Sluggish start to 2024 ends in decade-high home sales at year’s end
In 3Q2024, new home sales leapt 60% q-o-q, according to Huttons, that regarded a shift in view, which some attribute to the 50-basis point interest rate cut by the US Federal Reserve in September.
The property industry in 2024 unfolded in two starkly different halves. The very first half was sluggish, with boutique developments making centre stage and the lowest variety of units released for sale as 1H1996, according to Huttons Data Analytics. Sales quantity mirrored this fad, with simply 1,889 units sold– the lowest ever since 1996.
The exemption was the 533-unit Lentor Mansion, that achieved a 75% take-up rate throughout its launch weekend in March. A lot of other venture launches in 1H2024 observed reasonably lacklustre profits contrasted to 2023.
” Market belief was tentative and mindful,” mentions Mark Yip, Chief Executive Officer of Huttons Asia. “It could be due to unpredictabilities in the job market and constantly high interest rates. Buyers were likely restraining, waiting for the extremely anticipated plan launches later in the year, like Chuan Park and Emerald of Katong.”
“Even with close monitoring by authorities, brand-new steps are likely to stay on hold unless clear indicators of consistent market overheating arise,” Chia incorporates.
The 348-unit Norwood Grand in Woodlands even achieved multiple breakthroughs. Over the weekend of October 19-20, it found a take-up rate of 84%, making it the very popular project in terms of amount of sales since October. The common rate of units offered was $2,067 psf, marking the very first time a project in Woodlands surpassed the $2,000 psf threshold.
Developer profits in November soared to 2,557 units– the strongest amount since March 2013, when 3,489 units were introduced and 2,793 were marketed, according to Huttons Data Analytics.
It started on Nov 6 with the launch of the 367-unit The Collective at One Sophia, followed by the 366-unit Union Square Residences at Havelock Roadway on Nov 9. Momentum built up with the launch of the 916-unit Chuan Park on Nov 10, and it surged over the weekend break of Nov 15-16 with 3 plans started jointly: the 846-unit Emerald of Katong, the 552-unit Nava Grove, and the 504-unit Novo Place exec condominium (EC).
The strong November performance pushed overall property developer deals for the early 11 months of 2024 to 6,344 units. Year-end numbers are expected to surpass 6,500 units, exceeding the 6,421 units offered in 2023. “This mirrors the stability and flexibility of the real estate market,” claims Huttons’ Yip. “It emphasizes the long-lasting appearance of property as an asset for wealth development and conservation.”
Norwood Grand was the very first new nonpublic non commercial job released in Woodlands in 12 years. Its strong performance was in addition a very clear indicator of growing purchaser trust and need, according to Huttons’ Yip. It set off a tidal upsurge of activity in November with a record-breaking six new ventures comprising 3,551 units released over 10 days.
According to Chia Siew Chuin, JLL’s head of residential research, the sluggish performance of the private residence industry in the first 3 quarters of 2024 developed an irregular year-end scenario. “Property developers, that had consistently postponed kick off as a result of economic uncertainties and expectations for improved conditions, ultimately turned out ventures in November.”
The initial project launched after the Lunar Seventh Month was the 158-unit 8@BT at Bukit Timah Link. Over the weekend of Sept 21– 22, 53% of its units were purchased at an average price of $2,719 psf.
Yip notices that the launch of the 276-unit property Kassia on Flora Drive in late July, which attained a 52% take-up rate, established the scene for solid business energy following the Lunar Seventh Month.
Additional documentation of enhanced sales momentum arised on Oct 5, when greater than 50% of the 226 units at Meyer Blue were snapped up in private sales. Units were settled at a normal rate of $3,260 psf, establishing a brand-new benchmark for the prime District 15 enclave on the East Coast.
With cumulative brand-new home sales in 2024 likely to stay on a par with that in 2023, Chia considers regulatory treatment “unlikely”. Any treatment, she says, will depend upon 2 factors: sustained sales force right into the initial quarter of 2025 and a simultaneous sharp surge in property costs outpacing GDP growth.
Chia claims this crucial change from caution to motion was triggered by the approaching year-end festive lull and improved market sentiment from the third quarter of 2024. “The surge in activity has transformed November right into an uncommonly dynamic period for real property release, defying the normal seasonal stagnation and producing a vibrant market atmosphere.”
Speculation is today rampant about the possibility of further property cooling measures, provided the uncharacteristically high November sales. “While November’s sales figures are outstanding, they offer an incomplete image for forecasting cooling steps,” Chia notes. “The marketplace liveliness was greatly generated by a year-end thrill to launch projects.”
