Hello, new neighbors: OCR properties dominate May residential sales

Top performer sells all but 10 units.

May’s robust residential sales were dominated by properties in the Outside Central Region, where 940 private residential properties were sold. This made up 64% of all sales in May.

According to a report by the URA and PropNex Research, May’s top performer is City Development Limited’s Coco Palms in Pasir Ris. The project sold 590 out of 600 units at a median price of $1,018 psf.

Wheelock Properties’ recently re-launched The Panorama in Ang Mo Kio also performed well, with 100 units sold at a median price of $1,241 psf, after the developer slashed prices in a bid to attract buyers.

“We expect sales performance in the subsequent months of 2014 to hover between an average of about 900 to 1,000 units per month. Private home sales in 2Q14 will likely improve by over 50% to about 3,000 units in total as market interest gradually returns with anticipation of developers' attractive offerings,” noted Mohd Ismail, CEO of PropNex.

Sales in the Rest of Central Region (RCR) and Core Central Region (CCR) reached 494 and 32 units respectively, representing 33% and 2% of the sales volume.

Here’s more from the report:

With tightened loan policies, buyers will remain more discerning and developers have to respond accordingly or risk having a poor take-up rate.

Developers need to be more sensitive to the market where value for money is key for most buyers. With the TDSR still in enforcement, it is crucial for developers to price their projects optimally, in order to achieve strong sales.

Ultimately, what matters in the current challenging environment is price — both on a psf and absolute basis. While selected projects which are reasonably priced and well located will continue to attract homebuyers, prices are expected to come under some pressure as the potential pool of buyers shrink and developers face stronger competition for consumer dollars.