Private property sales accounted for in February was for real. For two straight months, home buyers had taken advantage of the falling economy to purchase over 1,000 units in March.
According to property consultants, house buyers are more attracted to what they consider as great buys in a reasonably priced mass market. However, they warned that the excellent buying levels may not be sustainable.
Several developers managed to sell 1,220 new private homes last month, slightly lowered from the 1,332 units in February.
In the past year, this was the first time for the market to have over 1,000 units sold for two consecutive months. Another outstanding figure: new private home sale reached to 2,660 units during the first-quarter, equivalent to 62 percent of the entire new homes sold for the whole year of 2008.
Sales in February were mainly boosted by two new project launches – Caspian and Alexis – which became the largest ever since August of 2007.
The Urban Redevelopment Authority compiled the figures. It also showed that on the previous month, another 832 new housing units were released, higher compared to 204 units in January but much smaller to 1,072 units in February.
Last month, most of the sold units were in the mass market, together with some city-bordered small-type apartments at condos like The Mercury and Domus.
HDB developers were the hottest group buyers. According to CBRE Research, group of buyers purchased 550–600 units at the mass market projects like Double Bay Residences, Caspian, The Quartz, Kovan Residences and Livia, Mi Casa. The average prices for these units range from $610 per square foot to $740 per square foot.
According to CBRE Research Executive Director Li Hiaw Ho, a survey during the first quarter indicated that the market segment had an average price of $95,000. “This is probably a good time for HDB home owners to upgrade to private property as the price gap between private properties and HDB resale flats have narrowed.”
In terms of last month’s sale, the three top sellers were The Arte, Mi Casa and Double Bay Residences. About 85 percent of the total units sold in March were below $1,000 per square foot, said chief executive of PropNex Ismail.
Overall, 100 prime units had been released in Q1 of 2009, with only 4.7 percent of the total unit launched, falling from 39.4 percent of the total units launched in Q4 2008.
Nicholas Mak, research and consultancy director for Knight Frank, said the low figure was partially due to the withdrawal from the luxury market of several foreigners.
“In the short term, this rate of buying can continue provided developers lower or maintain their prices,” said Colin Tan, head of research and consultancy of Chesterton Suntec International, with regards to the March sales.
However, this could not be sustained for a long term, “The last time the market sold so many new units (14,811 units) was in 2007. That was when the deferred payment scheme was available. And it has since caused indigestion in the top end of the market.”