The new private home sales segment had a good run in 2019, due partly to interest from HDB upgraders who were buying new inventory directly from developers.
New private homes attract HDB upgraders
Developers sold 10,104 residential units last year, a considerable 14.9% more than the 8,795 units sold in 2018. Many of the buyers of new property were previous HDB owners who had sold their public housing units to move into the private property market.
Analysts are encouraged by the numbers especially against the backdrop of an uncertain global economic situation. Some have said that crossing the 10,000 mark is a feat in itself.
Majority of the transactions were in the suburbs, with 6 out of the 10 top-selling projects from 2019 situated in the outside of the central region. HDB upgraders usually look for properties near their previous homes or in neighbouring HDB estates, hence this result is hardly surprising. More than half of the sales were from previously-launched projects which attracted buyers with their price points. December’s top-sellers in the new homes segment included Parc Botannia, Parc Esta and Parc Clematis.
Will resale HDB market also benefit from upgrading cycle?
The second half of 2019 saw more buyers picking up units directly from the developers, perhaps as more projects were launched during that period. There was a 43.5% increase in new home sales in Q4 of last year, in a year-on-year comparison with 2018. Developers sold 2,635 developers units in the last quarter of 2019.
New home prices are expected to rise 2% to 4% this year with 11,000 new units expected to be released this year over 50 launches. As more HDB upgraders look to sell their HDB flats, will the resale public housing market also benefit from this upward movements? The resale HDB market is considered to have bottomed out last year, this year’s sales volume may be held up by HDB upgraders.