Singapore home sales plummet 72.1% to 394 units in August

There were over 5,000 units sold in the first eight months of the year.

Based on the monthly data for developers’ sales from the Urban Redevelopment Authority (URA), there were 394 homes (excluding Executive Condominiums (ECs)) sold by developers in August 2023, a 72.1% drop from the 1,412 units sold in July 2023, and 10.0% less than the 438 units transacted in August last year. A total of about 5,189 units were sold in the first eight months of 2023.

In a report, Knight Frank said there were 590 units (excluding ECs) launched in the month of August, comprising the 78-unit Orchard Sophia, the 306-unit The Lakegarden Residences, the 324-unit TMW Maxwell and the 105-unit The Arden. The drop in developer sales in August 2023, was due in part to the Chinese Seventh month that started in the middle of August. 

Here’s more from Knight Frank:

Homebuyers have also become increasingly reticent, taking the time to evaluate the selection of projects that have been launched in the past few months, as well as upcoming launches. Growing concerns weighing on the minds of homebuyers also include the current pricing against the increased costs of borrowing, economic uncertainty, and more public housing options in the form of BTO launches in good locations.

Against this build-up in tentativeness among homebuyers, the sole EC launch of Altura in Bukit Batok was the best performing project in the month with 225 sales. The prices at the Altura ranged from S$1,325 psf to S$1,554 psf with a median of S$1,480 psf, signalling that homebuyers are willing to fork out at new benchmark prices for hybrid private-public ECs. 

Since the escalation of interest rates from the second half of 2022, affordability has become an increasing concern among homebuyers. Therefore in the months ahead, the spotlight is expected to increasingly focus on ECs, with homebuyers leaning towards the more modest price option that this hybrid housing type represents.

General demand for private homes in the remaining months of 2023 will continue to be underpinned mostly by homebuyers purchasing for their own occupation.

However, despite household balance sheets remaining healthy, homebuyers will increasingly become more circumspect in their housing decisions, targeting locational and product attributes that best fit their lifestyle and family requirements, such as schools.

This, in addition to having to consider the latest round of cooling measures announced in April, sticky high interest rates, job security and recessionary pressures. Investors, both locals and foreigners, will likely remain on the sidelines until interest rates peak and stabilise, and until such time when more optimism returns to the economy. Nonetheless, the total expected number of new sales is still on track to range from 7,000 to 8,000 units as earlier projected by Knight Frank at the end of 2022.