About 1,699 private home transactions were recorded in December 2010, the highest monthly sales for 2010 and the highest number of home deals in December for the last few years.
“We normally see a dip in the number of transactions at the year-end,” said Mohamed Ismail, Chief Executive at PropNex. “And it is probably this surprisingly hot 4Q10 that has prompted the Government to announce further cooling measures on 13 January 2011.”
However, Mr. Ismail said that the full impact of the new cooling measures will only be seen clearly after the first quarter of this year.
Mr. Li Hiaw Ho, Executive Director at CB Richard Ellis (CBRE), also said the positive market sentiment “arising from improved economic conditions continued to drive the residential market in December 2010. Only 1,179 new private homes were launched in view of the year-end holiday season, half of the 2,331 units were launched in November 2010.”
However, the private property market was still very bullish in December, with one of the top-four best selling projects – Robinson Suites – sold 157 units at an average price of S$2,941 psf.
The four top-selling projects, which include Privé (326 units), The Tennery (220 units) and d’Leedon (180 units), accounted for 883 units sold in December, or around 52 percent of the total new homes sold.
Together with the 1,925 units sold in November and the 1,066 units sold in October, a total of 4,313 units were sold in Q4 2010.
“Assuming none of the units sold at the end of December 2010 were returned to the developer following the 14 January 2011 property measures, it will bring the whole 2010’s sales volume to a record of 16,364 units, 11.4 percent higher than the 14,688 new homes sold in 2009. This is higher than the 14,811 new homes sold during the market peak of 2007,” said Mr. Li.
Despite a series of cooling measures this year, the sales volume has brought an impressive 19 percent more than in 2009, bringing the total number of units sold in 2010 to 17,638.
Mr. Ismail believed that December’s number was largely due to demand from investors who were anticipating steadily climbing prices, as well as home owners who have now decided to enter the market after observing August’s cooling measures. He said that these buyers were riding the momentum of the country’s improving economy and the existing low interest rates in the mortgage market.
“In addition to the New Year and Lunar New Year breaks,” Mr. Ismail explained that “the unexpected announcement of further, more inhibitive cooling measures on 13 January will cause many potential buyers to adopt a wait-and-see attitude.”
“As such, we can expect to see about 1,000 units sold in January and much less than 1,000 units per month for February and March 2011.”