Residential sales briefing

Transcription

1 Singapore February 12, 2010 Near record high sales of private new homes, coupled with a strong price recovery in the second half of 2009, marked the end of the property downturn. Total transaction volume in 2009 was more than double 2008 s level. New home sales were just a shade off the 2007 peak. A resurgence in residential land acquisitions was recorded in 2H/2009 on the back of recovering confi dence. High-end residential prices rose by 3.9 per cent yearon-year, whilst super-luxury residential prices are still 0.5 per cent lower than one year ago. The Government Land Sales Programme posted 26 residential sites for 1H/2010 High-end homes are poised to take centre stage in 2010 after lagging behind their mass and mid-tier counterparts in Image: Gardenvista on Dunearn Road Savills Research

2 Market Overview Although the Singapore economy suffered a year-on-year contraction of 2.1 per cent, the local private residential property market charted a different course in 2009 which caught many observers by surprise. According to the Urban Redevelopment Authority s (URA) record of lodged caveats, there were a total of 31,249 1 transactions for the whole of 2009, representing a per cent increase compared with the previous year. Among these, about 6,929 transactions or 22.2 per cent were made by foreigners. Buyers from Malaysia, Indonesia, China, India and the United Kingdom made up about two thirds of these transactions. Total Number of Transactions and Foreigner Purchases, Transactions 45,000 40,000 35,000 30,000 25,000 Q1 Q2 Q3 Q4 (LHS) % of Foreigner Purchases (RHS) 20,000 8,507 12,122 3,248 14,607 15,000 5,022 4,165 5,731 1,884 2,697 10,000 2,464 3,461 3,619 2,406 5,173 4,550 3,588 9,315 4,147 2,952 5,796 3,876 5,000 3,191 4,020 2,871 8,453 6,809 2,973 4,097 2,703 3,218 4,325 2,171 1,418 2,493 2,619 3,431 3, Despite an uncertain economic outlook and a slew of government measures to curb overheating and speculation, the primary market saw a near record high of 14,688 new home sales in This is only 123 units less than the 14,811 sold during the peak of the last property upturn in By region, the highest number of sold units came from the mass market in Outside Central Region (OCR) with about 6,060 units or 41.3 per cent of the total number of units sold, followed by the mid-tier market in Rest of Central Region (RCR) (33.2 per cent) and the high-end market in Core Central Region (CCR) (25.5 per cent). The resurgence in new home sales was largely attributed to greater affordability fuelled by declining interest rates, attractive fi nancing schemes and smaller-size apartments. At the same time, the global economic crisis of 2008 had sent private residential property prices tumbling, making them more affordable to a wider market. Consequently, this drew an infl ux of public housing upgraders to the mass market in the 1H/2009, triggering an extraordinary uplift in demand for the mid-tier and high-end properties as seen in the last couple of months. Even though prices have bottomed out with some having returned to pre-crisis levels, demand remained fi rm in Q4/2009, especially in CCR. 10,186 1 Based on the caveats from the URA Realis system as at 3rd Feb , % 25% 20% 15% 10% 5% 0% Launches of several high-end projects, such as Lincoln at Khiang Guan Avenue, Marina Bay at Central Boulevard, Parvis at Holland Hill, Trilight at Newton Road and Urban at Hullet Road, were well received. As a result, in terms of new sales, CCR outsold RCR and OCR for three consecutive months from October to December. Major New Launches in CCR, Q4/2009 Project Name Adria Cyan Espada Lincoln Marina Bay Location Tenure Total Derbyshire Road Bukit Timah Road/Keng Chin Road St. Thomas Walk Khiang Guan Avenue Central Boulevard Launched Sold Price (S$/sf) Freehold ,463-1,655 Freehold ,712-2,003 Freehold ,170-2,673 Freehold ,530-2, years ,826-2,623 Parvis Holland Hill Freehold ,193-1,695 Trilight Urban Newton Road Freehold ,639-1,842 Hullet Road Freehold ,180-2,765 After four sites under the Government Land Sales (GLS) Programme were sold in Q3/2009, another two sites from the Reserve List were triggered and sold in the reviewed quarter. A non-landed residential site located along Upper Thomson Road was awarded to Treasure Well Investments Limited, a unit of Cheung Kong Holdings, at a top bid of S$251.3 million or S$533 per sq.ft. per plot ratio (ppr). The other landed residential site located along Jurong West, which attracted a whopping total of 32 bids, was awarded to Chappelis Pte Ltd, a unit of Kheng Leong Group, with a top bid of S$38.5 million or S$254 per sq.ft. This has brought the number of awarded state sites up from zero in 1H/2009 to six in 2H/2009. The private market also saw two significant deals in Q4/2009. The fi rst and only collective sale in 2009 was Dragon Mansion, a 42,000-sq.ft. freehold residential site located on Spottiswoode Park Road, which was sold to developer Roxy-Pacifi c for S$100.8 million or S$863 per sq.ft. ppr. The 39,972-sq.ft. freehold Mitre Hotel site at Killiney Road was bought by a consortium led by Heeton Holdings for S$121 million or S$1,080 per sq.ft. ppr for residential development. These deals reflect the developers keenness to replenish their land banks and their confi dence in the mid-tier and high-end market segments. Over 200 offices and associates throughout the Americas, Europe, Asia Pacific, Africa and the Middle East. 2

