Improved confidence as launches and sales pick up

Sales and launch volumes

In September, developers sold 932 private residential units, a 51.1% increase from the 617 units sold in August and also 41.9% higher y-o-y. The increase was due to a pick up in new projects being launched that generated interest among buyers leading to more transactions.

An estimated 3,273 new private homes were sold in 3Q18 which is 38.3% higher than in the second quarter and 22.9% higher y-o-y. The robust sales in 3Q18 were due to the sudden launch of Stirling Residences, Park Colonial and Riverfront Residences to beat the commencement of the new cooling measures on 6 July which boosted sales significantly.

The 1,169 private homes launched for sale in September were more than double the 534 units launched in the previous month and sixteen times higher than the 73 units launched in September 2017. In 3Q18, an estimated 3,942 private residential units were launched for sale, 61.8% higher than the previous quarter and more than triple those launched in the same period last year.

New project launches

Seven new private residential projects came on to the market in September: 

Project	Total (units)	Launched (units)	Sold (units)	Median price (psf)
Cashew Green (landed)	19	11	3	$1,979
Bukit 828	34	17	9	$1,712
Jadescape	1,206	480	327	$1,669
Jui Residences	117	117	31	$1,704
Mayfair Gardens	215	100	82	$1,945
The Addition	26	26	10	$1,774
The Jovell	428	250	41	$1,259

Source: URA

Top selling projects

Project	Sold (units)	Median price (psf)
Jadescape	327	$1,669
Stirling Residences	89	$1,743
Mayfair Gardens	82	$1,945
Park Colonial	80	$1,751
Riverfront Residences	56	$1,320

Source: URA

Executive Condominium (EC) market

Only 12 new ECs were sold by developers in September as unsold supply dwindled in the absence of new launches. Median prices of ECs sold in a few projects ranged from $918 psf to $1,014 psf. There are now hardly any new EC units available for sale, until the Sumang Walk project is launched next year.

Mr Ong Teck Hui, National Director of Research & Consultancy at JLL commented:

“Market confidence seems to have improved with seven new private residential projects launched in September, achieving sales of 932 units during the month. The launch momentum builds on the four projects placed on the market in August which was affected by the Lunar seventh month. Post cooling measures, 12 projects were launched in a space of two months, which compares favourably with 24 launched in the first seven months of the year.

The 1,169 private homes launched in September is the highest number of monthly launches in 2018, not counting the 2,239 launched in July, which was a distortion due to the hasty launches on 5 July to beat the cooling measures. Awareness of the significant potential launch supply is prompting developers to continue putting their projects on the market to avoid a crunch in 2019, if launches are delayed.

While developers have become more confident in launching projects, they are still grappling in setting an appropriate price level to attract buyers. Those who do better in pricing (taking into account location and other attributes) manage to achieve better sales take-up, e.g. Mayfair Gardens and Jadescape. Even previously launched projects such as Stirling Residences, Park Colonial and Riverfront Residences are selling reasonably well at current price levels.

While it is early days to make a pronouncement of the full effects of the cooling measures, it would appear that while demand has slowed, many buyers are still on the market and are prepared to purchase at prices which they deem as reasonable. If the trend of launches can be sustained with fair sales take-up, market confidence is likely to improve and recovery from the cooling measures may be sooner than expected.”

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About JLL

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. Our vision is to reimagine the world of real estate, creating rewarding opportunities and amazing spaces where people can achieve their ambitions. In doing so, we will build a better tomorrow for our clients, our people and our communities. JLL is a Fortune 500 company with nearly 300 corporate offices, operations in over 80 countries and a global workforce of 83,500 as of March 31, 2018. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated.