Singapore new home sales drop for the second month in May 

Home sales plunged to a record low for the month of May since 2008.

New home sales in Singapore dropped 26.6% MoM in May, marking its second straight month of decline due to the absence of major project launches and tepid demand.

New home sales last month slid to 221 units from 278 units in April to reach the lowest monthly tally since 153 new condos were sold in February. 

According to Tricia Song, research head of CBRE for Singapore and Southeast Asia, it was also a record low for the month of May since data was available in 2008, breaking the previous record low of 487 sales recorded at the height of the pandemic in May 2020.

Year on year, developer sales tanked 78.7% last month compared to 1,039 units that traded in May 2023 when there were two big project launches: the 816-unit Continuum and the 732-unit Reserve Residences.

Song said the subdued sales were due to the absence of big project launches and muted demand. She said home buyers are now more cautious about making such big-ticket purchases given the flurry of home choices they have, current high price points and elevated borrowing costs.

Christine Sun, chief researcher and strategist at OrangeTee Group, shared the same view, noting that last month’s weak showing did not come as a surprise since there were only two small projects launched in the suburbs: the 21-unit Jansen House and the 16-unit Straits at Joo Chiat.

The sole project launched in the city centre last month, the 190-unit luxury condo Skywaters Residences, meanwhile, is on the pricier side and has likely exceeded the budget of the majority of the homebuyers, according to Wong Siew Ying, research and content at PropNex Realty.

“It is likely that many prospective home buyers are waiting for more projects to be launched, so that they can make comparisons before deciding on their property purchase,” Wong said.

From January to May, new home sales were still down 47% YoY to 1,686 units from 3,185 units sold during the same five-month period last year.

Moving forward, Sun expects buying activity to pick up in the upcoming months in anticipation of several high-profile project launches, including Sora, The Chuan Park, Union Square Residences and Emerald of Katong.

“We expect strong sales in these developments to contribute significantly to developers' sales in the next few months,” she added.

PropNex’s Wong was less optimistic as she expects home sales in the second quarter to underperform the 1,164 new units sold in Q1, and the 2,127 new units sold in Q2 2023.

“Developers’ sales will likely remain soft in June 2024, in view of a lack of project launches, as well as the school holidays where there tend to be a lull in transactions as many families travel abroad,” she said.