According to the latest URA data, developers sold a total of 1,806 private residential units (excluding ECs) in June. Mass market homes in the Outside Central Region (OCR) continued to dominate new private home sales, with 81% of the total units sold last month coming from this market segment.
“June’s numbers indicated an exceptional performance especially with the quieter period during the June school holidays as people travel and are away. The strong performance was largely contributed to J Gateway, located right next to the Jurong East MRT station, that had all units snapped up within the same day during its preview with 737 units sold at a median price of $1,488psf. Most new projects have 50% of the entire development sold within the first 2 months, and for J Gateway, the pent-up demand was mainly due to the master plan development in Jurong and the excellent location, making it contributed 40% of the total new home sale in June,” remarked Mr Mohamed Ismail, CEO of PropNex Realty.
Jewel@Buangkok also performed well with 282 units sold at a median price of $1,183psf. Hot on the heels are Forestville (EC) sold 226 units at $730psf, Bartley Ridge moved 61 units at $1,229psf and Three 11 sold 57 units at $1,624psf.
“The latest new debt servicing framework introduced by MAS with loan interest rates pegged at 3.5 per cent, may prompt potential homebuyers to take a more discretionary view of home buying with the reduced affordability levels. It is a reasonable one in the current economic environment of low interest rates as this could prove calamitous if interest rates rose or if an economic downturn upset a family's overall financial calculations. By encouraging borrowers to be prudent - the new rules will contribute to financial stability in the long run”, explained Mr Ismail.
“As such, we expect sales volume to moderate M-o-M especially with the introduction of the TDSR. This tougher new rule on property financing is not likely to affect the private property prices as developers are not prepared to bring down prices immediately. I believe many potential buyers will likely adopt a wait-and-see attitude first before making a purchase decision. Also, developers are likely to be cautious in their pricing strategy to avoid hitting buyers’ price resistance level.”
“The full year forecast for new private residential home sales will range between 18,000 and 19,000 units sold, with the higher end of the figure being reached if GDP growth remains strong,” remarked Mr Ismail.
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