Developers sold 228 new private homes in June, setting a new low for 1H 2024

According to the latest developer sales figures, property developers sold 228 new private residential homes (excluding executive condominiums) in June, up 2.2% from 223 units in May.

Taking June's developer sales into account, a total of 752 new private residential units were transacted in the second quarter of this year.

The number of new private homes sold by developers last month was down 18% compared to the 278 units moved over the same period last year. In light of a subdued economic environment, buyers remain highly selective and budget-conscious.

The LakeGarden Residences emerged as the best-selling private residential project last month, moving 23 units at a median price of $2,119 psf.

The launch of the neighbouring Sora over the weekend of 5 to 6 July could rekindle interest in nearby previously launched projects, such as The LakeGarden Residences, which was rolled out in August last year.

Between January and May this year, The LakeGarden Residences transacted just 22 units, as many prospective buyers held off on their purchases until Sora's preview.

The commitment by a consortium of five major developers to undertake a mega master development on the Jurong Lake District white site is likely to bolster buyers' confidence in acquiring property in the precinct, spurring demand for new home sales in the area.

Furthermore, 19 of the 23 units sold at The LakeGarden Residences were 75 sq m or larger. This reflects strong demand for larger-format units from buyers—likely HDB upgraders—purchasing for owner-occupation.

Other top-selling projects last month included The Botany at Dairy Farm, which moved 21 units at a median price of $1,979 psf; Tembusu Grand, with 20 units sold at a median price of $2,542 psf; and Hillhaven, which transacted 18 units at a median price of $2,124 psf.

The first six months of this year registered the lowest half-year sales volume in the new private home market since 2000.

In the first half of 2024 (1H 2024), developers sold only 1,916 new private homes (excluding ECs), tumbling 43.4% from the 3,383 units sold in 1H 2023. The 1H 2024 volume was also down 54.6% from the 4,222 units moved in 1H 2022.

Sales figures for 1H 2024 fell below those recorded during the Global Financial Crisis, when 2,287 units were moved in 1H 2008. Even during Singapore's circuit breaker lockdown in 1H 2020 amid the COVID-19 pandemic, developers still managed to transact 3,862 units.

The record-low sales volume in 1H 2024 was primarily attributable to a record-low number of units launched during the period. An estimated 1,938 units were placed on the market in the first half of the year, compared to the previous low of 2,080 units launched in 1H 2004. Naturally, when fewer new homes are launched, total transaction volumes tend to contract.

Despite the relatively muted performance in the primary market over the first six months of the year, the luxury residential segment still saw several notable deals across prime developments such as Skywaters Residences, 32 Gilstead, and Watten House.

While transactions have been measured, these high-profile deals highlight sustained investment interest in Core Central Region (CCR) luxury properties.

Looking ahead, developers' sales figures for July are poised to rebound sharply on the back of major project rollouts this month, including Sora, Kassia, and The Green Collection.

Sora, a 99-year leasehold project along Yuan Ching Road in Jurong Lake District, moved 102 units during its launch weekend on 5 to 6 July. This represents approximately 23% of the 440-unit development, achieving an average price of $2,160 psf.

Meanwhile, the 276-unit Kassia is scheduled to launch on Saturday, 20 July. This freehold development marks the final phase of the Flora Drive–Flora Road private residential enclave.

Concurrently, another new project, The Green Collection, comprises 20 strata-titled villas overlooking the Tanjong Golf Course in Sentosa Cove.

Upcoming projects slated for launch in 3Q 2024 include 8@BT, the 847-unit Emerald of Katong, Arina East Residences, Meyer Blue, the 366-unit Union Square Residences, the 348-unit Norwood Grand, and the 916-unit The Chuan Park.

With a growing pipeline of projects gearing up for launch in 3Q 2024, transaction volumes in the primary market are anticipated to pick up.

Around 17 new project launches are expected to enter the market in the second half of the year, bringing an estimated 8,400 new private residential units.

However, with the upcoming seventh lunar month—also known as the Hungry Ghost Festival—fast approaching, most developers will likely time their launches to steer clear of this period, which is traditionally regarded as inauspicious and tends to weigh on buyer sentiment.

Nonetheless, with an increasing selection of new developments available, most buyers are likely to become even more discerning and cautious. Transaction activity could remain measured until interest rates start to trend lower.

Driven by higher land acquisition costs incurred 12 to 18 months ago, alongside prevailing construction and development costs, new private home prices are projected to rise by around 3% to 5% this year.

Many market watchers forecast that full-year new private home sales for 2024 will range between 4,000 and 6,000 units, down substantially from the 7,000 to 9,000 units projected at the start of the year.