84.3% of new non-landed homes sold above S$2,000 psf in September

On the back of two major launches in the Outside of Central Region (OCR), new home sales in September totalled 987 units, excluding ECs. This is a 125.3% increase from August’s new home sales at 438 units.

Last month saw developers launching 913 units for sale, up from 134 units in August during which developers tend to hold back launches during the Hungry Ghost Month. This included the launches of Lentor Modern and Sky Eden@Bedok in the suburbs, which recorded strong sales during their first weekend of sales. Lentor Modern reportedly sold 84% of its units during the first weekend, while Sky Eden@Bedok sold 75% of its units on its first day.

According to Christine Sun, Senior Vice President of Research and Analytics at OrangeTee and Tie, the launches of these two OCR projects led to the bulk of last month’s sales coming from the OCR at 69.5%. This is followed by CCR units at 20.1% and RCR units at 10.4%.

Increased proportion of new non-landed homes breaching the S$2,000 psf mark

Sun pointed out that the proportion of new non-landed homes sold above S$2,000 psf has increased from 45.7% in January this year to 84.3% last month.

Notably, as OCR projects such as AMO Residence, Sky Eden@Bedok and Lentor Modern were launched above S$2,000 psf, the proportion of new non-landed homes sold in the OCR above such a price psf has surged from 12.6% in January to 80.3% in September.

“The sales performance of both projects (Lentor Modern and Sky Eden@Bedok) was astounding, considering their price points, interest rate hikes and growing uncertainties on the macroeconomic front. Demand remains strong due to a lack of home supply in the suburbs and HDB upgraders who sold their flats in recent months still need a replacement home,” Sun commented.

Lee Sze Teck, Senior Director (Research) at Huttons Asia, added that the launches of the two OCR projects last month has bumped up the proportion of new homes priced up to S$1.5 million to 22.3%, more than double the 10.6% sold in August.

With 45.7% of the units in these projects sold between S$1.5 million to S$2 million, Lee noted that this range could be the sweet spot pricing for homes in the OCR moving forward.

“HDB upgraders were taking the opportunity to ride on the strong HDB resale market to buy a private home. As buying a new home is on progressive payment and the first drawdown on loan is usually one year later, this will allow buyers to ride out the current high-interest environment.”

7 of the best-selling projects came from the CCR

Here are the best-selling projects in September:

Source: URA, Huttons Research as of 17 Oct 2022

While OCR units formed the bulk of the new home sales last month, nearly half of the best-selling projects came from the CCR.

Outlook

Upcoming launches include Copen Grand, which will be open for sales booking on 22 October, and Tenet, Hill House and Sophia Regency in November. Kovan Jewel may also launch next month.

With the new cooling measures taking effect on 30 September, new home sale volume may be lower in the next few months as developers may defer launches to next year.

Despite the cooling measures, Sun expects demand for ECs to be robust, given the limited supply in the market.

“As prices of new suburban condos continue to rise, we may expect more eligible buyers to turn to the EC market as these homes are still more affordable and value for money.”

Would you be buying a new launch condo this year? Let us know in the comments section below.

If you found this article helpful, 99.co recommends How GuocoLand is spearheading the transformation of Lentor and Nearly all ECs resold in the past 15 years made a profit averaging S$300k.