By Lynda Hong | POSTED: 16 Oct 2013 14:01 | UPDATED: 16 Oct 2013 23:35 | CNA

SINGAPORE

Developers sold 65 per cent more new private homes in September compared to August, according to data from the Urban Redevelopment Authority (URA).

Excluding executive condominiums, 1,246 units of new private homes were sold in September, up from 756 in August as developers returned to the market with new launches after the Hungry Ghost Festival.

September’s new private home sales is the highest since loan curbs under the Total Debt Servicing Ratio (TDSR) Framework was introduced in late June.

But on a quarterly basis, analysts noted that total sales of 2,484 for the third quarter of 2013 has been the worst since the fourth quarter of 2009.

Ong Teck Hui, national director of Research and Consultancy at Jones Lang LaSalle, elaborated: “We were expecting sales figures of about 1,000 for September. So 1,246 is higher than expectations. But it is not indicative of a recovery in the market.

“The effect of the TDSR is still being felt in the market. For Q4 (fourth quarter), we could see sales ranging from 2,000 to 3,000 for that quarter. It could be in the same range as in the third quarter, and that would not be indicative of a recovery.”

New condo sales in the city fringes or Rest of Central Region (RCR) led the rise, with 815 units sold last month.

Meanwhile, demand for units in the city or Core Central Region (CCR) fell by nearly half compared to August, with just 49 transactions.

The number of new condo units sold in the suburbs or Outside Central Region (OCR) was a third less than in August, at 382 units.

Analysts said the improved sales were due mainly to the launch of Sky Vue and Thomson Three in the city fringes.

Ku Swee Yong, chief executive officer at Century 21, said: “Sky Vue in Bishan has also probably set a new record price for the Bishan area, and that is at above S$2,000 psf (per square foot). While we expect CCR and OCR to show some price weakness, the fact that these two projects sold very well, as well as Sky Vue having set a new record price. We think RCR index for the full quarter might go up significantly.”

With tighter loan curbs now, analysts expect first time home buyers and upgraders to form the bulk of sales going forward.

This is because they generally do not have other debts and so should be able to secure the full 80 per cent of bank loans.

However, affordability remains a key issue for many potential home buyers.

Analysts said developers building smaller units in favourable locations would help move new sales.

But they added that while prices of such new units may seem cheaper, this may actually translate to higher costs on a per square foot basis.

– CNA/fa/gn

http://www.channelnewsasia.com/news/singapore/new-private-home-sales-up/849260.html