$16-22b in new home sales for 2010: CBRE
Good chance of the luxury segment making a notable return in the later half of the year
By UMA SHANKARI
THE total value of all new homes sold this year will amount to $16 billion-$22 billion as the property market sees a follow-through of the momentum that begun a year ago, said CB Richard Ellis (CBRE) in a new report.
Last year, a total transaction value of $16.22 billion was recorded, based on caveats lodged for the full twelve months in the year. In comparison, the total value of new home sales for the whole of 2007 (the height of the property market boom) was $23.52 billion worth of primary transactions. CBRE's analysis of URA data indicates that the dollar value of 2009's transactions in the new home market accounted for only 68.9 per cent of the total value in 2007.
But the total number of new homes sold last year was similar to that of 2007. For the full year 2009, URA statistics show that 14,688 new homes were sold in the private residential market - comparable to the all-time high of 14,811 new home sales seen in 2007.
The lower transaction value in dollar terms recorded last year compared to 2007 can be attributed to the large number of small- format homes of less than 500 square feet that were sold last year. These small units fetched relatively lower price quantums.
Another reason was the popularity of mass-market homes last year. By contrast, much of the demand in 2007 came from the luxury segment where the overall price quantums were high.
For this year, CBRE's executive director for residential Joseph Tan predicts that the total transaction value (in dollar terms) will lie between the $16.22 billion seen last year and the $23.52 seen billion in 2007 - even though the number of units sold will be similar.
The total transaction value of caveats from January to March this year account for some $4.2 billion in primary sales - or about 26 per cent of last year's total transaction value.
And a total of 4,380 new homes were sold in the first quarter of this year - paving the way for similar transaction volumes recorded in 2009 and 2007 at 14,000 units each year.
'Prices are generally higher in 2010 with demand remaining robust. On that count, the total value at the end of the year should be higher than that in 2009,' Mr Tan said. 'In addition, there is a good chance of the luxury segment making a notable return in the later half of the year, as competitive tax rates and a highly- rated liveable environment might attract more high-net-worth foreigners to Singapore.'
Copyright © 2010 Singapore Press Holdings Ltd. All rights reserved.
HEADING HIGHER
'Prices are generally higher in 2010 with demand remaining robust. On that count, the total value at the end of the year should be higher than that in 2009,' says Mr Tan
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