Developers' Monthly Sales in Singapore for January 2022 | OrangeTee

The real estate industry might seem to be resilient throughout the pandemic, but there were some sectors that were impacted when taking a closer look. Here's how developers are performing in January 2022.

An Overview of Singapore's Developer Market

Although new cooling measures were introduced last year, the demand for new homes held steady last month. The cooling measures were implemented from December 16th in 2021, as prices of private residential homes and HDB resale flats were rising relentlessly for many months.

What property cooling measures were introduced in 2022?

The Additional Buyers’ Stamp Duty (ABSD) rates were raised, while the Total Debt Servicing Ratio (TDSR) was tightened. Moreover, the Loan-To-Value (LTV) limit for HDB loans was reduced as well.

According to the Urban Redevelopment Authority (URA) sales survey, developers sold 673 new private homes excluding executive condominiums (EC) last month, rising 3.5 per cent from December 2021 when 650 units were transacted.

Including ECs, new home sales rose 0.8 per cent from 719 units in December 2021 to 725 units in January 2022. On a year-on-year (y-o-y) basis, new sales excluding ECs decreased 58.8 per cent from 1,633 units in January 2021 to 673 units in January 2022.

Source: URA, OrangeTee & Tie Research & Analytics 

The high sales volume in January 2021 was an anomaly. From 2014 to 2020, the total new home sales excluding EC for the month of January ranged between 324 and 620 units.

Three major launches contributed to the high sales volume in January 2021 –

1. the 1,862-unit mega project at Normanton Park, which moved 645 units that month
2. the launch of the new EC project, the 700-unit Parc Central Residences, which sold 417 units and the 429-unit
3. The Reef at King's Dock, which sold 221 units.

In contrast, there were only two smaller project launches last month: the 107-unit Belgravia Ace and 16-unit Ikigai. Last month, 178 units (excluding ECs) were launched which was the lowest number of new homes launched since February 2021 (167 units).

Due to the absence of new launches, existing launches continued to pare down their unsold stock. Besides Belgravia Ace, other best-selling projects include Normanton Park, The Woodleigh Residences, Dairy Farm Residences, and The Florence Residences.

Most transactions (excluding ECs) were in the Rest of Central Region (RCR) at 42.9 per cent, followed by the Outside of Central Region (OCR) at 40.9 per cent, and the Core Central Region at 16.2 per cent.

Comparing the impact of Singapore's previous real estate cooling measures

Previous rounds of cooling measures seemed to have a greater impact on the new sale market. For example, after the implementation of new ABSD measures in January 2013, sales volume (excluding ECs) dropped by 64.9 per cent from 2,028 new homes sold in January 2013 to 712 units in February 2013. Sales dipped 70.5 per cent y-o-y from 2,417 units in February 2012 to February 2013.

Likewise, new home sales (excluding ECs) plunged 64.2 per cent from 1,724 units in July 2018 to 617 units in August 2018 after new cooling measures took effect on 06 July 2018. Sales dipped 50.5 per cent y-o-y from 1,246 units in August 2017 to 617 units in August 2018.  Comparatively, sales volume rose 3.5 per cent from 650 units in December 2021 to 673 units in January 2022.

After the introduction of new cooling measures, the proportion of permanent residents (PR) purchasing new condos dipped slightly from 13.5 per cent in December 2021 (83 units)  to 11.3 per cent (66 units) in January 2022. The proportion of PR purchases was 12.2 per cent in November 2021 (177 units). The proportion of new condos purchased by foreigners or non-permanent residents (NPR) remained healthy at 4.8 per cent in January 2022 (28 units), which was up from 3.6 per cent in December 2021 (22 units) and 3.8 per cent in January 2021 (60 units). 

Singapore's Developer Market Outlook

Developers are gearing up to launch more projects after the Chinese New Year festivities. As the dust settles after new cooling measures have been implemented for two months, some buyers may start to stream back to the market with more market clarity.  

Some potential launches may include the Piccadily Grand condominium at Northumberland Road jointly developed by City Developments Limited and MCL Land Limited and The Arden along Phoenix Road by Qingjian Realty. 

This article is written by Christine Sun, 孙燕清.
Senior Vice President of Research & Analytics (研究与咨询部总监)
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