Sluggish start to 2024 ends in decade-high home sales at year’s end
The real estate industry in 2024 unfolded in two starkly contrasting parts. The first half was slow-moving, with store developments getting centre stage and the lowest number of units released sold ever since 1H1996, according to Huttons Data Analytics. Sales volume mirrored this fad, with just 1,889 units sold– the most affordable since 1996.
Further proof of boosted sales energy emerged on Oct 5, the moment more than 50% of the 226 units at Meyer Blue were gotten in private sales. Units were negotiated at an average rate of $3,260 psf, establishing a new measure for the prime District 15 enclave on the East Coast.
Speculation is now rampant about the possibility of further real estate cooling procedures, given the uncharacteristically high November sales. “While November’s sales numbers are remarkable, they offer an incomplete image for anticipating cooling steps,” Chia notes. “The market liveliness was largely driven by a year-end rush to launch projects.”
In 3Q2024, new home sales jumped 60% q-o-q, according to Huttons, which noted a change in belief, which some credit to the 50-basis factor interest rate cut by the US Federal Reserve in September.
” Market sentiment was tentative and mindful,” notes Mark Yip, Chief Executive Officer of Huttons Asia. “Perhaps due to unpredictabilities in the occupation market and persistently high rate of interest. Purchasers were most likely restraining, waiting on the extremely anticipated project launches later in the year, such as Chuan Park and Emerald of Katong.”
Norwood Grand was the very first brand-new exclusive non commercial job introduced in Woodlands in 12 years. Its solid performance was in addition a very clear sign of increasing customer trust and need, according to Huttons’ Yip. It triggered a tidal upsurge of activity in November with a record-breaking six new projects making up 3,551 units unleashed over 10 days.
The solid November efficiency pushed complete developer sales for the early 11 months of 2024 to 6,344 units. Year-end numbers are expected to surpass 6,500 units, going beyond the 6,421 units marketed in 2023. “This reflects the durability and flexibility of the estate market,” says Huttons’ Yip. “It emphasizes the enduring appeal of real property as an asset for wealth creation and security.”
According to Chia Siew Chuin, JLL’s head of residential research, the sluggish functionality of the private residential market in the very first 3 quarters of 2024 produced an atypical year-end circumstance. “Developers, who had actually repetitively postponed kick off due to financial uncertainties and optimisms for better conditions, finally turned out ventures in November.”
Yip observes that the dispatch of the 276-unit property Kassia on Flora Drive in late July, which accomplished a 52% take-up fee, established the stage for strong business energy following the Lunar Seventh Month.
The 348-unit Norwood Grand in Woodlands additionally accomplished several turning points. Over the weekend of October 19-20, it observed a take-up figure of 84%, causing it to the best-selling venture in regards to amount of sales since October. The common price of units marketed was $2,067 psf, noting the very first time a project in Woodlands went beyond the $2,000 psf limit.
“Despite close monitoring by authorities, new actions are likely to stay on hold unless clear indications of persistent market overheating emerge,” Chia includes.
Tembusu Grand City Developments Ltd
Chia claims this crucial shift from vigilance to motion was prompted by the coming close to year-end joyful lull and boosted market belief from the third quarter of 2024. “The surge in activity has actually changed November into an unusually vivid period for real estate launches, resisting the common seasonal downturn and developing a dynamic market atmosphere.”
The exception was the 533-unit Lentor Mansion, that accomplished a 75% take-up rate throughout its release weekend in March. Most other project launches in 1H2024 viewed relatively lacklustre profits compared to 2023.
Developer profits in November rose to 2,557 units– the highest number ever since March 2013, when 3,489 units were introduced and 2,793 were offered, according to Huttons Data Analytics.
It started on Nov 6 with the open 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 rose over the weekend break of Nov 15-16 with three projects released in concert: the 846-unit Emerald of Katong, the 552-unit Nava Grove, and the 504-unit Novo Place executive condominium (EC).
The very first campaign 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 snapped up at a common cost of $2,719 psf.
With cumulative brand-new home sales in 2024 most likely to remain comparable with that in 2023, Chia considers regulatory treatment “unlikely”. Any intervention, she says, will depend on two factors: continual sales drive right into the first quarter of 2025 and a simultaneous sharp surge in property costs exceeding GDP growth.
