savills- 2q2015
TRANSCRIPT
8202019 Savills- 2Q2015
httpslidepdfcomreaderfullsavills-2q2015 14
savillscomsgresearch 01 MCI (P) No 040042015Company Reg No 198703410D
Brie1047297 ngResidential sales August 2015
Savills World ResearchSingapore
SUMMARY
Prices continue to creep south but transaction volumes strengthen Singaporersquos economy continues toslow in the second quarter registeringa 18 year-on-year (YoY) growth
Developer home sales surged614 quarter-on-quarter (QoQ) butdeclined 206 YoY with the increasecoming mainly from two new launchesin the Outside Central Region (OCR)Transaction volume in the secondarymarket continues to strengthen by479 QoQ and 286 YoY
The number of uncompletedprivate homes launched increased765 QoQ to 2099 units largely fromprojects like Botanique at Bartley andNorth Park Residences
The Urban Redevelopment Authorityrsquos (URA) non-landed privateresidential price index dipped 08QoQ while the average price of high-end non-landed homes tracked bySavills slipped 05
Prices for new launches areexpected to remain 1047297rm with somemild upside pressures resaleprices are expected to remain softWith buyers having sat out themarket for the past two years since
the implementation of the TDSRframework their store of liquid assetshave increased signi1047297cantly and thisfrozen liquidity is beginning to thawand 1047298ow to smaller units in RCR andOCR developments
ldquo Although buyers arereturning having given uphope of a signi1047297 cant pricecorrection transactionvolumes need to increasemuch further to clear thebacklog of unsold inventoryrdquo Alan Cheong Savills Research
Image A Treasure Trove Punggol Walk
8202019 Savills- 2Q2015
httpslidepdfcomreaderfullsavills-2q2015 24
Brie1047297ng | Singapore residential sales August 2015
savillscomsgresearch 02
Market overview Although the major global economiescontinue to face uncertain timesahead some clarity is beginningto emerge For example havingembarked on a roadmap torestructuring its economy Chinarsquosgross domestic product (GDP) isshowing signs of stabilising at alower growth trajectory manifested inQ12015 when its economy grew 70YoY the slowest in nearly six yearsThis continued through in the secondquarter when its GDP also grew by70 The International MonetaryFund (IMF) reported that recovery inthe Eurozone is ldquoon trackrdquo despite theturmoil caused by Greecersquos debt levels
while the US economy is expected toexpand in Q2 with the unemploymentrate having fallen to 53 in June ndash thelowest in over seven years
Singaporersquos economy grew 18YoY in Q22015 slower than the28 YoY seen in the previousquarter The principal cause of theslowdown is the persistent weaknessin the manufacturing sector while thetrade-oriented services sector alsodeclined signi1047297cantly However non-oildomestic exports (NODX) reboundedwith a 47 YoY growth in June whichresulted in an upward revision of Q2rsquoseconomic growth 1047298ash estimate of17 YoY
Developers sold 2116 privateresidential units island-wide awelcome improvement of 614 QoQ
even though it was still 206 lowerYoY This was mainly attributableto the strong sales in the OutsideCentral Region (OCR) where 1669homes were sold a 1179 QoQincrease Market activity in the OCRaccelerated in Q22015 due to thesuccess of two newly-launchedprojects ndash North Park Residencesand Botanique at Bartley ndash whichtogether sold a total of 964 unitsamid the weak market sentiment
Although not as signi1047297cant thenumber of units sold in the CoreCentral Region (CCR) almost doubledto 154 units In contrast the Rest ofCentral Region (RCR) recorded a
fall in transaction volumes of 370to 293 units Thus on the wholedemand for private residential homesin the primary market is not out ofthe woods yet as evidenced by thenegative YoY growth
The secondary market howeveris witnessing signs of recovery as1988 private properties changedhands in Q2 growing 479 QoQand 286 YoY making Q2 themost active quarter since theimplementation of the Total DebtServicing Ratio in Jun 2013 Salesvolume increased on a quarterly basisacross all geographic regions (CCR
GRAPH 1
Primary private home sales volumes 2008-Q22015
Source Urban Redevelopment Authority (URA) Savills Research amp Consultancy
762
25964380 3595
65265412
1744 1311
1525
4654
40334444
5402
4538
26652116
1558
5578 3638 4262
5916
2430
1531
419
1860 4241 3603
4353
2568
1376
0
5000
10000
15000
20000
25000
2008 2009 2010 2011 2012 2013 2014 2015
N o o f u n i t s
Q1 Q2 Q3 Q4
TABLE 1
Major new launches Q22015
Source Savills Research amp Consultancy CCR = Core Central Region RCR = Rest of Central Region OCR = Outside Central Region
SNo Project name Developer Location CategoryTotal
no of unitslaunched
Take-up ()Price range
(S$ per sq ft)
1 Botanique at BartleyUOL Development (Bartley)
Pte LtdUpper Paya Lebar Road OCR 500 806 1049-1394
