Rate cut effect begins to show as September private home sales surge 90% to 401 units

New private home sales by developers in Singapore nearly doubled in September, signalling a rebound in market activity following the Hungry Ghost Month. Compared to August, new home sales surged by 90% to 401 units in September, up 84.8% year-on-year.

Analysts noted that the initial effects of the US Federal Reserve's interest rate cuts have begun to emerge, with improved private home sales in September setting a positive tone for the final quarter of the year. With more new projects lined up over the next two months, full-year new private home sales are projected to reach around 5,000 units.

8@BT, the first private residential project launched after the Hungry Ghost Month, emerged as the top-selling project in September with 83 units sold, driving the city fringe or Rest of Central Region (RCR) to account for more than half of the month's total sales.

The RCR recorded the highest number of launched units at 280, as well as the highest number of units sold at 221. This was followed by the Outside Central Region (OCR), representing the mass market, which launched 128 new private homes and sold 165 units. The Core Central Region (CCR), representing prime or luxury properties, saw 29 new units launched and 15 units sold.

Analysis: Buyer Confidence Recovers on Economic and Rate-Cut Tailwinds

This trend suggests that buyer confidence is gradually returning, bolstered by positive economic sentiment and interest rate cuts.

Beyond the rebound in newly launched projects, data from OrangeTee Group also showed that sales momentum picked up across previously launched developments. For instance, Pinetree Hill moved 72 units in September, marking a substantial increase from just four units sold in August.

The majority of buyers favoured homes priced below $2.5 million, which accounted for 64.4% of total sales in September.

Although CCR private home sales accounted for only 3.7% of total transactions, sales of luxury homes priced at $5 million and above rose from seven units in August to 12 in September, with 10 of these located in the CCR.

This marks the second month since April this year that sales of luxury private homes exceeded 10 units. However, this uptick does not necessarily point to a robust recovery in the luxury segment, and monthly sales may dip below 10 units in the coming months.

Analysts generally believe that the effects of the Fed's 50-basis-point rate cut are taking hold, which bodes well for new launches in October and November.

Meyer Blue, the second project launched after the rate cut, moved 50% of its units on its launch day, and Norwood Grand, slated to launch later in October, is also expected to put up a strong showing.

According to the latest data released by the Urban Redevelopment Authority (URA) on Tuesday (15 October), developers launched 437 new private homes (excluding Executive Condominiums, or ECs) and sold 401 units in September.