January 2010 saw a total 1,476 private residential units sold. Whether one sees it as almost 1400% more than were sold in January 2009, or that the figure is over 300% more than the figure in December, it is still an impressive number. And the fact that the number of units sold exceeds the number of units launched is an indication that this demand is set to continue into 2010.
“The middle to high-end markets are certainly moving,” observes PropNex CEO Mr Mohamed Ismail. “76% of the properties sold were above a median price of $1,000psf, a statistic not seen for over thirty months.”
He feels that this trend will continue well into 2010 for two reasons: one being that the focus is shifting to the middle to high-end markets, and secondly because the median prices for the mass market properties are also likely to breach the $1,000psf mark.
This assumption is based on the selling prices of the two recently sold plots of land at Serangoon Avenue 3 and Upper Thomson Road, which were both well above $500psf.
“So factoring in this land cost, an additional $270psf for construction costs, and all other related costs including the developers’ profits, we could see a $1,000psf selling price benchmark for 2010,” he explains.
“It is worth pointing out that only four projects launched over 100 units each in January 2010,” he adds, referring to Cube 8, RV Edge, The Shore Residences and Urban Suites, “and all of them had a median price of over $1,000psf.
“In fact,” continues Mr Ismail, “Urban Suites is a high-end project and it sold 88 units at a median $2,506psf.”
Incidentally, the four projects that launched over 100 units each also chalked up the most sales in January, accounting for 33% of the total sales for the month.
“There is no doubt that we are now firmly ensconced in an investor’s market,” states Mr Ismail. “And we can see developers are already starting to realise this with a slew of projects that have recently been launched or that will be launched very soon,” he says, referring to projects such as Altez, Centennia Suites and The Estuary.
Mr Ismail expects prices of private residential properties to maintain their buoyancy, given that many of the new developments that are going to be launched soon have median prices of between $1,000psf to over $3,000psf. For those who are on a budget, The Estuary in Yishun offers prices of around $850psf.
“Traditionally, January is a slow month,” reveals Mr Ismail, and the economy last January was still in a slump. Still, for January 2010, PropNex witnessed almost 5 times the number of private property resale transactions Y-on-Y, which is a remarkable exception.
“February might see a dip in the number of sales, given the typical lull for Chinese New Year,” he continues, “but the rest of 1H10 should see similar sales figures to those in January 2010.”
Based on the current demand and new land purchases, Mr Ismail expects prices to hold and feels that they are unlikely to dip anytime in 2010. Therefore, he advises prospective buyers to buy now and not wait for prices to fall. However, he cautions all buyers to buy within their means and avoid speculative views, purchasing any property with a mid to long-term view.
For enquiries, please contact:
Mohamed Ismail (CEO) 9487 1414
Adam Tan (Corporate Communications Manager) 9006 8726