• Cushman & Wakefield’s Analysis of Q3 URA Flash Estimates
Residential

Cushman & Wakefield’s Analysis of Q3 URA Flash Estimates

Singapore’s private property prices bucked the trend and rose for a second consecutive quarter despite the deterioration of the global macroeconomic health and the escalation of US-China trade tension. Based on the URA flash estimates, overall residential prices rose 0.9% q-o-q in Q3 2019, driven by robust sales in the non-landed segment. Overall landed prices fell 2.2%, while the non-landed home prices rose 1.7%. Year-to-date, overall private residential prices have risen by 1.7%, and prices are at the highest in nearly six years since Q4 2013.

Current new sales volume points to resilience in the market, where pent-up demand continues to flow into the market despite cooling measures and a more subdued economic outlook. The sustained price increase in the last two quarters has given confidence to the market that the long-term prospects of the Singapore residential market remain healthy. Singapore has always been seen as a safe haven in times of market volatility, coupled with its status as a top international financial hub and one of the most liveable cities in the world.

New launches always help to prop up property prices. This is because developers have not much leeway to launch their new projects lower than the previous projects due to the high land costs paid during the 2017-2018 property boom. As buyers are still biting at the current prices, the sales momentum in the primary market has been sustained. Healthy take-up was recorded in recently launched projects such as Avenue South Residence and Parc Clematis for instance. Some of the existing launches such as Treasure At Tampines, Whistler Grand, Parc Esta have consistently ranked top 10 best-selling projects so far this year.

In Q3 2019, developers are expected to achieve more than 3,100 of new sales (landed and non-landed) based on estimates from the total number of caveats lodged, which would be the highest quarterly new sales figure since Q2 2013 when 4,538 units were sold.

Nonetheless, competition for buyers remains stiff given the elevated levels of unsold inventory and ample pipeline of new launches. Expected upcoming major new launches in Q4 2019 include Midtown Bay, Urban Treasures, Sengkang Grand Residences and One Holland Village.

The buoyant sales in the mid-tier and high-end segment have boosted prices for these two segments. Singapore seems to have benefited from the diversion of investments in the high-end residential market against the US-China trade tussle. The Core Central Region (CCR) or the high-end segment posted 2.9% growth in Q3 2019, the highest price increase in the segment since Q1 2018. The Mid-tier segment also continued to record healthy sales at new benchmark prices. Despite the increased uncertainties in the macroeconomic environment, local Singaporean buyers remain positive when they see good deals in the city fringe locations with the potential for capital appreciation.

Cushman & Wakefield's Analysis of Q3 URA Flash Estimates

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