Sales of new private homes down 80% in December

Sales of new private homes plunged nearly 80 per cent in December compared to a month ago, as developers held off new property launches.

According to data from the Urban Redevelopment Authority (URA), just 259 units of new private homes were sold in December, down from 1,228 units transacted in November.

Among the units sold, 125 are located in the suburban areas, 90 units in the city fringe, and 44 units in the core central region.

For the whole of 2013, total private home sales amounted to about 15,000 units -- levels last seen during the global financial crisis five years ago.
URA data showed that just 118 new units were launched in December, the lowest since such statistics were available in mid-2007.

Desmond Sim, Associate Director at CBRE Research, said: "In the month of December, there were hardly any major launches. Going forward, we expect launches to be in the region of 12,000 to 14,000.

"CBRE expects out of this 12,000 to 14,000, the take-up to be in the region of 10,000 to 12,000. Looking back at the average of 12,000 units a year, we might perform slightly below the 10-year average, going forward."

With the exception of one unit in the suburban area, the rest of the new private homes launched were in the city area.

Including sales from executive condominium projects, 333 new units were sold in December, down from 1,714 units in November.

Analysts expect launches like Panorama in Ang Mo Kio and Hillford in Bukit Batok to hit the market in January, improving December's dismal numbers.

December may be a typically quiet period, but property consultants said the weak sales performance in December was mainly due to the government's cooling measures.

This brought the total annual sales volume in 2013 to 14,980 units, which was some 30 per cent lower than 2012 sales.

Going forward, some market experts expect property prices to weaken in 2014.

Chua Yang Liang, head of research at Jones Lang LaSalle, said: "We think the overall market -- given that transaction volumes, not just (for) the new (units)... but in the secondary sales market -- we have seen numbers falling off.

"We are forecasting softening of prices of between 5 and 8 percent for the entire market."
Some market experts still find property market fundamentals to be very sound, with the economy growing steadily and unemployment remaining low.

Despite the fall in transaction volume, they observed that prices of new condominiums sold in the suburbs in December was 3.2 per cent higher than in November.

City fringes saw prices decline 2.2 per cent, while homes in the city remained stable.