Sluggish start to 2024 ends in decade-high home sales at year’s end
In 3Q2024, brand-new home sales leapt 60% q-o-q, according to Huttons, which marked a change in view, which some credit to the 50-basis point rate of interest reduced by the United States Federal Reserve in September.
The initial project introduced after the Lunar Seventh Month was the 158-unit 8@BT at Bukit Timah Web Link. Over the weekend break of Sept 21– 22, 53% of its units were gotten at a standard price of $2,719 psf.
According to Chia Siew Chuin, JLL’s head of residential research, the sluggish functionality of the exclusive residential market in the first three quarters of 2024 developed an atypical year-end scenario. “Property developers, that had continuously delayed kick off as a result of financial unpredictabilities and hopes for enhanced conditions, finally rolled out ventures in November.”
More documentation of increased sales energy surfaced on Oct 5, the moment more than 50% of the 226 units at Meyer Blue were gotten in private sales. Units were transacted at an average cost of $3,260 psf, establishing a new measure for the prime District 15 enclave on the East Coast.
It started on Nov 6 with the open of the 367-unit The Collective at One Sophia, followed by the 366-unit Union Square Residences at Havelock Road on Nov 9. Momentum built up with the launch of the 916-unit Chuan Park on Nov 10, and it surged over the weekend of Nov 15-16 with 3 plans started jointly: the 846-unit Emerald of Katong, the 552-unit Nava Grove, and the 504-unit Novo Place exec condo (EC).
The 348-unit Norwood Grand in Woodlands also achieved several turning points. Over the weekend of October 19-20, it saw a take-up rate of 84%, reaching the very popular property in terms of percentage of sales as of October. The common price of units marketed was $2,067 psf, noting the very first time a project in Woodlands went beyond the $2,000 psf limit.
Developer revenues in November soared to 2,557 units– the strongest amount ever since March 2013, when 3,489 units were introduced and 2,793 were marketed, according to Huttons Data Analytics.
Speculation is today rampant about the possibility of further real estate cooling measures, provided the uncharacteristically high November sales. “While November’s sales numbers are remarkable, they provide an incomplete picture for predicting cooling measures,” Chia notes. “The marketplace excitement was largely generated by a year-end rush to release projects.”
Norwood Grand was the 1st brand-new private non commercial project released in Woodlands in 12 years. Its good performance was also a very clear sign of expanding purchaser assurance and need, according to Huttons’ Yip. It triggered a tidal upsurge of event in November with a record-breaking 6 new assignments making up 3,551 units unleashed over 10 days.
With cumulative brand-new home sales in 2024 likely to continue to be on a par with that in 2023, Chia considers regulatory intervention “unlikely”. Any intervention, she states, will rely on 2 factors: sustained sales drive into the initial quarter of 2025 and a simultaneous sharp surge in property costs outpacing GDP growth.
The property industry in 2024 unravelled in 2 starkly contrasting parts. The initial half was slow-moving, with store developments taking centre stage and the least variety of units released up for sale since 1H1996, according to Huttons Data Analytics. Sales quantity represented this trend, with just 1,889 units sold– the most affordable since 1996.
“Even with close checking by authorities, brand-new measures are most likely to stay on hold unless clear indicators of relentless market overheating arise,” Chia includes.
Chia states this absolute change from vigilance to action was triggered by the approaching year-end festive lull and enhanced market sentiment since the 3rd quarter of 2024. “The surge in activity has improved November into an unusually vibrant duration for property release, resisting the common seasonal slowdown and producing a dynamic industry setting.”
Yip notices that the dispatch of the 276-unit estate Kassia on Flora Drive around late July, that accomplished a 52% take-up fee, set the setting for strong sales energy following the Lunar Seventh Month.
The exemption was the 533-unit Lentor Mansion, that achieved a 75% take-up price throughout its release weekend in March. Most other work launches in 1H2024 observed reasonably lacklustre profits compared to 2023.
” Market sentiment was reluctant and careful,” mentions Mark Yip, Chief Executive Officer of Huttons Asia. “It could be because of uncertainties in the work market and constantly high interest rates. Purchasers were likely holding back, waiting for the extremely anticipated plan launches later on in the year, like Chuan Park and Emerald of Katong.”
The solid November productivity pressed total property developer transactions for the first 11 months of 2024 to 6,344 units. Year-end numbers are anticipated to exceed 6,500 units, exceeding the 6,421 units offered in 2023. “This mirrors the durability and strength of the property market,” says Huttons’ Yip. “It underscores the long-lasting demand of property as an investment for wealth production and preservation.”
