Newly-launched projects had ‘encouraging' sales despite property curbs

Daintree Residences had 46 of its 80 units released for sale in July.

New residential projects in Singapore have been marketed despite troubled buyer and investor sentiments brought about by the cooling measures in July. The catch is that some of these projects have been met with fairly encouraging sales, CGS-CIMB said.

According to analyst Lock Mun Yee, Daintree Residences saw 46 of the 80 units released for sale in July taken up whilst The Tre Ver saw 140 units taken up when released for sale in August. The 1,206-unit Jadescape is also currently being previewed.

Also read: Low developer sales in June marks calm before the storm: analysts

“We believe homebuyers could remain selective, particularly with more choices and a more cautious sentiment on the ground,” Lock said.

July had become a bumper month for developer sales only thanks to new launches, however, home take-up rates have declined, CGS-CIMB noted.

Sales recorded by the Urban Redevelopment Authority (URA) soared by 164% from June as 1,776 units were sold in the month. Take-up rates have plummeted to 77% from 118% in H1 as developers released more units into the market and buyers have plentiful choices.

Moreover, YTD sales were 24% lower YoY. CGS-CIMB revised its annual sales forecast from 11,000-12,000 units to 10,000 units due to the cooling measures’ dampening impact on demand. Despite lower take-up rates, the replacement demand from en bloc sellers would provide some support for transaction volumes in the near term, they said.

“Going forward, with the rise in land prices recently, resulting in high landbank cost, any significant price retracement or prolonged land holding period could impact development margins,” Lock commented. “Good sell-through rates and faster asset turn are key to preserving development margins.”