Singapore’s Housing Market in 2020 to remain positive
New personal house gross sales for the primary 11 months of 2019 totalled 9,547 items (excluding govt New personal house gross sales for the primary 11 months of 2019 totalled 9,547 items (excluding govt condos or ECs). .
The URA personal house value index elevated by 1.5% in 2Q2019 and 1.3% in 3Q2019 which most likely lent extra confidence to patrons and sellers, contributing to the comparatively wholesome gross sales within the major market, provides Ong. Subsequent yr, PropNex’s Ismail reckons about 37 new initiatives shall be launched. He forecasts gross sales momentum to “keep constructive” with new house gross sales within the vary of 9,000 to 10,000 items.
The 52 new initiatives launched in 2019 translated to about 17,000 residential items, says Tricia Music, Colliers Worldwide’s head of analysis for Singapore.
Mega developments drive gross sales This year was important as 4 of the brand new initiatives have been “mega-developments” of greater than 1,000 items every, particularly Treasure at Tampines (2,203 items), Florence Residences (1,410 items), Parc Clematis (1,468 items) and Avenue South Residence (1,074 items). In 2020, there shall be no launches of such mega initiatives. The largest would be the EC at Tampines Avenue 10, with 695 items, notes Colliers.
Treasure at Tampines scored this yr when it comes to absolute variety of items taken up – 856 items which is 39% of its whole 2,203 items, the only largest personal condominium in Singapore to this point, notes Music. By way of share take-up fee, the best this yr was the 262-unit Sky Everton. About 68% of the items have been bought at a median value of $2,548 psf, as at Dec 20, based mostly on URA Reali information.
Built-in mixed-use developments additionally noticed strong shopping for demand, as an example Sengkang Grand Residences, the place 216 items or 32% of a complete 680 items have been snapped up on its first weekend of launch at a median value of $1,700 psf in November. At One Holland Village Residences, one other mixed-use improvement, about 37% of its 296 items have been bought since its launch on the finish of November, with costs within the vary of $2,600 to $3,200 psf, notes Colliers’ Music.
One other undertaking that stood out this yr was the 1,074-unit Avenue South Residence on Silat Avenue, simply off Kampong Bahru Highway. Launched in September, 437 items have been bought at a median of $1,951 psf as at Dec 20, translating to a take-up fee of 41%.
Each Sky Everton and Avenue South Residence benefitted from their proximity to the upcoming Larger Southern Waterfront, for which future plans for brand new developments and redevelopments have been unveiled in August.
Different initiatives the place gross sales benefitted from the federal government’s infrastructure initiatives embrace the 1,052-unit Affinity at Serangoon and the 1,410-unit Florence Residences. The primary section of 12 MRT stations on the Cross Island Line was introduced in January 2019. Because the announcement, Affinity at Serangoon has bought 360 items within the 12 months to date. That is on high of the 290 items bought in 2018, following its launch on the eve of the property cooling measures. In the meantime, The Florence Residences at Hougang Avenue 2 has bought 553 items or 39% of its whole variety of items because the undertaking was launched in Might this yr.
As for the 774-unit One Pearl Bank (former Pearl Bank), its city-fringe location and proximity to Outram Park MRT Station and the long run SGH medical campus have attracted buyers and residential patrons. About 251 items (32%) of the items have been bought since its launch in July, with common value of $2,386 psf, in response to caveats lodged as at Dec 20.
Prime properties to make up 40% of recent launches in 2020 Of the 52 initiatives launched in 2019, about 20 (or 38%) have been positioned in prime Districts 9, 10 and 11; with one other eight initiatives (15%) in prime District 15, the East Coast neighbourhoods of Amber Highway and Meyer Highway. Subsequent yr, 15 of the 37 initiatives (about 41%) are in prime Districts 9, 10 and 11, and solely two are in District 15 (see chart).
Then again, there shall be three EC initiatives launched subsequent yr, particularly the 548unit Ola, at Anchorvale Crescent; the 385-unit Parc Canberra; and the upcoming EC at Tampines Avenue 10. In distinction, just one EC was launched in 2019, particularly the 820-unit Piermont Grand at Sumang Stroll in Punggol.