2 Hilbre 28 Development 72 Pte Ltd Hillside Drive OCR 10 600 1027-1546
3 Neem Tree Aylesbury Pte Ltd Jalan Kemaman RCR 24 417 1572-1669
4 North Park Residences North Gem Development Pte Ltd Yishun Central 1 OCR 600 935 1044-1572
5 Pollen amp BleuSingland Development(Farrer Drive) Pte Ltd
Farrer Drive OCR 28 393 1765-2104
6 Westwood Residences KBD Westwood Pte Ltd Westwood Avenue OCR (EC) 480 285 713-902
8202019 Savills- 2Q2015
httpslidepdfcomreaderfullsavills-2q2015 34
August 2015
savillscomsgresearch 03
Brie1047297ng | Singapore residential sales
RCR and OCR) and market segments(resale and subsale markets) Thatsaid the increase in transactionvolume in the secondary market does
not infer that prices have risen Onthe contrary it indicates a certainlevel of stability as buyers return to themarket where sellers have becomemore 1047298exible in their asking prices
Developers have also launched moreunits in Q22015 2099 uncompletedunits were launched an increase of765 QoQ Although the numberof new projects launched has notincreased from the last quarter theprojects launched this quarter arelarger and hence the number ofunits launched is signi1047297cantly higherQoQ The two largest projects arethe Botanique at Bartley and NorthPark Residences which cumulativelyoffered 1100 units By way ofcomparison Q1rsquos largest SimsUrban Oasis and Kingsford Waterbaylaunched only 514 units betweenthem It should be noted that thetotal number of units in the latter twodevelopments is 275 more thanthe combined total (1717 units) forBotanique at Bartley and North ParkResidences The higher launch 1047297guresre1047298ect the developersrsquo con1047297dence intheir pricing strategy and product
PricesThe Q22015 URA statistics revealedthat the non-landed private
GRAPH 2
Savills high-end non-landed home price index Q12005-Q22015
Source URA Savills Research amp Consultancy
0
50
100
150
200
250
Q 1 2 0 0 6 = 1 0 0
residential property index fell 08QoQ its seventh consecutive
quarterly decline Amongst thethree regions the CCR and RCR
experienced the lowest price fallof 06 (CCR for the second
successive quarter) while the OCR
registered a steeper decrease of 11Over the past six quarters RCRrsquos
performance was the most volatileThe price volatility may affect market
con1047297dence as property investors aretraditionally more risk-averse
Similarly Savills basket of high-endnon-landed homes recorded a 05QoQ dip to S$2215 per sq ft Thecurrent price level is 88 below thepeak of S$2429 per sq ft achieved inQ12013
Future Supply The Executive Condominium (EC)
market is expected to see morelaunches in 2H2015 as large projectssuch as Sol Acres are expected toenter the market However with 319out of 6990 uncompleted EC units
TABLE 2
Major upcoming launches
Source Savills Research amp Consultancy Launched in July 2015
SNo Project name Developer Location Category DistrictEstimated total no of
units
1 High Park ResidencesFernvale Development
Pte LtdFernvale Road OCR 28 1390
2 The BrownstoneCanvey Developments
Pte LtdCanberra Drive OCR (EC) 27 638
3 The Vales Anchorvale Residences
Pte Ltd Anchorvale Crescent OCR (EC) 19 517
4 Sol AcresMCL Land (Brighton)
Pte LtdChoa Chu Kang Grove OCR (EC) 23 1327
5 Signature at Yishun Gee-I Investments Pte Ltd Yishun Street 51 OCR (EC) 27 525
6 South Beach ResidencesSouth Beach Consortium
Pte LtdBeach Road CCR 7 190
7 Gramercy Park Aston Properties Pte Ltd Grange Road CCR 10 174
8202019 Savills- 2Q2015
httpslidepdfcomreaderfullsavills-2q2015 44
August 2015
savillscomsgresearch 04
Brie1047297ng | Singapore residential sales
Christopher J Marriott
CEOSoutheast Asia
+65 6415 3888cjmarriottsavillsasia
Phylicia AngExecutive DirectorResidential Sales
+65 6415 3277pangsavillscomsg
Alan CheongSenior DirectorSingapore
+65 6415 3641alancheongsavillscomsg
Simon SmithSenior Director
Asia Paci1047297c
+852 2842 4573ssmithsavillscomhk
Savills Singapore
Please contact us for further information
Savills plcSavills is a leading global real estate service provider listed on the London Stock Exchange The company established in 1855 has a rich heritage with unrivalled growth It is a company
that leads rather than follows and now has over 600 of1047297ces and associates throughout the Americas Europe Asia Paci1047297c Africa and the Middle East
This report is for general informative purposes only It may not be published reproduced or quoted in part or in whole nor may it be used as a basis for any contract prospectusagreement or other document without prior consent Whilst every effort has been made to ensure its accuracy Savills accepts no liability whatsoever for any direct or consequential lossarising from its use The content is strictly copyright and reproduction of the whole or part of it in any form is prohibited without written permission from Savills Research
Savills Research
Jacqueline WongSenior DirectorResidential Leasing
