The month of December usually marks a lull in the property market, and the year-end of 2022 was no exception. As throngs of Singaporeans embarked on their long-awaited vacation trips since COVID-19, the property market experienced the lowest volume of private home sales since January 2009.
December 2022 recorded just 170 private home sales (excluding Executive Condos), translating into a 34.6% month-on-month dip in sales, down from 260 units sold in November 2022. Comparing year-on-year numbers, the difference is a drastic drop of 74% from the 650 units shifted in December 2021.
December continued the downward trend from the previous two months across the three private home sub-markets. The Core Central Region (CCR) contributed slightly more than half of private home sales (excluding ECs), at 52% or 89 units. This is a decline from 149 units in November 2022.
Meanwhile, 54 new private homes were sold in the Rest of the Central Region (RCR) sub-market, which is a 25% fall from the previous month. In the Outside Central Region (OCR), only 27 transactions were tallied, mainly due to the lack of unsold supply in this sub-market.
In contrast, ECs sales were buoyed by the launch of Tenet EC in Tampines in December. Tenet took up 96% of the month’s EC sales, with the total volume for the month reaching 468 units.
Insights on December’s private home sales
December may have recorded dismal-looking sales, but it is likely due to the limitations of a lack of supply of homes, including few unsold stock and no major launches of new projects. The festive period and the high number of post-pandemic travellers may have also diminished activity in property sales for the time being.
Other factors to watch are the cooling measures from September 2022 and the high interest rates. While these are expected to make homebuyers more cautious in their decisions, it is unlikely that demand for new homes will wane just yet. Besides the strong performance of Tenet EC, robust buyer demand is further evinced by the healthy sales volume at Seneca Residence in Tanah Merah, which sold 60% of its units at a median price of $2,072 PSF during its launch weekend.
Accounting for December’s sales, the total number of private home sales in 2022 is 7,153, a sharp decrease from 13,027 in 2021, making 2022 a year of the lowest private home sales since 2008. This is understandable given the myriad of curveballs the property market has been thrown, including signs of oncoming recession, inflation, climbing interest rates, and property cooling measures.
Analysts predict that interest rates will remain high in 2023, although they showed some signs of moderating at the start of the year. Onlookers are hopeful for a slowdown in growth, with rates coming down in 2024. Some homebuyers may take this as an opportunity to make new home purchases before interest rates ultimately fall and trigger a new wave of housing demand.
And that rounds up the private home market for 2022 – indeed, a challenging year not just for the property market but for the wider economic situation. While the outlook for 2023 remains uncertain, there are bound to be opportunities for those who know where to look.
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