SINGAPORE'S private residential property market has started showing some signs of life after several months in the doldrums, thanks in part to an easing of prices.
Last month, developers sold 441 new homes, excluding executive condominiums, a sharp 55 per cent jump on the figure for April - albeit a low base - of 284 home sales.
That made May the best month so far this year, according to the monthly sales figures released by the Urban Redevelopment Authority yesterday.
The improved sales came on the back of 474 new homes launched by developers - a 75 per cent surge over April - though many of the units sold were from earlier launches.
Still, consultants caution against reading too much into the latest figures. They say the market is generally still taking a breather, as many buyers prefer to stay on the sidelines.
Sales have improved from a very low base but they remained 32 per cent below the 12-month average, said Knight Frank's director of research and consultancy, Mr Nicholas Mak.
The figures 'do not necessarily imply that the private residential market has overcome the protracted lull sparked off by global economic woes', he said.
'The market is still at a plateau. Going forward, we will still see range- bound prices and volume of between 300 and 600 units a month. Sentiment is still very cautious,' he said.
Jones Lang LaSalle's head of research for South-east Asia, Dr Chua Yang Liang, said median prices have eased.
The chief executive of PropNex, Mr Mohamed Ismail, said that most May sales were done at a median price of below $1,000 per sq ft (psf), a stark contrast to the end of last year when the median price of almost two-thirds of all sales was over $1,000 psf.
'Upon closer scrutiny, we can see that less than 50 per cent of the units launched were actually sold.'
Also, slightly over half the sales were from earlier launches, he said.
Still, there are a few bright spots. While some are struggling to sell, developer Macly Group sold 72 out of 102 units of Vutton in the Novena area at $1,057 psf to $1,416 psf.
In the luxury market, the 100-unit Nassim Park Residences is the star performer, logging in sales of over 50 units since its soft launch at end-May.
As these are large apartments, prices range from about $10 million to a whopping $19.5 million, sources said.
The prime Nassim Road project - being developed by UOL Group, Kheng Leong and Orix Corp - has already hit a high of $3,800 psf - far better than its low of $2,318 psf.
One buyer is Mr Wee Ee Cheong, son of UOL chairman Wee Cho Yaw, who bought a penthouse for $18.33 million.
Just over 30 per cent of the buyers are foreigners. The project has already been launched in Jakarta and Hong Kong, said UOL.
Another luxury development Scotts Square in the Orchard area registered sales of four units at a median price of $3,818 psf last month.
The relatively strong sales in central Singapore were the result of 'latent demand spurred on by softening prices', said Dr Chua.
'Going forward, we reckon that developers are likely to keep prices competitive to keep the market demand stable,' he said. As long as prices remain affordable, price-sensitive buyers will return, he added.
Savills Singapore's director of business development and marketing, Mr Ku Swee Yong, said the level of transactions and price levels seen last month are sustainable.
This article was first published in The Straits Times on Jun 17, 2008