+65 6415 3878 jacquelinewongsavillscomsg
property market Buyers on the otherhand have a different expectationharbouring the hope that prices willfall further and hence they are in a
wait-and-see stance Unfortunatelywith their store of equity rising furtherdisappointment brought on by notseeing prices falling signi1047297cantly mayinduce those sitting on the fence tomake impulsive decisions and committo a purchase
The high take-up for projects launchedrecently like North Park Residencesand High Park Residences pointto a thawing out effect Thereforenotwithstanding a recent comment byK Shanmugam Minister for Foreign
Affairs and Law regarding the falsecorrelation between property coolingmeasures and general elections morebuyers may begin to return to themarket as their affordability level willhave increased while their patience hasrun out waiting for prices to declinefurther or measures to be relaxed
Nevertheless the expected increasein take-up of new projects does notnecessarily mean that normality hasreturned to the market because thebroad brush measures have merelymade the smaller units more affordableto local buyers whereas larger unitsand those with a high price quantummainly those projects in the CCRare not selling fast enough to clearoff the unsold inventory Adopting
launched left unsold competitionamong developers will be evenstronger which will be to the buyersrsquobene1047297t
Looking into the private residentialmarket (excluding ECs) launches ofnew projects may remain subdued asdevelopers still hold a cautious outlookon Singaporersquos private residentialmarket for 2H2015 Howeversuch sentiments may make somedevelopers take an opposite tack tolaunch a phase of their project bytaking advantage of the relatively lowcompetition in the market at prices thatyield them an acceptable pro1047297t margindemand vis-a-vis buyerrsquos affordability
OutlookThe property cooling measures aswell as the Total Debt Servicing Ratio(TDSR) framework have both slowedand deferred sales As it has beentwo years since the implementationof the TDSR framework liquid assetscontinue to accumulate amongsthouseholds and during this waiting outperiod prices have remained relatively1047297rm This means that affordability hasincreased with an increasing number ofbuyers now having the wherewithal toovercome some of the measures With
the General Election expected to beheld before the year ends developerswill also be trying to delay launcheshoping that the authorities will loosensome measures that have gripped the
CCRrsquos average monthly sales for theperiod January to May 2015 andassuming that there will be no furtherGovernment Land Sales (GLS) it
will take about 12 years to clear theinventory of unsold units in projectsunder development now For theRCR and OCR given that the GLSprogramme is usually focused on theseregions the time to clear the stock ofpresent and future unsold units will bemore than 12 years Therefore evenif island-wide take-up rates doubleit will take well over 1047297ve years to selldown the inventory Lowering pricesfurther would not be a panacea toincrease demand because much of theunsold stock are larger units whichbecause of the larger price quantumand the various cooling measures arebeyond the reach of many locals andpermanent residents
Regardless of whether the measuresare relaxed or not we believe that newsale prices will remain 1047297rm and mayeven exhibit some upside bias It is inthe secondary market that prices willremain under pressure as individualsselling their properties lack the clout tomake their unit stand out among thesea of similar units in the secondarymarket The only tool that they have isthe price Consequently the secondarymarket is expected to gain buyingmomentum as this is where buyerscan actually sense a noticeable pricecorrection
8202019 Savills- 2Q2015
httpslidepdfcomreaderfullsavills-2q2015 24
Brie1047297ng | Singapore residential sales August 2015
savillscomsgresearch 02
Market overview Although the major global economiescontinue to face uncertain timesahead some clarity is beginningto emerge For example havingembarked on a roadmap torestructuring its economy Chinarsquosgross domestic product (GDP) isshowing signs of stabilising at alower growth trajectory manifested inQ12015 when its economy grew 70YoY the slowest in nearly six yearsThis continued through in the secondquarter when its GDP also grew by70 The International MonetaryFund (IMF) reported that recovery inthe Eurozone is ldquoon trackrdquo despite theturmoil caused by Greecersquos debt levels
while the US economy is expected toexpand in Q2 with the unemploymentrate having fallen to 53 in June ndash thelowest in over seven years
