New private home sales slow in Q1: report
1,200 units sold out of 1,800 launched; pace put down to developers’ delay
AFTER developers’ sales of private residential properties in the primary market hit a three-year high of 8,955 units last year, things slowed down in the first quarter of this year, according to property consultancy Knight Frank.
About 1,200 private homes were sold, out of an estimated 1,800 launched.
Although the sales number is almost a 50 per cent drop from the final quarter of 2005, Knight Frank is unperturbed. ‘The figure is not alarming because in the past three years, the lowest number of primary market sales for that year was usually recorded in the first quarter,’ it said in a quarterly report.
Knight Frank attributed the slowdown in the number of launches to deliberate holding back by developers as they awaited positive news from February’s Budget.
Three more projects are expected to be launched this weekend. They are: 99-year-leasehold Southbank by United Overseas Land (UOL); One Amber, a freehold property by UIC, SingLand and UOL; and The Chuan, a 999-year leasehold project by Kheng Leong Co.
The secondary market is expected to remain buoyant, even though sales volume in Q1 neared 2,000, a slide from 2,311 units in Q4 2005.
Knight Frank said the movement in the secondary market is not due to speculative activities but ‘the rising number of successful en bloc sales and the active marketing of unsold units in developments that have newly obtained their Temporary Occupation Permit’.
Foreigners are estimated to have comprised about 22 per cent of the total number of private homebuyers in Q1. Indonesians and Malaysians remained the largest bloc, with Chinese, Indian and UK nationals fast expanding their market share.
Knight Frank also found that foreigners who bought properties at prices between half a million and a million dollars are more likely to be permanent residents, while those who spent $1-1.5 million are non-PRs.
Prices of high-end properties went up 3 per cent in the primary market, while those in the secondary market rose 5 per cent. But prices in the mass market segment remained flat.
Knight Frank believes average prices in the private residential market will grow between 4 and 8 per cent in the next 12 months.
The rental market for private residential properties has picked up in the high-end and lifestyle-driven segments, Knight Frank observed. Rents for high-end condos grew between one and 3 per cent quarter on quarter in Q1.
But Knight Frank thinks rents will consolidate in the coming months, as demand is concentrated in properties that are higher-end and higher profile.
For industrial properties, Knight Frank projects rents for conventional space to grow by 2 to 3 per cent for the entire year, while expanding 3 to 4 per cent for high tech space.
Source : Business Times - 29 Mar 2006
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