Up-market home sales dropped in Q2

Sales of high end homes moved slowly in Q2 as foreign investors held back their purchases on fear of weakened foreign currencies against Singdollar.

CB Richard Ellis Pte Ltd released findings that the projects that sold well in the second quarter were mostly in the low- to mid- tier price range.

A CBRE report indicated 40 units of Marina Bay Suites (Phase 2) and 33 units of Goodwood Residence were sold at a median price of $2,600 psf and $2,480 psf, respectively. In the Nassim enclave, three luxury units in Sage were sold at around $3,220 psf while two units of Nassim Park Residences were reportedly sold above $3,700 psf each.

Although new home sales rose in the first quarter of 2010 to April, uncertainties crept in from late May after news of the European debt crisis triggered volatility in the global stock markets that caused the momentum of home sales to slow down.

Some 4,000 new homes were estimated to be sold in the second quarter which, together with the 4,380 units sold in the first quarter, added up to around 8,300 new homes being sold in the first half of 2010. This is more than half or 56.5%, of the 14,688 new homes sold in 2009.

Joseph Tan, Executive Director, Residential said, “The Singapore economy seems on- track to achieve its forecast growth of 7.0 percent to 9.0 percent for 2010 because of a strong boom in manufacturing and exports.”

Tan said new launches in Q3 2010 may include Waterfront Gold at Bedok Reservoir and The Scala at Serangoon Avenue 3, The Waterline at Poh Huat Road West and the project on the site of former Concorde Residences among others.

“While the volume of new homes sold in the third quarter may be reduced to around 2,000 units, home prices are likely to remain firm,” added Tan.

The CBRE report also said based on caveats lodged, about 33.7 percent of the new home buyers in the second quarter of 2010 were HDB addressees, commonly regarded as HDB upgraders. A quarter ago, HDB upgraders accounted for some 37.9 percent of the buyers of new homes. The reduction could be attributed to a smaller supply of mass-market type of projects being launched in the second quarter compared to the first quarter.

Meanwhile, sales activity in the resale market was almost the same pace as that in the new homes market. Some 3,400 to 3,600 resale homes were estimated to be sold in the second quarter, 15% to 20% lower than the 4,261 resale homes sold in the previous quarter.