Singaporersquos economy grew 18YoY in Q22015 slower than the28 YoY seen in the previousquarter The principal cause of theslowdown is the persistent weaknessin the manufacturing sector while thetrade-oriented services sector alsodeclined signi1047297cantly However non-oildomestic exports (NODX) reboundedwith a 47 YoY growth in June whichresulted in an upward revision of Q2rsquoseconomic growth 1047298ash estimate of17 YoY
Developers sold 2116 privateresidential units island-wide awelcome improvement of 614 QoQ
even though it was still 206 lowerYoY This was mainly attributableto the strong sales in the OutsideCentral Region (OCR) where 1669homes were sold a 1179 QoQincrease Market activity in the OCRaccelerated in Q22015 due to thesuccess of two newly-launchedprojects ndash North Park Residencesand Botanique at Bartley ndash whichtogether sold a total of 964 unitsamid the weak market sentiment
Although not as signi1047297cant thenumber of units sold in the CoreCentral Region (CCR) almost doubledto 154 units In contrast the Rest ofCentral Region (RCR) recorded a
fall in transaction volumes of 370to 293 units Thus on the wholedemand for private residential homesin the primary market is not out ofthe woods yet as evidenced by thenegative YoY growth
The secondary market howeveris witnessing signs of recovery as1988 private properties changedhands in Q2 growing 479 QoQand 286 YoY making Q2 themost active quarter since theimplementation of the Total DebtServicing Ratio in Jun 2013 Salesvolume increased on a quarterly basisacross all geographic regions (CCR
GRAPH 1
Primary private home sales volumes 2008-Q22015
Source Urban Redevelopment Authority (URA) Savills Research amp Consultancy
762
25964380 3595
65265412
1744 1311
1525
4654
40334444
5402
4538
26652116
1558
5578 3638 4262
5916
2430
1531
419
1860 4241 3603
4353
2568
1376
0
5000
10000
15000
20000
25000
2008 2009 2010 2011 2012 2013 2014 2015
N o o f u n i t s
Q1 Q2 Q3 Q4
TABLE 1
Major new launches Q22015
Source Savills Research amp Consultancy CCR = Core Central Region RCR = Rest of Central Region OCR = Outside Central Region
SNo Project name Developer Location CategoryTotal
no of unitslaunched
Take-up ()Price range
(S$ per sq ft)
1 Botanique at BartleyUOL Development (Bartley)
Pte LtdUpper Paya Lebar Road OCR 500 806 1049-1394
2 Hilbre 28 Development 72 Pte Ltd Hillside Drive OCR 10 600 1027-1546
3 Neem Tree Aylesbury Pte Ltd Jalan Kemaman RCR 24 417 1572-1669
4 North Park Residences North Gem Development Pte Ltd Yishun Central 1 OCR 600 935 1044-1572
5 Pollen amp BleuSingland Development(Farrer Drive) Pte Ltd
Farrer Drive OCR 28 393 1765-2104
6 Westwood Residences KBD Westwood Pte Ltd Westwood Avenue OCR (EC) 480 285 713-902
8202019 Savills- 2Q2015
httpslidepdfcomreaderfullsavills-2q2015 34
August 2015
savillscomsgresearch 03
Brie1047297ng | Singapore residential sales
RCR and OCR) and market segments(resale and subsale markets) Thatsaid the increase in transactionvolume in the secondary market does
not infer that prices have risen Onthe contrary it indicates a certainlevel of stability as buyers return to themarket where sellers have becomemore 1047298exible in their asking prices
Developers have also launched moreunits in Q22015 2099 uncompletedunits were launched an increase of765 QoQ Although the numberof new projects launched has notincreased from the last quarter theprojects launched this quarter arelarger and hence the number ofunits launched is signi1047297cantly higherQoQ The two largest projects arethe Botanique at Bartley and NorthPark Residences which cumulativelyoffered 1100 units By way ofcomparison Q1rsquos largest SimsUrban Oasis and Kingsford Waterbaylaunched only 514 units betweenthem It should be noted that thetotal number of units in the latter twodevelopments is 275 more thanthe combined total (1717 units) forBotanique at Bartley and North ParkResidences The higher launch 1047297guresre1047298ect the developersrsquo con1047297dence intheir pricing strategy and product
PricesThe Q22015 URA statistics revealedthat the non-landed private
GRAPH 2
Savills high-end non-landed home price index Q12005-Q22015
Source URA Savills Research amp Consultancy
0
50
100
150
200
250
Q 1 2 0 0 6 = 1 0 0
residential property index fell 08QoQ its seventh consecutive
quarterly decline Amongst thethree regions the CCR and RCR
experienced the lowest price fallof 06 (CCR for the second
successive quarter) while the OCR
registered a steeper decrease of 11Over the past six quarters RCRrsquos
performance was the most volatileThe price volatility may affect market
con1047297dence as property investors aretraditionally more risk-averse
Similarly Savills basket of high-endnon-landed homes recorded a 05QoQ dip to S$2215 per sq ft Thecurrent price level is 88 below thepeak of S$2429 per sq ft achieved inQ12013
Future Supply The Executive Condominium (EC)
market is expected to see morelaunches in 2H2015 as large projectssuch as Sol Acres are expected toenter the market However with 319out of 6990 uncompleted EC units
TABLE 2
Major upcoming launches
