Date: 15 April 2009 | PDF version

Analysis of URA monthly private residential statistics for the month of March 2009

Singapore
Based on URA’s monthly statistics, the 832 private residential units launched and 1,220 units sold in March 2009 reflected a marginal decline from the preceding month. Although these figures may point
to a possible stabilization in the primary sale volume of private residential market, such figures may not be repeated consecutively for the rest of 2009. Specifically, the combined surge in the number of
units launched in the month of February and March amounted to a total of 2,108 units launched in 1Q
2009. This figure is approximately three times that of what was achieved in 4Q 08. Similarly, the 2,660 units sold in 1Q 2009 was a significant six times that of the previous quarter. This quarterly increase in figures also hint at pent up demand from August to January 2009.

It was noted that in recent months, activity was centred primarily in the suburban market where 63.4% of all units launched occurred in this region. Correspondingly, 63.2% of all units sold by developers were also transacted in the suburban market. While the mass-market Outside Central Region witnessed increased activity, in particular during recent months, the prime Core Central Region performed quite the opposite. While no units were launched in the prime market at the onset of 2009, the recent 70 units launched in March resulted in a total of 100 units launched in the prime market in 1Q 2009. This amount thus far reflected only 4.7% of all units launched in 1Q 2009, representing a significant decline when compared to the 39.4% of all units launched in 4Q 2008. Demand for the prime market has also eased with only 9.3% of all sales taking place in this region in 1Q 2009.

The subdued performance in the prime market can be partly attributed to the retreat of foreigners in Singapore’s luxury property market. Preliminary figures suggest that the percentage of foreign transactions stood at 16.8% in 1Q 2009, settling at levels observed in 2Q 2003, when the SARS outbreak badly affected the market. In March 2009, the lowest priced non-landed transaction was in Double Bay Residences where a unit was transacted at S$409 psf. On the other hand, a unit in Orchard Scotts was transacted at S$2,220 psf. This is a slight increase over February, where the highest priced non-landed unit transacted was at Vida at $2,048 psf.

Unless the Singapore economy and employment market were to improve significantly this year, between 6,000 and 7,000 private homes are projected to be sold in the primary residential property market. The demand for luxury homes is expected to remain subdued as investors remain cautious. However, it is anticipated that there will be healthy demand for mass-market homes as long as the average HDB resale apartment prices do not contract by more than 7% yoy.

For further information, please contact:

Nicholas Mak, Director of Consultancy & Research Department, Knight Frank, +65 6228 6821

Notes to Editors

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