Real Estate DataTrend Singapore Residential Update Primary private home sales monthly October sales data released by Urban Redevelopment Authority Primary home sales increased to 1,058 units in October Developers sold a total of 1,058 units in October according to the latest URA data. This marks a 16% m-o-m increase in volume from the 911 units sold in October. Sales in the Core Region has increased to of total compared with 9% in the previous quarter as launches in the Core Region picks up pace. This was in line with our expectations as we have flagged out the possibility of an upturn in CCR sales in our September report. However, in November we expect sales activity to swing back to OCR due to the pending or ongoing launches of large projects like the Lakefront Residences and Waterview. Best selling projects The Glyndebourne (freehold, 150 units) was the best selling private residential project in the month. A total of 112 units was sold as at end October 2010 at a median price of $2,149psf. In terms of units sold, NV Residences was the next best selling project with another 80 units being sold which brings total sales to about 68% of total units being sold. Another observation was the strong sales of small projects : Suites@Sims sold 48 out of 48 units in the project at $1,232 psf while RV Point saw 35 of 36 units sold at $1899 psf. This could suggest investment demand is returning on the back of available credit and liquidity. Exhibit 1: Units sold by region Outside, Rest of, Core, Marked improvement in sentiments Market sentiments have rebounded visibly since September. This upturn in sentiment is likely to persist into November based on the initial response to launches in the first 2 weeks of November. Projects like the Lakefront Residences, Spottiswoode Residences and Robinson Suites have reportedly gathered very strong take-ups despite being priced at the higher end of market expectations. This could spearhead another round of accelerating property launches in early 2011. Liquidity and strong economy While the Government might try again to cool down market sentiments, the environment remains conducive for property investment in Singapore. Investment demand is being fuelled by a combination of low interest rate and a resilient rental market, with occupancy at 94% as at the 3rd quarter. In the meantime, owner-occupier demand is aided by the strong wealth creation cycle with strong economic growth (expected to reach 13- in 2010), low unemployment rate (2.1% in 3 rd quarter) and a booming stock market (the STI has increased by 11.42% year to date). Together these are likely to continue to support property sales in the coming months, barring externalities. Thus, we expect total primary sales to reach between 13,000-14,000 for full year 2010. OrangeTee Research & Consultancy To receive regular news or research reports from OrangeTee, you can contact your servicing agent or email us at Research@OrangeTee.com 1 P a g e
Key Statistics by Region Overall median prices increased by 2.0% m-o-m Overall median prices increased by 2.0% in September, following the 0.8% increase in the previous month. Median prices in the Core Region registered an increase of 7.5% in October, a reflection of the higher end pricing achieved by launches in the CCR. In the meantime, prices of units sold in Rest of Region and Outside Region decreased slightly by 1.5% and 0.4% respectively in the month. This was mainly due to the lack of new launches in the month in these 2 regions. Exhibit 2: Average prices of units sold (in S$psf), by region New launches in CCR pushing up prices The price gap between new projects in the RCR and OCR compared with prices in CCR has widened to 37% (from ) and 52% (48%) respectively which is still below the average of 38% and 54% over the past 4 years. Despite this, there is still room for high end prices to grow as prices in the CCR is still below the last peak. Exhibit 3: Price gaps narrowing between CCR and the other regions 0% - -20% -30% -40% -50% - -70% -80% Price Gap - RCR vs CCR Price Gap - OCR vs CCR 2 P a g e
