Huttons’ comments on URA 3Q 2023 numbers

27 October 2023

The property market returned to growth in 3Q 2023 backed by strong sales in project launches. Property prices grew by 0.8% quarter-on-quarter (QoQ) in 3Q 2023 and 3.9% year-on-year (YoY). Compared to the last peak in 3Q 2013, property prices are 26.8% higher.

The cooling measures on 27 April 2023 had a greater impact on the Core Central Region (CCR) as the proportion of foreigners buying residential properties tends to be higher. Sales in the CCR plunged by around 20.8% in 3Q 2023 compared to the previous quarter. Prices have also dropped by 2.7% in 3Q 2023.

Prices in the Outside Central Region (OCR) jumped the most by 5.5% in 3Q 2023 while the Rest of Central Region (RCR) prices increased by 2.1%.

Developer sales
A total of 2,805 units across nine projects were launched for sale in 3Q 2023. The nine projects were Grand Dunman, Lentor Hills Residences, Orchard Sophia, Pinetree Hill, The Arden, The Lakegarden Residences, The Myst, The Shorefront and TMW Maxwell. This is the largest launch by units in a quarter since 1Q 2021.

Developers sold a total of 1,946 units in 3Q 2023 which is slightly lower than the previous quarter. In the first nine months of 2023, developers have sold 5,329 units, 16.9% lower than the corresponding period a year ago. The nine project launches accounted for 1,417 units or 72.8% of sales in the third quarter of 2023.

Figure 1: Developer’s New Sales Volume

Source: URA monthly developer sales, Huttons Data Analytics as of 27 Oct 2023

The top three bestselling projects in 3Q 2023 are Grand Dunman, Lentor Hills Residences and The Myst.

Being the one and only mega launch in 2023, Grand Dunman generated a lot of buzz and attracted about 10,000 people on the first weekend of preview. Grand Dunman sold 580 units in 3Q 2023, making it the bestselling project in 2023 and in more than two years. Lentor Hills Residences recorded strong sales, selling almost 400 units. The 1- and 2-bedrooms are the most popular due to investment demand and family sizes getting smaller over the years. The Myst sold more than 150 units, attracting owner occupiers who like the area for its proximity to nature, good primary schools and Cashew MRT station.

Table 1: Top Ten Bestselling Projects in 3Q 2023

Project Region Units sold Median Price
Grand Dunman RCR 580 $2,522 psf
Lentor Hills Residences OCR 393 $2,107 psf
The Myst OCR 151 $2,064 psf
Pinetree Hill RCR 147 $2,360 psf
The Lakegarden Residences OCR 71 $2,099 psf
The Continuum RCR 62 $2,761 psf
One Pearl Bank RCR 40 $2,824 psf
The Arden OCR 37 $1,777 psf
The Reserve Residences RCR 34 $2,532 psf

Source: URA, Huttons Data Analytics as of 27 Oct 2023

Resale Market
The resale market bore the brunt of the higher for longer interest rate in 3Q 2023. The higher interest rate led to a slight dip in prices of 0.6% in the resale market. Transaction volume in 3Q 2023 is 2.6% lower than the previous quarter as price sensitive buyers are priced out.

Figure 2: Resale Volume and Prices

Source: URA, Huttons Data Analytics as of 27 Oct 2023

The subsale market continued to see good demand in 3Q 2023 as it offers buyers the opportunity to move into a new home either immediately or in a shorter time compared to new sale. The substantial price gap of 20% to 30% between a new sale and sub sale unit which is drawing more buyers to this segment of the market.

Table 2: Breakdown of Private Residential Sales

Type of Sale

2020

2021

2022

1Q 2023

2Q 2023

3Q 2023

New Sale

9,982

13,027

7,099

1,256

2,127

1,946

Resale

10,729

19,962

14,026

2,622

2,976

2,900

Sub Sale

198

568

765

243

285

355

Total

20,909

33,557

21,890

4,121

5,388

5,201

Source: URA, Huttons Data Analytics as of 27 Oct 2023

Rents
There were 8,517 private residential units completed in 3Q 2023, 93.5% higher than 2Q 2023. In the first nine months of 2023, a total of 15,388 private residential units were completed. With little incremental demand to absorb the new supply of condos, landlords came under more pressure to retain tenants in 3Q 2023 and rents inched up by 0.8%. This is the slowest quarter growth in rents since 4Q 2020 and all segments of the residential market saw significantly lower increase in rents.

Buyer’s Profile
After the cooling measures, the proportion of foreigners purchasing residential properties in Singapore in 3Q 2023 more than halved to 1.7% compared to 4.0% a quarter ago. In 3Q 2023, US citizens are the number one foreign purchasers of residential properties in Singapore, followed by China citizens in second. Singaporeans and PRs made up a larger portion in 3Q 2023 as more buyers wait for either their PR or citizenship before buying a property in Singapore.

