the first quarter, buyers picked up 1,318 new private homes, nearly double the 690 transacted in the preceding three months, but still down 27.8 percent compared to the 1,825 sales from January through March 2022.

During the first three months of this year, developers recorded a 95 percent take-up rate for the 1,384 new units placed on the market, which was nearly triple the 504 homes supplied in the fourth quarter of 2022, and more than double the 613 units launched during the same period a year earlier, based on data compiled by JLL.

“The take-up at recent launches is encouraging despite the cautious sentiment and is indicative of underlying demand in the market,” Chia said. “Developer sales are expected to gain traction from the second quarter, as more project launches are rolled out.”

Supply-Driven Sales

By region, the suburbs, known as the Outside Central Region in Singapore, were the top-performing region last month accounting for 47 percent of homes sold thanks to the Sim Lian project.

This was followed by the city centre or the Core Central Region – a proxy for luxury homebuyers – with 197 units sold or 40 percent of total March sales. In the city fringe or the Rest of Central Region, there were only 65 new condos that changed hands in March, accounting for about 13 percent of monthly sales. Both regions did not have any major projects launched last month.

“The current buying trend seems to be more supply-led rather than demand-driven, depending largely on what projects are released that month,” said Christine Sun, senior vice president for research and analytics at OrangeTree & Tie.

The second most popular project was Leedon Green, a Bukit Timah joint venture of Hongkong Land affiliate MCL Land and Shanghai-based Yanlord, with 26 units sold at a median price of S$2,957 per square foot. Adding to the March totals were MCC Land’s The Landmark condo near Chinatown MRT station and Pullman Residences Newton by EL Development in Novena.

Price Growth to Slow

PropNex’s Wong expects home sales to rise again this month after Tembusu Grand, a CDL and Hongkong Land joint project, registered 340 sales during its launch weekend on 8-9 April, while EL Development’s Blossoms by the Park in One-North is scheduled to hit the market before the end of April.

Wong said sales will likely pick up further in May as up to four additional condo projects become available to the public. On May’s roster are the 807-unit The Continuum project and Newport Residences, while the Lentor Hills Residences in Ang Mo Kio and The Reserve Residences in Bukit Timah could also potentially be launched next month.

Considering the estimated 11,500 new private condos set to enter the market this year (more than double the 4,528 units launched in 2022), PropNex expects that up to 9,000 private homes will be sold by the end of December, up from last year’s total of 7,099 units. Despite the influx of new supply, home price growth is expected to continuing rising, albeit at a softer pace of 6 to 8 percent, compared to the 8.6 percent growth logged in 2022.

During the first quarter, new home prices rose by 3.2 percent, accelerating from the 0.4 percent uptick in the preceding three months, based on preliminary URA data released earlier this month. January through March marked the 12th straight quarter of rising home prices in Singapore, with rates now up by 27.9 percent from 2020.