Source Savills Research amp Consultancy Launched in July 2015
SNo Project name Developer Location Category DistrictEstimated total no of
units
1 High Park ResidencesFernvale Development
Pte LtdFernvale Road OCR 28 1390
2 The BrownstoneCanvey Developments
Pte LtdCanberra Drive OCR (EC) 27 638
3 The Vales Anchorvale Residences
Pte Ltd Anchorvale Crescent OCR (EC) 19 517
4 Sol AcresMCL Land (Brighton)
Pte LtdChoa Chu Kang Grove OCR (EC) 23 1327
5 Signature at Yishun Gee-I Investments Pte Ltd Yishun Street 51 OCR (EC) 27 525
6 South Beach ResidencesSouth Beach Consortium
Pte LtdBeach Road CCR 7 190
7 Gramercy Park Aston Properties Pte Ltd Grange Road CCR 10 174
8202019 Savills- 2Q2015
httpslidepdfcomreaderfullsavills-2q2015 44
August 2015
savillscomsgresearch 04
Brie1047297ng | Singapore residential sales
Christopher J Marriott
CEOSoutheast Asia
+65 6415 3888cjmarriottsavillsasia
Phylicia AngExecutive DirectorResidential Sales
+65 6415 3277pangsavillscomsg
Alan CheongSenior DirectorSingapore
+65 6415 3641alancheongsavillscomsg
Simon SmithSenior Director
Asia Paci1047297c
+852 2842 4573ssmithsavillscomhk
Savills Singapore
Please contact us for further information
Savills plcSavills is a leading global real estate service provider listed on the London Stock Exchange The company established in 1855 has a rich heritage with unrivalled growth It is a company
that leads rather than follows and now has over 600 of1047297ces and associates throughout the Americas Europe Asia Paci1047297c Africa and the Middle East
This report is for general informative purposes only It may not be published reproduced or quoted in part or in whole nor may it be used as a basis for any contract prospectusagreement or other document without prior consent Whilst every effort has been made to ensure its accuracy Savills accepts no liability whatsoever for any direct or consequential lossarising from its use The content is strictly copyright and reproduction of the whole or part of it in any form is prohibited without written permission from Savills Research
Savills Research
Jacqueline WongSenior DirectorResidential Leasing
+65 6415 3878 jacquelinewongsavillscomsg
property market Buyers on the otherhand have a different expectationharbouring the hope that prices willfall further and hence they are in a
wait-and-see stance Unfortunatelywith their store of equity rising furtherdisappointment brought on by notseeing prices falling signi1047297cantly mayinduce those sitting on the fence tomake impulsive decisions and committo a purchase
The high take-up for projects launchedrecently like North Park Residencesand High Park Residences pointto a thawing out effect Thereforenotwithstanding a recent comment byK Shanmugam Minister for Foreign
Affairs and Law regarding the falsecorrelation between property coolingmeasures and general elections morebuyers may begin to return to themarket as their affordability level willhave increased while their patience hasrun out waiting for prices to declinefurther or measures to be relaxed
Nevertheless the expected increasein take-up of new projects does notnecessarily mean that normality hasreturned to the market because thebroad brush measures have merelymade the smaller units more affordableto local buyers whereas larger unitsand those with a high price quantummainly those projects in the CCRare not selling fast enough to clearoff the unsold inventory Adopting
launched left unsold competitionamong developers will be evenstronger which will be to the buyersrsquobene1047297t
Looking into the private residentialmarket (excluding ECs) launches ofnew projects may remain subdued asdevelopers still hold a cautious outlookon Singaporersquos private residentialmarket for 2H2015 Howeversuch sentiments may make somedevelopers take an opposite tack tolaunch a phase of their project bytaking advantage of the relatively lowcompetition in the market at prices thatyield them an acceptable pro1047297t margindemand vis-a-vis buyerrsquos affordability
OutlookThe property cooling measures aswell as the Total Debt Servicing Ratio(TDSR) framework have both slowedand deferred sales As it has beentwo years since the implementationof the TDSR framework liquid assetscontinue to accumulate amongsthouseholds and during this waiting outperiod prices have remained relatively1047297rm This means that affordability hasincreased with an increasing number ofbuyers now having the wherewithal toovercome some of the measures With
the General Election expected to beheld before the year ends developerswill also be trying to delay launcheshoping that the authorities will loosensome measures that have gripped the
CCRrsquos average monthly sales for theperiod January to May 2015 andassuming that there will be no furtherGovernment Land Sales (GLS) it
