May home sales figures a healthy sign

A decline in the number of new private homes hitting the market sent sales figures down last month, but transactions were still pretty robust.

Developers moved 1,024 homes - excluding executive condos (EC) - last month, a fall of 34 per cent from the 1,558 shifted in April.

It was the second straight month-on-month decline following the 12.5 per cent drop from March to April, figures from the Urban Redevelopment Authority (URA) showed yesterday.

Last month's sales were also lower than the 1,058 units moved in May last year.

Developers placed just 339 new units on the market last month, compared with the 1,616 launched in April. No new ECs were launched last month.

International Property Advisor chief executive Ku Swee Yong said: "Considering there were no major project launches last month, the sales booked were healthy.

"The sales momentum seen in the past months has carried over to May."

Buying sentiment has been positive, with new sales exceeding 1,000 units for three consecutive months.

Sales in the suburban areas led the way last month with 617 transactions, followed by 341 in the city fringe and 66 in the core central region.

The top-selling private residential project last month was Parc Riviera in West Coast Vale, which moved 83 units at a median price of $1,246 psf.

The Santorini in Tampines was next, selling 64 units at a median price of $1,022 psf.

ERA Realty Network key executive officer Eugene Lim noted that buyer confidence is high, boosted by a tweak in some cooling measures in March.

"Most buyers are encouraged by the shorter holding period of three years for the payment of Seller's Stamp Duty, compared to the four years previously," he said.

In the EC segment, 370 new units were transacted last month. In April, 371 new units were sold. This brought the total new home sales in May to 1,394 units.

Sol Acres EC in Choa Chu Kang was the best performer in this segment, shifting 116 units at a median price of $794 psf.

New homes sales started to pick up recently, when home buyers who had been sitting on the fence decided to get back into the market following three years of price decline.

PropNex Realty chief executive Ismail Gafoor said: "More consumers will come to realisation that the market has bottomed out and prices are likely to inch upwards with the strong land bid prices we are currently witnessing."

He said it could prompt more home seekers to commit, and in turn drive up new homes sales to 10,000 units - excluding ECs - for the year.