Oct-07 Dec-07 Feb-08 Apr-08 Jun-08 Aug-08 Oct-08 Dec-08 Feb-09 Apr-09 Jun-09 Aug-09 Oct-09 Dec-09 Feb-10 Apr-10 Jun-10 Aug-10 Oct-10 9% 21% 20% 27% 36% 21% 19% 14% 12% 8% 11% 34% 33% 37% 19% 38% 18% 17% 17% 12% 9% 53% 49% 33% 50% 16% 34% 28% 27% 38% 30% 22% 57% 35% 36% 48% 40% 42% 18% 77% 24% 52% 46% 63% 53% 63% 65% 66% 54% 42% 49% 35% 51% 28% 22% 24% Singapore Residential Rebound in launches in CCR After almost 6 months of lull, launches in the CCR have rebounded with a corresponding increase in sales. Projects like The Glyndebourne and the Suites at Orchard have met with strong sales with prices at the higher end of market expectations. This could be a pre-cursor to more launches in the high end market in early 2011. The market is expecting projects like the 1,715 unit D Leedon to be launched in 1st half 2011 which will be the true test of market demand for the high end. In November, market activity is likely to swing back to the OCR with several launches or preview already ongoing. Large projects like the Lakefront Residences (99 year, 629 units) and Waterview (99 years, 696 units) are in the process of preparing for launch or have been launched and could continue to provide upside surprises to the market in terms of pricing and sales. Exhibit 4: Number of units sold in the month, by Region Exhibit 5: Proportion of units sold, by Region 100% Unit sales composition 90% 80% 70% 50% 40% 30% 20% 0% Core Region Rest of Region Outside Region 3 P a g e
Most active sales in the month The Glynebourne was the best selling private residential projects in the month with 112 units sold, out of 150 units that were launched. This was despite being priced at the higher end of market expectations at $2,149 psf. In terms of number of units sold in the month, NV Residences continue to perform well, selling another 80 units in the month at an average price of $831 psf. This brings the total sales at NV Residences to 418 units or 65% of the total project. Small apartments continue to find favour amongst buyers as shown in the sales of Suites@Sims (sold 48 out of 48 units @ $1232psf) and RV Point (35 of 36 units @ $1899 psf). This suggests that investment demand might be returning. Other than private properties, the contrasting take up of 2 Executive Condominiums that were launched in the month highlights the point that buyers are now more selective. The relatively better located project, The Esparina, sold 425 units out of 573 units launched (74%) at a median price of $761 psf while The Canopy sold only 104 units out of 406 units launched () at a median price of $658 psf. On the whole, the sales in October reaffirms our stance that underlying demand remains strong and will continue to be supported by the low interest rate environment and continued strength of economic growth. Projects that are well located and near good amenities are likely to continue to sell well. Exhibit 6: Projects with the most number of units sold in the month Project name Address Developer Total THE GLYNDEBOURNE NV RESIDENCES Dunearn Road Pasir Ris Grove Copthorne Orchid Hotel Singapore Pte Hong Realty (Private) Limited units Cumulative sold to date Units launched in the month Units sold in the month Median price (S$psf) Units launched in August Units sold in August Median Price in 150 112 150 112 2149 - - - August (S$psf) 642 418 100 81 831 380 347 859 SUITES AT ORCHARD Handy Road Allgreen Properties 118 80 118 80 2,140 - - - THE LANAI Hillview Avenue Hong Moh Properties Pte 214 77 111 77 1,295 - - - VACANZA @ EAST Lengkong Tujoh/Jalan Senang Hoi Hup Sunway Property Pte 473 166 144 77 1,081 144 89 1,107 KOVAN GRANDEUR Tampines Road Fragrance Properties Pte 74 53 74 53 1,090 - - - SUITES @ SIMS Sims Avenue Macly Pte 48 48 48 48 1232 - - - RV POINT River Valley Road Galaxy Land Pte 36 35 36 35 1,899 - - - CITYSCAPE AT FARRER PARK Mergui Road Mergui Development Pte 250 32 75 32 1,470 - - - CITYVISTA RESIDENCES Peck Hay Road PH Properties Pte 70 70 0 30 1,809 0 4 1,968 WATERFRONT GOLD D'MIRA THE SHORE RESIDENCES Bedok Reservoir Road Boon Teck Road Amber Road FCL Peak Pte 361 224 0 22 985 0 8 978 MCL Land Development Pte 65 62 0 22 1,080 33 18 1,106 Dover Rise /Whitewater 408 307 0 21 1,296 70 6 1,362 SILVERSEA Marine Parade Road Marina Green 383 239 50 18 1,721 0 9 1,517 OASIS @ ELIAS Elias Road CES Land Pte 388 315 22 17 713 0 20 705 4 P a g e
Exhibit 7 : Map of Core Region Note The Urban Redevelopment Authority releases statistics that are grouped by Core Region (CCR), Rest of Region (RCR) and Outside Region (OCR). The shaded areas in the map above show the CCR which comprises of prime districts 9, 10, 11, Downtown Core and Sentosa Cove. RCR refers to the Rest of Region, which comprises of area within the Region that is outside CCR. OCR refers to Outside Region which comprises of the rest of the area in Sing apore that is outside the CCR and RCR. Terms of use: This report is provided for general information only and should not be treated as an invitation to buy or sell any property or as sales material. Users of this report should consider this report as a one of the many factors in making their investment decision. Users should make reference to other sources of information and specific investment advice to obtain a more objective view of the property market. OrangeTee shall not be responsible for losses suffered. 5 P a g e