New private homes sales in Singapore continued their decline in February due to developers delaying launches during Chinese New Year celebrations.

Analysts claim that the “true reflection” of consumer sentiment will come in March when some major launches start to take place.

According to data released Friday (Mar. 15) by the Urban Redevelopment Authority, developers sold 149 units of private housing in February. This was 47 per cent less than the number of 281 homes that were moved in January.

The monthly figure is approximately a third of February’s 433 sales, excluding Executive Condominiums (ECs).

Developers sold just 174 units in February 2008.

Including ECs 183 units have been sold in February. In January, there were 929 launched units and 588 sold.

The main reason for the drop in sales is the lack of new launches by major non-landed developments. The developers launched only 45 units, which is nearly 10x less than the 417 that were launched in the preceding month.

This is also very different from past property booms where developers rushed to release their residential projects just a couple of weeks after CNY. The lack of launches last month indicates that developers will wait to see when the most appropriate time is to release new developments.

In 2023 new home sales reached a low 15 years ago of 6,421 units, down 9,6 per cent compared to 2022’s 7099 units. This followed repeated cooling measures and a softening economy. In light of the many new options available, increased buyer fatigue, and growing resistance to high-priced products, buyers have become more selective.

Most sales came from previous projects, as there were none in February. This includes the 512 units Lumina Grand EC at Bukit Batok which was launched in January. The project was the top-selling development in February. 16 units at a price median of S$1,497 were sold.

The Botany project, which has 386 units and 15 units were sold at a price median of S$2,018 psf.

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Locals were the main buyers of 14 units, and one unit was bought by Singapore permanent residents.

There were only three homes bought by foreign buyers during February. It is the lowest monthly number of foreign homebuyers ever since the Additional Buyers Stamp Duty rate (ABSD), for them, was doubled from 20% to 60%.

Even though they had to pay the steep ABSD of 60%, buyers still saw value in their purchase. Terra Hill in Rest of Central Region sold a unit of 3,035 square feet for S$8.05million, which meant the buyer would have to pay S$4million in ABSD.

URA’s statistics also showed that condo and private apartments sales were pretty evenly distributed across the three segments of the market last month.

In the Outside Central Region, 58 units were sold. This represents 38.9 percent of all sales. Core Central Region sales accounted for 22.1%, or 33 units.

The prime CCR median price dropped by 3 per cent in February, due mainly to “thin volume” of sales and a larger base than the previous months. Prices fell 0.5 per cent on the RCR, and 1 percent on the OCR for February.

The sales are tepid, but analysts predict that in March momentum will increase with the launch of some major projects.

The Lentor Hills estate includes two such buildings – Lentor Mansion with its 533 units and Lentoria, a 267 unit building.

Lentoria’s launch weekend, in early March, saw the sale of 50 units. This should boost sales volumes in the primary marketplace.

Lentor Mansion – which will be available for bookings on 16th Mar – has attracted interest from preview and is expected to have a favorable response from customers.

Comparing the performance of the March market to that of February can provide a more accurate picture of buyer’s sentiment, because it is a short month and there are fewer launches.

Analysts expect that in total, 7,000-8,000 new homes may be sold between 2024 and 2025. While it is a significant improvement over last year’s 6,421 unit sales, the number is still well below the 5-year average of 9 288 units.

In the near future, the market for private residences will be affected by macroeconomic conditions which are bleak, as well as cooling measures. Interest rates may also remain high.