Government data on Friday (Oct 26) confirmed the impact on the private home market of the latest round of property cooling measures that took effect overnight on July 6.
Private residential property prices edged up 0.5 per cent in the July to September quarter, the Urban Redevelopment Authority (URA) announced, unchanged from its earlier flash estimate, and a sharp fall from the 3.4 per cent price rise in the second quarter.
Landed properties led the way by rising by 2.3 per cent, compared with the 4.1 per cent increase in the previous quarter. But prices of non-landed properties were unchanged, compared with the 3.2 per cent increase in the previous quarter.
By location for condominums and private apartments, prices dipped by 1.3 per cent in the city fringe or Rest of Central Region (RCR) and 0.1 per cent in the suburban areas or Outside Central Region (OCR. But properties in the prime or Core Central Region (CCR) saw an increase of 1.3 per cent, after a 0.9 per cent rise in the previous quarter.
Mr Leong Boon Hoe, chief operating officer, List Sotheby’s International Realty, Singapore, noted that developers had scaled back launches in the CCR in the third quarter.
"Only 19 units were launched in CCR (293 units have been launched year to date. This has probably helped maintain pricing in the CCR," he said.
Demand for new units increased, with developers selling 3,012 private residential units (excluding executive condominiums or ECs) in the third quarter, compared with the 2,366 units sold in the previous quarter.
"The increase in new sales could be attributed to the last minute panic buying before the implementation of the cooling measures where about 1,000 new homes were sold (on the night of July 5) and a significant rise in new launches in the quarter," Ms Christine Sun, head of research and consultancy at OrangeTee & Tie said.
July 2 cooling measures include an increased additional buyers' stamp duty (ABSD) for Singaporeans and PRs buying their second home onwards and foreigners buying residential property, as well as tightened Loan-to-Value (LTV) limits.
Some 3,754 uncompleted private residential units (excluding ECs) were launched for sale in the third quarter, compared with 2,437 units in the previous quarter.
No EC units were launched for sale this quarter but developers sold 84 units from previous launches. In comparison, developers launched 628 EC units and sold 762 EC units in the previous quarter.
Resale transaction volumes slowed, with 2,672 units sold in the third quarter, compared with 4,700 units in the second quarter. Resale transactions accounted for 46.3 per cent of all sale transactions in the third quarter, compared with 65.4 per cent in the previous quarter .
"The strong sales momentum observed in Q2 was tempered by the latest property cooling measures and Hungry Ghost month, as overall sales volume in Q3 fell by 19.8 per cent quarter-on-quarter and 13.9 per cent year-on-year," Ms Sun said.
URA noted that the redevelopment of the large number of private residential developments sold en-bloc since 2016 will add a significant number of new housing units to the supply pipeline.
At the end of the third quarter, there was a total supply of 50,330 uncompleted private residential units, excluding ECs, in the pipeline with planning approvals, compared with the 45,003 units in the previous quarter. Of this number, 30,467 units remained unsold as at the end of this quarter, up from 26,943 units in the previous quarter.
After adding the supply of 2,834 EC units in the pipeline, there were 53,164 units in the pipeline with planning approvals. Of the EC units in the pipeline, 828 units remained unsold. In total, 31,295 units with planning approvals (including ECs) remained unsold, up from 26,961 units in the previous quarter.
Based on the expected completion dates reported by developers, 3,506 units (including ECs) will be completed in the last quarter of 2018. Another 11,505 units (including ECs) will be completed in 2019.
In addition, there is a potential supply of 14,200 units (including ECs) from Government Land Sales (GLS) sites and awarded en-bloc sale sites that have not been granted planning approval yet. Of this, about 6,700 units are from awarded GLS sites and Confirmed List sites and 7,500 units are from awarded en-bloc sale sites.
Most of the new supply of 14,200 units could be made available for sale next year, and will be completed from 2022 onwards.
The stock of completed private residential units (excluding ECs) increased by 83 units in the third quarter, compared with an increase of 1,152 units in the previous quarter. The stock of occupied private residential units (excluding ECs) increased by 1,042 units this quarter, compared with an increase of 1,994 units in the previous quarter.
As a result, the vacancy rate of completed private residential units (excluding ECs) fell to 6.8 per cent at the end of the third quarter, compared with 7.1 per cent in the previous quarter.
Adapted from The Straits Times, 26 Oct 2018.