“No stock”. Well, that could be what some home hunters have been told repeatedly while they were out looking for a new property in 2022, especially in the suburban areas (also known as the Outside Central Region or OCR).
The overall unsold stock of new private homes has hit a record low this year – falling to just over 14,000 units in Q1 2022 (see Chart 1). The unsold supply picked up slightly in the latter part of the year, coming at 15,677 units as at Q3 2022. Of these, only 3,417 unsold units are in the OCR.
Meanwhile, the average OCR new home sales on an annual basis over the last 5 years (2017-2021) is about 4,900 units – which suggests that there is a supply and demand imbalance in the OCR.
Chart 1: Unsold inventory of new private homes remains low as at Q3 2022
Source: PropNex Research, URA
Pent-up demand for new launches
Given the limited number of new launches in 2022 and the tight unsold inventory, many buyers are eagerly anticipating the fresh projects that will come on this year. PropNex estimates that there may be some 12,000 residential units (incl. ECs) from over 40 projects that could hit the market in 2023 (see Table 1).
The Rest of Central Region (RCR) is expected to lead new launches this year, with about 5,200 residential units in the pipeline. This is followed by the OCR which has some 4,400 units lined up. First-time home buyers and HDB upgraders would be keen on projects in these sub-markets.
Meanwhile, about 2,500 new private homes in the Core Central Region could be added to the stock – potentially attracting interest from foreign buyers, particularly those from China, as the country steers away from its zero-Covid policy and relaxes its pandemic measures.
Table 1: Estimated number of new private homes (incl. ECs) to be launched in 2023
Source: PropNex Research, PropNex International
What’s lined up for Q1 2023?
Typically, in a project launch, certain apartment types – ranging from 1-bedder to 2- and 3-bedroom units – tend to sell out first, owing to their lower price quantum compared to larger units. In addition, the most attractive units in the stack, with good facing and desirable attributes also tend to be sold at the earlier stage of a project launch. That leaves fewer options for would-be buyers, and the as-yet-unsold units may not fit their budget as well since the balance stock could be larger homes.
Hence, many buyers who missed out on their choice units in previous launches will no doubt be eyeing suitable apartments in the upcoming launches in Q1 2023 (see Table 2). Those who are keen on the OCR can explore options at Sceneca Residence in Tanah Merah, Lentor Hills Residences in the new Lentor private housing enclave, as well as The Botany @ Dairy Farm, near the Bukit Timah Nature Reserve.
Sceneca Residence will kick things off and the project is expected to see strong interest. Some of its stand-out points include having the Tanah Merah MRT station right at its doorstep, the convenience of having commercial offerings at first storey of the development, and its proximity to the Changi Business Park and Changi Airport, which is set for further expansion.
Table 2: Potential new launches* and estimated number of units in Q1 2023
Source: PropNex Research, PropNex International
(*Excludes projects with fewer than 100 units within the development)
Meanwhile, a sizable RCR project could hit the market in Q1 2023. The Reserve Residence – part of a large integrated development – in Jalan Anak Bukit will offer an estimated 740 new homes. This project is seen as a key catalyst to drive the rejuvenation of the Beauty World area.
Over in the Core Central Region (CCR), two redevelopment projects TMW Maxwell and 8 Shenton Way could be launched during the quarter. Both projects are conveniently located within walking distance to the MRT station and numerous amenities. They may appeal to owner-occupiers who wish to live in the city centre, as well as property investors - both local and foreigners.
Speak to PropNex’s real estate salespersons to find out more about the new launches and to register your interest.
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Disclaimer:
While every reasonable care is taken to ensure the accuracy of information printed or presented here, no responsibility can be accepted for any loss or inconvenience caused by any error or omission. The ideas, suggestions, general principles, examples and other information presented here are for reference and educational purposes only.
This information contained herein is not in any way intended to provide investment, regulatory or legal advice or recommendations to buy, sell or lease properties or any form of property investment. PropNex shall have no liability for any loss or expense whatsoever, relating to any decisions made by the audience.
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