Home sales slowed in April after a strong showing a month ago. However, property developers haven’t been deterred, and plan to launch more residential projects this weekend.
In March, 1,761 new private homes were sold – a 47 percent month-on-month increase; however, market watchers said that sales have come off this month, though there have been exceptions.
According to UOL Group, it sold over 130 units in its 616-unit Waterbank at Dakota condominium from Friday to Sunday, taking the number of apartments sold in the project to more than 500. Apartments went from $1,000 psf to $1,300 psf, and the group announced that it will launch more this weekend.
Potential buyers can also look forward to two projects that will be released for the first time this weekend – The Holland Collection from Lippo Group and CLSA Capital Partners, and the Tree House from City Developments.
The 26 high-end luxury homes at The Holland Collection are being built on the site of the former Aura Park condo on Holland Road. In June 2007, Lippo acquired the site through a collective sale deal for $1,280 psf of potential gross floor area – a high for the location. CLSA Capital Partners took half of a stake in the project a few months later.
Mr. Peter Tham, development director of CLSA Capital Partners, said that the partners wanted to launch the project in 2008 but decided to hold back until market sentiment shows signs of improvement.
“The market took a turn for the worse and we might not have achieved our break-even price,” said Mr. Tham. “But we took advantage of the decline in construction costs and started building in September last year.”
The Holland Collection’s 26 units will feature 19 unique variations in size, layout and space configurations. Sizes of apartments range from 1,281 sq ft to 3,606 sq ft. Additional units will be launched this weekend at an average price of $2,000 psf.
Meanwhile, City Developments will launch its 429-unit Tree House on Chestnut Avenue. According to agents, prices start from around $600,000 for a 721-sq-ft two-bedroom apartment.
Analysts have warned that government policy risk could come back into focus after the robust sales in March.
“We believe that policy risk still exists,” said Mr. Adrian Chua, an analyst from DBS Group Research. “Back in January, strong monthly sales of around 1,480 units triggered a second wave of government measures.”
Deutsche Bank also raised a red flag last week. The bank’s analysts believe that possible cooling measures the government could use include lowering the loan-to-value limit for second home purchases, increasing land supply, and a capital gains tax.
Despite this, some analysts believe that home sales are likely to remain healthy for 2010 amidst the economic recovery in the country.
Mr. Chua has raised his 2010 forecast for private home sales from 8,000-10,000 units to 10,000-12,000 units, following strong figures seen in Q1 2010.