It was another quiet month in November.
Developers launched 319 units and sold 259 units in November. Sales in November are down by 17.3% month-on-month. The absence of major launches, extremely low unsold stock in the market and buyers travelling overseas were key reasons behind the drop in sales.
This is even lower than the sales in Apr 2020 where the circuit breaker was imposed. The level of launched but unsold stock in November stood at 2,166 units.
On a year-on-year basis, sales in November 2022 plunged by 83.3%. This is largely due to the absence of major launches in November 2022. In November 2021, the market had 3 launches – CanningHill Piers, The Commodore and Cairnhill 16 whereas in November 2022, there were 2 boutique launches – Hill House, Kovan Jewel, Sanctuary@Newton and Sophia Regency.
The Core Central Region (CCR) continued its hot streak in November. Transactions in the CCR was 148 units, making up 57.1% of transaction volume in November. The proportion of sales in the CCR is the highest since Dec 2009. In Dec 2009, the proportion of sales in the CCR stood at 60.5%.
The top 5 projects with sales to foreigners in November are mainly in the CCR.
Top 5 Projects with sales to foreigners in November 2022
While the locals were travelling overseas for holidays, foreigners travelled to Singapore to pick up a home. This pushed up the proportion of foreigners buying a residential home in Singapore to 19.7% in November. It is the largest proportion since September 2011 where foreigners made up 20.2% of total purchases. A level 2 unit in Les Maisons Nassim was sold to a foreigner in November for $36 million while the 3 sales at Park Nova all went to foreigners.
Proportion of Purchase by Foreigners
The proportion of sales $2 million and above made up 54.4% in November. The percentage of sales below $1.5 million fell to 10% even lower than October’s level. There are limited unsold units below $1.5 million and the price point of projects in the market has moved above $1.5 million.
Purchases by Residential Status and Price Range in November
Top 10 Projects by Sales in November
Tenet, an EC was launched for sale on 3 December. It was another excellent launch day sales for the third EC launch in 2022. Tenet, located in the mature estate of Tampines sold more than 70% of its units on launch day. Being the last major project launch in 2022, it caps off another good year for the property market.
The strong response to Tenet is not surprising as it is in a mature estate and close to the future integrated mixed-use development at Tampines North along the Cross Island Line. Buyers of EC projects have two distinct advantages – upfront remission of ABSD and option of deferred payment scheme.
Huttons estimate there are 17 private residential project launches and 3 EC launches in 2022. The number of units launched for sale in 2022 may be between 4,500 and 5,000 which is the lowest ever. This is less than half of 2021’s 10,496 units launched for sale. Sales volume in 2022 is thus constrained to not more than 7,500 units because of the record low supply of new units. Private home prices may increase up to 10% in 2022, similar to 2021.
The supply of new homes will pick up in 2023 to an estimated 10,000 to 12,000 units spread over 40 launches. Based on the estimated units, 20% are in the Core Central Region, 50% in the Rest of Central Region and 30% in the Outside Central Region.
Several of the major project launches in 1Q 2023 should be well-received by the market. They include 8 Shenton Way, Blossoms by the Park, Jalan Tembusu, Lentor Hill Residences, Marina View, Newport Residences, Sceneca Residences, Terra Hill, The Botany at Dairy Farm, The Continuum, The Hill@One-North and The Reserve Residences. Sceneca Residences will be launched for sale in January. This will be followed by Blossoms by the Park, The Botany at Dairy Farm and Terra Hill.
The first major launch in 2023 will be Sceneca Residences. This is a mixed-use development that has a direct link to Tanah Merah MRT Interchange station. Based on the indicative prices, it will probably be the only mixed-use development that offers buyers the rare opportunity to buy a 1-bedroom below $1 million.
With low levels of unsold stock, the market is likely to be resilient in 2023 with up to 10,000 new home sales. Prices are expected to increase up to 5% in 2023.