New home sales in June was the highest in seven years as the private residential market recovers at a faster pace, after posting a surprise rebound in the preceding month. According to the developers’ sales survey by the Urban Redevelopment Authority, new home sales surged 104.9 per cent from 487 units in May to 998 units in June, rising faster than the 75.8 per cent month-on-month (m-o-m) increase in May (see Table 1). Including executive condominiums (EC), sales jumped 102.2 per cent from 510 units to 1,031 units over the same period, surpassing the 74.1 per cent m-o-m increase in May. The 998 new homes transacted in June 2020 was the highest monthly sales for June since 2013 (1,806 units excluding ECs).
Last month’s sales volume increase was broad-based across all market segments. The number of new homes excluding ECs transacted in RCR rose 127.5 per cent m-o-m to 430 units in June, while those in OCR increased 90.3 per cent to 489 units and CCR rose 92.7 per cent to 79 units (Chart 1) over the same period. The best-selling projects in June were Treasure at Tampines (104 units), Parc Clematis (90 units), The Florence Residences (89 units), Parc Esta (82 units), Stirling Residences (74 units), Jadescape (56 units) and The Tapestry (41 units). Kopar at Newton remained as the top-selling project in CCR with 25 transactions in June, while other luxury projects like Royalgreen, Fourth Avenue Residences, Leedon Green, Van Holland, Boulevard 88 and The Avenir continued to move units despite the ongoing pandemic.
Sales picked up further after showflats were allowed to reopen after the circuit breaker period which ended last month. While new homes continued to be sold during the circuit breaker period, some buyers prefer to visit the physical showflats to have a better visualisation of the unit layouts and floor plans, while others would want to assess the quality of furnishings and fittings featured in the mock-up units.
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The reopening of showflats saw a substantial increase in pricier private homes being sold last month. According to URA Realis data downloaded on 15 July 2020, the number of private homes excluding ECs transacting at S$2 million and above rose from 23 units in May to 129 units in June (Chart 2). In terms of proportion to the total sales (excluding ECs), 13.0 percent of new homes were transacted at S$2 million and above in June, when compared to 5.0 percent in May. 32 private homes were transacted at S$3 million and above. 2 new homes were sold above S$10 million including a 257 sqm 5th floor unit at Boulevard 88 that was transacted for $10.2 million or S$3,680 psf, and a 504 sqm 12th floor unit at 15 Holland Hill that was sold for $15 million or S$2,765 psf last month.
Foreign buyers returned to the market after the Circuit Breaker period. According to URA Realis data downloaded on 15 July 2020, the number of non-landed homes bought by foreign buyers increased substantially last month. 49 non-landed private homes were bought by non-permanent residents (NPR) in June, a steep increase from the 14 units transacted in May and 7 units in April (Chart 3). This is also higher than the 33 units transacted in June 2019. The number of non-landed homes bought by Singapore permanent residents (PR) has also surged from 56 units in May to 120 units in June, higher than the 86 units sold in June last year.
Many foreigners have bought properties last month as the growing macro-economic uncertainties have driven more overseas investors to seek shelter for safe-haven assets here. Although showflats were reopened last month, we have observed more foreign buyers purchasing private homes remotely due to the border lockdowns or travel restrictions imposed in many countries. This is in stark contrast to the past where many foreigners typically buy a unit only after visiting a showflat.
Currently, many foreigners snapped up homes in Singapore based on their trust in our legal system, quality of finishes and investment potential of properties. We may expect more foreigners to pick up private homes in the coming months as the interest rates are expected to remain low and ample liquidity is flowing into the asset markets due to the massive quantitative easing programs launched around the world.