The variety of new personal, non-landed residential items within the pipeline for launch is estimated to be round 8,900 items, which is simply over half of 2019’s, notes Colliers’ Music.
With new house gross sales at about 10,000 items this yr, and an anticipated 9,000 to 10,000 items subsequent yr, PropNex’s Ismail reckons that a number of the beneficiaries in 2020 shall be the sooner initiatives that have been launched in late 2017, 2018 and 2019 and nonetheless have unsold items.
Whereas property builders are involved in regards to the build-up in unsold stock which totalled 31,948 as at end-3Q2019, Ismail expects that they are going to be taken up inside the subsequent three to 4 years, assuming no new provide enters the market, and the annual absorption fee is regular at 9,000 to 10,000 items.
Initiatives on the radar of house patrons in 2020 “Most house patrons immediately are drawn to bigger initiatives as a result of they need full apartment amenities,” observes PropNex’s Ismail.
Some of the anticipated new launches subsequent yr is Leedon Green Inexperienced (the previous Tulip Backyard bought en bloc by a three way partnership between MCL Land and Yanlord Land) provided that it has a freehold tenure, has a main District 10 deal with and sits on a sizeable land parcel of 316,711 sq ft.
One other upcoming undertaking that shall be on the radar of house patrons is the 999-year leasehold KI Residences, a redevelopment of Brookvale Park by Hoi Hup Realty and Sunway Developments, with an estimated 660 items.
For websites bought by way of the federal government land gross sales (GLS) programme, these which might be on the radar of house patrons embrace the 378-unit Kopar at Newton, positioned at Kampong Java in prime District 11 by Chip Eng Seng Corp’s property improvement arm CEL Improvement; the 522unit The M on Center Highway by Wing Tai Holdings; and the GLS website on Tan Quee Lan Road by GuocoLand Singapore, which is prone to yield 560 items, and shall be linked underground to the Guoco Midtown built-in improvement throughout the street.
Luxurious market pushed by international patrons An attention-grabbing pattern this yr was the rise within the variety of international patrons within the Core Central Area (CCR) regardless of the hike in extra purchaser’s stamp responsibility (ABSD) to 20%. Worldwide patrons accounted for six% to 7% of the general house purchases in 2019 – which is analogous to the degrees in 2015 to 2017. Their illustration within the CCR jumped to 17% to 19% in 2Q2019 and 3Q2019, in comparison with 13% to 14% within the 2015 to 2017 interval, says Colliers’ Music.
Within the luxurious area, Boulevard 88 (former Boulevard Resort) is on the high with 87 items bought (56.5%) out of a complete of 154 items. Common value psf can be the best at $3,797 psf, based mostly on caveats lodged as at Dec 20.
Lots of the items have been picked up by Chinese language patrons, says Alan Cheong, senior director of analysis & consultancy at Savills Singapore. Different luxurious condos that benefitted embrace Three Orchard By-The-Park the place each penthouses have been bought by Chinese language patrons at report highs of $31.5 million ($4,805 psf) and $32 million ($4,638 psf) respectively, in comparison with the common of $3,622 psf for the everyday items.
The Marq on Paterson Hill noticed a 6,300 sqft unit on the 10th flooring bought for $29.5 million ($4,677 psf). It was the best in each absolute and psf phrases achieved within the freehold, 66unit undertaking since 2012. Different beneficiaries within the luxurious phase included the 156-unit Nouvel 18, the place 90% of the items bought went to international patrons, primarily Chinese language. Based mostly on the 18 recorded caveats, common value achieved at Nouvel 18 was $3,459 psf.
Apart from the wealthy Chinese language, Cheong sees an inflow of household workplaces of international highnet-worth people who have been beforehand positioned in Hong Kong.
Colliers’ Music expects costs for the total yr of 2019 to extend by about 2.5%, and is projecting a 3% enhance for 2020, “consistent with GDP progress”.
Regardless of the upper boundaries to entry within the type of larger ABSD since July 2018 and slower GDP progress in 2019, the Singapore personal residential market “demonstrated nice resilience and robust market liquidity”, says Christine Li, Cushman & Wakefield’s head of analysis for Singapore and Southeast Asia.