will take about 12 years to clear theinventory of unsold units in projectsunder development now For theRCR and OCR given that the GLSprogramme is usually focused on theseregions the time to clear the stock ofpresent and future unsold units will bemore than 12 years Therefore evenif island-wide take-up rates doubleit will take well over 1047297ve years to selldown the inventory Lowering pricesfurther would not be a panacea toincrease demand because much of theunsold stock are larger units whichbecause of the larger price quantumand the various cooling measures arebeyond the reach of many locals andpermanent residents
Regardless of whether the measuresare relaxed or not we believe that newsale prices will remain 1047297rm and mayeven exhibit some upside bias It is inthe secondary market that prices willremain under pressure as individualsselling their properties lack the clout tomake their unit stand out among thesea of similar units in the secondarymarket The only tool that they have isthe price Consequently the secondarymarket is expected to gain buyingmomentum as this is where buyerscan actually sense a noticeable pricecorrection
8202019 Savills- 2Q2015
httpslidepdfcomreaderfullsavills-2q2015 34
August 2015
savillscomsgresearch 03
Brie1047297ng | Singapore residential sales
RCR and OCR) and market segments(resale and subsale markets) Thatsaid the increase in transactionvolume in the secondary market does
not infer that prices have risen Onthe contrary it indicates a certainlevel of stability as buyers return to themarket where sellers have becomemore 1047298exible in their asking prices
Developers have also launched moreunits in Q22015 2099 uncompletedunits were launched an increase of765 QoQ Although the numberof new projects launched has notincreased from the last quarter theprojects launched this quarter arelarger and hence the number ofunits launched is signi1047297cantly higherQoQ The two largest projects arethe Botanique at Bartley and NorthPark Residences which cumulativelyoffered 1100 units By way ofcomparison Q1rsquos largest SimsUrban Oasis and Kingsford Waterbaylaunched only 514 units betweenthem It should be noted that thetotal number of units in the latter twodevelopments is 275 more thanthe combined total (1717 units) forBotanique at Bartley and North ParkResidences The higher launch 1047297guresre1047298ect the developersrsquo con1047297dence intheir pricing strategy and product
PricesThe Q22015 URA statistics revealedthat the non-landed private
GRAPH 2
Savills high-end non-landed home price index Q12005-Q22015
Source URA Savills Research amp Consultancy
0
50
100
150
200
250
Q 1 2 0 0 6 = 1 0 0
residential property index fell 08QoQ its seventh consecutive
quarterly decline Amongst thethree regions the CCR and RCR
experienced the lowest price fallof 06 (CCR for the second
successive quarter) while the OCR
registered a steeper decrease of 11Over the past six quarters RCRrsquos
performance was the most volatileThe price volatility may affect market
con1047297dence as property investors aretraditionally more risk-averse
Similarly Savills basket of high-endnon-landed homes recorded a 05QoQ dip to S$2215 per sq ft Thecurrent price level is 88 below thepeak of S$2429 per sq ft achieved inQ12013
Future Supply The Executive Condominium (EC)
market is expected to see morelaunches in 2H2015 as large projectssuch as Sol Acres are expected toenter the market However with 319out of 6990 uncompleted EC units
TABLE 2
Major upcoming launches
Source Savills Research amp Consultancy Launched in July 2015
SNo Project name Developer Location Category DistrictEstimated total no of
units
1 High Park ResidencesFernvale Development
Pte LtdFernvale Road OCR 28 1390
2 The BrownstoneCanvey Developments
Pte LtdCanberra Drive OCR (EC) 27 638
3 The Vales Anchorvale Residences
Pte Ltd Anchorvale Crescent OCR (EC) 19 517
4 Sol AcresMCL Land (Brighton)
Pte LtdChoa Chu Kang Grove OCR (EC) 23 1327
5 Signature at Yishun Gee-I Investments Pte Ltd Yishun Street 51 OCR (EC) 27 525
6 South Beach ResidencesSouth Beach Consortium
Pte LtdBeach Road CCR 7 190
7 Gramercy Park Aston Properties Pte Ltd Grange Road CCR 10 174
8202019 Savills- 2Q2015
httpslidepdfcomreaderfullsavills-2q2015 44
August 2015
savillscomsgresearch 04
Brie1047297ng | Singapore residential sales
Christopher J Marriott
CEOSoutheast Asia
+65 6415 3888cjmarriottsavillsasia
Phylicia AngExecutive DirectorResidential Sales
+65 6415 3277pangsavillscomsg
Alan CheongSenior DirectorSingapore
+65 6415 3641alancheongsavillscomsg
Simon SmithSenior Director
Asia Paci1047297c
+852 2842 4573ssmithsavillscomhk
Savills Singapore
Please contact us for further information
Savills plcSavills is a leading global real estate service provider listed on the London Stock Exchange The company established in 1855 has a rich heritage with unrivalled growth It is a company
that leads rather than follows and now has over 600 of1047297ces and associates throughout the Americas Europe Asia Paci1047297c Africa and the Middle East
