2018 was perhaps very much a year filled with stops and starts for the real estate industry. What were the highlights of the year?
Changing home sizes, cooling measures and record sales
2018 may be a Jekyll and Hyde of sorts, perhaps with July’s implementation of the cooling measures throwing the largest spanner in the works.
The first half was filled with buying activities and the collective sale fever running high. Just as the property market was recovering in the earlier half of the year, the government placed new restrictions on both developers and consumers by raising stamp duties and developmental charges.
This may have been their reaction to the rapid pace of recovery within the first 6 months of the year, but perhaps it was more to rein in the collective sales segment which was raking up record sales with high land bids.
Thus the second half of the year saw not only the authorities but also the industry figuring out how to handle the new measures.
What the second half of the year also brought was a change in the maximum number of apartments allowed in a development outside of the central area. Developers who were hoping to capitalise on shoebox apartments in suburban projects will have to re-strategise.
The Urban Redevelopment Authority (URA) has placed an 85 sq m minimum on the gross floor area of new units.
November’s sales hopeful sign for the new year
A record was set on collective sales of private residences with Pacific Mansions selling for $980 million. Last year, Tampines Court was sold for $970 million and Amber Park for $906.7 million. The last large sale prior to last year was Farrer Court which was sold for $1.34 billion in 2007.
As 2018 draws to a close, November’s sales figures have shown promise of improving market sentiments as buyers flocked to the 7 new launches and snapped up 1,198 units last month.
With the likelihood of 40 more new launches from developers next year, how will the new homes and resale private homes segments react?