39.5% of the transactions in 3Q 2023 are priced below $1.5 million, 28.2% are between $1.5 million to $2 million and 32.4% above $2 million. More than 80% of purchases are by Singaporeans with PRs and foreigners making up 16.9% and 1.7%, respectively, in 3Q 2023.

The number of non-landed deals worth $10 million or more has more than halved from 20 in 2Q 2023 to 8 in 3Q 2023. In view of the higher taxes, some buyers have adjusted their budget.

Table 3: Comparison of Price Range and Residential Status (All Sale Types) in 3Q 2023

<$1.5 million

$1.5 to <$2 million

$2 to <$5 million

>$5 million

Total

Companies

2

0

1

3

6

Foreigners

17

15

36

14

82

Permanent Residents

407

169

189

30

795

Singaporeans

1,425

1,138

1,216

29

3,808

Total

1,851

1,322

1,442

76

4,691

Source: URA, Huttons Data Analytics as of 27 Oct 2023

Figure 3: Comparison of Nationalities among Buyers (All Sale Types)

Source: URA, Huttons Data Analytics as of 27 Oct 2023

Executive Condominiums
The only EC launch in 2023, Altura saw strong sales in 3Q 2023 and is close to 90% sold. There had not been an EC in Bukit Batok for 22 years and many buyers were looking forward to it. North Gaia, an EC in Yishun also saw steady sales in 3Q 2023.

Developers have sold 420 EC units in 3Q 2023, the highest sales volume since 4Q 2022. As of 3Q 2023, 319 launched EC units remain unsold in the market.

Market Outlook
Based on advance estimates, Singapore’s economy grew by 0.7% on a year-on-year (YoY) basis in 3Q 2023, faster than the previous quarter 0.5% YoY growth.

Property prices are likely to stabilise after the high growth over the past two years.

This is due to the uncertain economic outlook and higher for longer interest rates. Growth in employment and wages have slowed leading to more cautious sentiments. The higher for longer interest rate environment is providing investors alternative options to property investment while at the same time pricing out some buyers and limiting the price gains.

There will be another 4 project launches with a total of 1,048 units in the last quarter of 2023. This will bring launched units to an estimated 7,539 for 2023. This is less than the original forecast of up to 12,000 units launched for sale in 2023 but nevertheless 66.5% higher than the 4,528 units launched for sale in 2022.

Developer sales could end the year between 6,000 and 6,500 units as buyers turn cautious. Prices of new homes should trend higher by up to 5% in 2023 on the back of resilient demand.

In 1Q 2024, there may be another 11 projects with a total of 2,757 units slated for launch. 27% of the units are in the CCR, 16% in the RCR and the remaining 57% in the OCR. Barring unforeseen circumstances, prices are estimated to grow at a lower rate of up to 3% in 2024.

Table 4: Potential Upcoming Projects in 4Q 2023 and 1Q 2024

No. Project Name Developer Location

District

Tenure

Est Units

Est Launch Period

1 Mattar Residences L.K. Ang Construction Mattar Road

14

FH

26

Oct 2023

2 J’den CapitaLand Development Jurong East Central 1

22

99

368

Nov 2023

3 Hillock Green United Engineers, Soilbuild Group Holdings Ltd and Forsea Holdings Pte Ltd Lentor Central

26

99

474

Nov 2023

4 Watten House UOL Group Limited & Singapore Land Group Shelford Road

11

FH

180

Nov 2023

5 173 – 183 Haig Road Nanshan Group Haig Road

15

FH

35

1Q 2024

6 Former East Court Macly Group Koon Seng Road

15

FH

19

1Q 2024

7 Former Jansen Mansion Macly Group Jansen Road

19

FH

22

1Q 2024

8 Hillhaven Far East Organization and Sekisui House Hillview Rise

23

99

341

1Q 2024

9 Lentoria TID Residential Pte. Ltd. Lentor Hills Road

26

99

267

1Q 2024

10 Lumina Grand (EC) City Developments Bukit Batok West Ave 5

23

99

512

1Q 2024

11 Marina View Residences IOI Properties Marina View

1

99

683

1Q 2024

12 Sora CEL Development, Sing-Haiyi Pearl and TK 189 Development Yuan Ching Road

22

99

440

1Q 2024

13 The Arcady @ Boon Keng KSH Ultra Unity Pte Ltd Serangoon Road

12

FH

172

1Q 2024

14 The Hill @ one-north Kingsford Real Estate Development Pte Ltd Slim Barracks Rise

5

99

142

1Q 2024

15 The Hillshore Hillside View Development Pte Ltd Pasir Panjang Road

5

FH

59

1Q 2024

Total

3,805

* in alphabetical order followed by chronological order
Source: URA, Huttons Data Analytics as of 27 Oct 2023

Contact:
Lee Sze Teck
Senior Director, Data Analytics
(65) 9183-6367
[email protected]