3 Prices URA s island-wide private residential price index was at the end of 2009, up from in Q3/2009. Although the quarter-on-quarter growth moderated to 7.4 per cent, the index edged higher by 1.8 per cent for the whole of 2009, but was still 6.6 per cent below the previous peak in Q2/2008. According to Savills data, the average prices of high-end and super luxury residential which bottomed in Q1/2009 have consistently improved each quarter thereafter. As a result, the high-end residential price was S$1,965 per sq.ft. at Q4/2009, up 4.1 per cent quarter-on-quarter and 3.9 per cent year-on-year. The super luxury residential price rose 4.5 per cent from S$2,883 per sq.ft. in Q3/2009 to S$3,013 per sq.ft. in Q4/2009, which is only 0.5 per cent lower than a year ago. Average Prices of High-end and Super Luxury Nonlanded Residential, S$ per sq.ft. 4,000 3,500 3,000 2,500 2,000 1,500 1,000 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q Source: Savills Research & Consultancy Future Supply High-end Residential Super Luxury There were a total of 66,426 private residential units in the pipeline at end of Of these, 33,760 units (50.8 per cent) are under construction, whilst 32,666 units (49.2 per cent) are at the planning stage. The completions in 2010 have been revised upwards for two successive quarters from 5,394 in Q2/2009 and 5,737 in Q3/2009 to 7,584 in Q4/2009, while the 2011 number has been reduced from 12,917 in Q2/2009 to 11,673 in Q3/2009 and 9,196 in Q4/2009. It is believed that some of the projects which were scheduled to be completed in 2011 will be completed ahead of time. Therefore, we expect the number of completions in 2010 to increase further. In addition, the future supply from 2013 onwards has increased by 5,625 units compared with a quarter ago, likely due to some developers bringing forward their development plan submissions as a result of the heated primary market. In line with the government s announcement to reinstate the Confi rmed List and replenish the supply of Reserve List sites, the 1H/2010 GLS Programme has 26 residential sites (including executive condominium sites and white sites) in total, comprising eight sites on the Confi rmed List and 18 sites on the Reserve List. Overall, all of these sites can generate 10,550 private residential units. Of these, we estimate that there will be about 8,960 units (85 per cent) in the mass-market segment, while the balance will be mid-tier residential homes. Future Supply, > ,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2, >2013 Outlook Q4/2009 Q3/2009 The high-end residential segment is most likely to take the lead in 2010, on the back of the recovering economy and the return of foreign buyers. With the opening of the two IRs, Singapore will featured more prominently on the global real estate investment map, especially the high-end residential market which is still about 18 per cent off peak and relatively cheaper than other major global cities. Going forward, a 10 to 15 per cent price increase in the highend market is expected and we may even see 2007 peak prices challenged if momentum surpasses expectations. The mid-tier and mass market prices, having had a strong run in 2009, are likely to grow moderately by 5 to 10 per cent this year. Over 200 offices and associates throughout the Americas, Europe, Asia Pacific, Africa and the Middle East. 3

4 For further information, please contact: singapore Michael Ng Managing residential sales, singapore Phylicia Ang international marketing, singapore Julian Sedgwick Senior Associate residential leasing, singapore Patrick Lai prestige homes, singapore Steven Ming research & consultancy, singapore Jessie Yeo Executive research & consultancy, asia pacific Simon Smith Senior address Savills (Singapore) Pte Limited 2 Shenton Way #17-01 SGX Centre 1 Singapore T: F: corporate website This document is prepared by Savills for information only. Whilst reasonable care has been exercised in preparing this document, it is subject to change and these particulars do not constitute, nor constitute part of, an offer or contract; interested parties should not rely on the statements or representations of fact but must satisfy themselves by inspection or otherwise as to the accuracy. No person in the employment of the agent or the agent's principal has any authority to make any representations or warranties whatsoever in relation to these particulars and Savills cannot be held responsible for any liability whatsoever or for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this document. This publication may not be reproduced in any form or in any manner, in part or as a whole without written permission of the publisher, Savills. Savills (Hong Kong) Limited Savills Research MICA(P) No. 218 / 02 / 2009 Company Reg No D

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