The total value of new home sales this year will be worth $16 billion to $22 billion, as the real estate market sees a momentum, which started last year, according to a new report released by CB Richard Ellis (CBRE).
Based on caveats lodged for 2009, the total transaction value recorded $16.22 billion, compared to the $23.52 billion worth of primary transactions for the whole of 2007, the peak of the property market boom. According to CBRE’s analysis of URA data, dollar value of last year’s transaction in the new home market accounted for 68.9 percent of the total value in 2007.
However, the total units of new homes sold last year were close to the 2007 level. For the whole-2009, URA statistics showed that 14,688 new homes were sold in the private residential market, compared to the all-time high of 14,811 new home sales in 2007.
The lower transaction in dollar value recorded in 2009 can be attributed to the large number of small-size homes of less than 500 sq ft, which were sold last year that fetched relatively lower price quantums.
For 2010, Joseph Tan, executive director for residential at CBRE, expects that the total dollar transaction value will hit between $16.22 billion and $23.52.
The total value of caveats transaction for the first quarter this year was accounted for $4.2 billion in primary sales, or 26 percent of the transaction value last year. A total of 4,380 new homes were sold in Q1, similar to the transaction volumes recorded in 2009 and 2007 at 14,000 units each year.
“Prices are generally higher in 2010 with demand remaining robust. On that count, the total value at the end of the year should be higher than that in 2009,” said Mr. Tan.
“In addition, there is a good chance of the luxury segment making a notable return in the later half of the year, as competitive tax rates and a highly- rated liveable environment might attract more high-net-worth foreigners to Singapore.”