This report is for general informative purposes only It may not be published reproduced or quoted in part or in whole nor may it be used as a basis for any contract prospectusagreement or other document without prior consent Whilst every effort has been made to ensure its accuracy Savills accepts no liability whatsoever for any direct or consequential lossarising from its use The content is strictly copyright and reproduction of the whole or part of it in any form is prohibited without written permission from Savills Research
Savills Research
Jacqueline WongSenior DirectorResidential Leasing
+65 6415 3878 jacquelinewongsavillscomsg
property market Buyers on the otherhand have a different expectationharbouring the hope that prices willfall further and hence they are in a
wait-and-see stance Unfortunatelywith their store of equity rising furtherdisappointment brought on by notseeing prices falling signi1047297cantly mayinduce those sitting on the fence tomake impulsive decisions and committo a purchase
The high take-up for projects launchedrecently like North Park Residencesand High Park Residences pointto a thawing out effect Thereforenotwithstanding a recent comment byK Shanmugam Minister for Foreign
Affairs and Law regarding the falsecorrelation between property coolingmeasures and general elections morebuyers may begin to return to themarket as their affordability level willhave increased while their patience hasrun out waiting for prices to declinefurther or measures to be relaxed
Nevertheless the expected increasein take-up of new projects does notnecessarily mean that normality hasreturned to the market because thebroad brush measures have merelymade the smaller units more affordableto local buyers whereas larger unitsand those with a high price quantummainly those projects in the CCRare not selling fast enough to clearoff the unsold inventory Adopting
launched left unsold competitionamong developers will be evenstronger which will be to the buyersrsquobene1047297t
Looking into the private residentialmarket (excluding ECs) launches ofnew projects may remain subdued asdevelopers still hold a cautious outlookon Singaporersquos private residentialmarket for 2H2015 Howeversuch sentiments may make somedevelopers take an opposite tack tolaunch a phase of their project bytaking advantage of the relatively lowcompetition in the market at prices thatyield them an acceptable pro1047297t margindemand vis-a-vis buyerrsquos affordability
OutlookThe property cooling measures aswell as the Total Debt Servicing Ratio(TDSR) framework have both slowedand deferred sales As it has beentwo years since the implementationof the TDSR framework liquid assetscontinue to accumulate amongsthouseholds and during this waiting outperiod prices have remained relatively1047297rm This means that affordability hasincreased with an increasing number ofbuyers now having the wherewithal toovercome some of the measures With
the General Election expected to beheld before the year ends developerswill also be trying to delay launcheshoping that the authorities will loosensome measures that have gripped the
CCRrsquos average monthly sales for theperiod January to May 2015 andassuming that there will be no furtherGovernment Land Sales (GLS) it
will take about 12 years to clear theinventory of unsold units in projectsunder development now For theRCR and OCR given that the GLSprogramme is usually focused on theseregions the time to clear the stock ofpresent and future unsold units will bemore than 12 years Therefore evenif island-wide take-up rates doubleit will take well over 1047297ve years to selldown the inventory Lowering pricesfurther would not be a panacea toincrease demand because much of theunsold stock are larger units whichbecause of the larger price quantumand the various cooling measures arebeyond the reach of many locals andpermanent residents
Regardless of whether the measuresare relaxed or not we believe that newsale prices will remain 1047297rm and mayeven exhibit some upside bias It is inthe secondary market that prices willremain under pressure as individualsselling their properties lack the clout tomake their unit stand out among thesea of similar units in the secondarymarket The only tool that they have isthe price Consequently the secondarymarket is expected to gain buyingmomentum as this is where buyerscan actually sense a noticeable pricecorrection
8202019 Savills- 2Q2015
httpslidepdfcomreaderfullsavills-2q2015 44
August 2015
savillscomsgresearch 04
Brie1047297ng | Singapore residential sales
Christopher J Marriott
CEOSoutheast Asia
+65 6415 3888cjmarriottsavillsasia
Phylicia AngExecutive DirectorResidential Sales
+65 6415 3277pangsavillscomsg
Alan CheongSenior DirectorSingapore
+65 6415 3641alancheongsavillscomsg
Simon SmithSenior Director
