Find out why 42% home sales rebound is not surprising
It's all in the pricing, says analyst.
According to CIMB, attractively priced projects are consistently the ones drawing demand. The risk of further cooling measures could subside if pricing for projects remains reasonable, but supply pressures remain.
Here's more from CIMB:
Well-priced projects have been the ones drawing demand, which limits policy risks, in our opinion. June’s best-selling projects were priced below S$900psf. Price points for Parc Centros and Parc Olympia in July were also comparable to older launches which saw strong take-up on attractive pricing. Punggol’s A Treasure Trove was launched at a median ASP of S$920psf (Parc Centros: S$924 psf) and Palm Isle at S$860-870psf (Parc Olympia: S$874psf). July take-up for V on Shenton along Robinson Road was also decent with pricing from S$1,700psf. However, we continue to expect supply pressures. Expectations of pipeline supply and physical completions over 2013/15 had been raised in 2Q12: rising vacancy rates are our chief concern.
July’s new private home sales (exc. ECs) grew 42% mom and 40% yoy to 1,943 units, after two months of decline. Island-wide take-up inched up to 110% (more units sold than launched), led by the Outside Central Region (OCR). Stronger sales were noted in all segments: OCR was propped up by Parc Centros (Punggol) and Parc Olympia (Flora Drive), 80% and 42% sold respectively, accounting for almost 700 units sold. Of the 253 units sold in Core Central Region (highest YTD), V on Shenton sold 144 units (28% take-up).