Asia Paci1047297c
+852 2842 4573ssmithsavillscomhk
Savills Singapore
Please contact us for further information
Savills plcSavills is a leading global real estate service provider listed on the London Stock Exchange The company established in 1855 has a rich heritage with unrivalled growth It is a company
that leads rather than follows and now has over 600 of1047297ces and associates throughout the Americas Europe Asia Paci1047297c Africa and the Middle East
This report is for general informative purposes only It may not be published reproduced or quoted in part or in whole nor may it be used as a basis for any contract prospectusagreement or other document without prior consent Whilst every effort has been made to ensure its accuracy Savills accepts no liability whatsoever for any direct or consequential lossarising from its use The content is strictly copyright and reproduction of the whole or part of it in any form is prohibited without written permission from Savills Research
Savills Research
Jacqueline WongSenior DirectorResidential Leasing
+65 6415 3878 jacquelinewongsavillscomsg
property market Buyers on the otherhand have a different expectationharbouring the hope that prices willfall further and hence they are in a
wait-and-see stance Unfortunatelywith their store of equity rising furtherdisappointment brought on by notseeing prices falling signi1047297cantly mayinduce those sitting on the fence tomake impulsive decisions and committo a purchase
The high take-up for projects launchedrecently like North Park Residencesand High Park Residences pointto a thawing out effect Thereforenotwithstanding a recent comment byK Shanmugam Minister for Foreign
Affairs and Law regarding the falsecorrelation between property coolingmeasures and general elections morebuyers may begin to return to themarket as their affordability level willhave increased while their patience hasrun out waiting for prices to declinefurther or measures to be relaxed
Nevertheless the expected increasein take-up of new projects does notnecessarily mean that normality hasreturned to the market because thebroad brush measures have merelymade the smaller units more affordableto local buyers whereas larger unitsand those with a high price quantummainly those projects in the CCRare not selling fast enough to clearoff the unsold inventory Adopting
launched left unsold competitionamong developers will be evenstronger which will be to the buyersrsquobene1047297t
Looking into the private residentialmarket (excluding ECs) launches ofnew projects may remain subdued asdevelopers still hold a cautious outlookon Singaporersquos private residentialmarket for 2H2015 Howeversuch sentiments may make somedevelopers take an opposite tack tolaunch a phase of their project bytaking advantage of the relatively lowcompetition in the market at prices thatyield them an acceptable pro1047297t margindemand vis-a-vis buyerrsquos affordability
OutlookThe property cooling measures aswell as the Total Debt Servicing Ratio(TDSR) framework have both slowedand deferred sales As it has beentwo years since the implementationof the TDSR framework liquid assetscontinue to accumulate amongsthouseholds and during this waiting outperiod prices have remained relatively1047297rm This means that affordability hasincreased with an increasing number ofbuyers now having the wherewithal toovercome some of the measures With
the General Election expected to beheld before the year ends developerswill also be trying to delay launcheshoping that the authorities will loosensome measures that have gripped the
CCRrsquos average monthly sales for theperiod January to May 2015 andassuming that there will be no furtherGovernment Land Sales (GLS) it
will take about 12 years to clear theinventory of unsold units in projectsunder development now For theRCR and OCR given that the GLSprogramme is usually focused on theseregions the time to clear the stock ofpresent and future unsold units will bemore than 12 years Therefore evenif island-wide take-up rates doubleit will take well over 1047297ve years to selldown the inventory Lowering pricesfurther would not be a panacea toincrease demand because much of theunsold stock are larger units whichbecause of the larger price quantumand the various cooling measures arebeyond the reach of many locals andpermanent residents
Regardless of whether the measuresare relaxed or not we believe that newsale prices will remain 1047297rm and mayeven exhibit some upside bias It is inthe secondary market that prices willremain under pressure as individualsselling their properties lack the clout tomake their unit stand out among thesea of similar units in the secondarymarket The only tool that they have isthe price Consequently the secondarymarket is expected to gain buyingmomentum as this is where buyerscan actually sense a noticeable pricecorrection