But sustained activity of prospective investors and homebuyers doubted as some may be sidelined in May.
Developers' sales volume breached the -unit mark in April. The new units sold is the second highest level recorded since monthly figures were released by the URA in June 2007. The highest sales volume was achieved in July 2009 when developers sold some new units, according to a Colliers International report.
The successful launch of three projects - Waterbank at Dakota and The Interlace (release of more units) in the Rest of Central Region (RCR) as well as CDL's Tree House project located Outside Central Region (OCR) - was the key driver of April's robust primary market activity. Together, these three projects accounted for nearly half of developers' sales volume during the month.
Of significance, RCR achieved record sales in April, with some new units taken up. This was driven mainly by the successful sales of Waterbank at Dakota and The Interlace, which combined accounted for 68.7% of all units sold by developers in RCR in April.
Apart from the continued optimism in economic and employment prospects, buyers could also be motivated to lock-in their purchases now in anticipation of a rise in interest rates in the second half of the year.
In terms of pricing, there was a surge in non-landed transactions (ex-EC) occurring at the “S$ per sq ft and below” level in April, compared to the previous six months. Besides the prevalence of units launched at this price band, the concentration of purchases at this price band and the dip in transactions occurring at “Above S$ per sq ft” level could be early signs of the setting in of buyers' resistance towards pricier non-landed homes.
Notwithstanding, the priciest new unit sold in the month was a unit at The Orchard Residences, which achieved a sale price of $ per sq ft. The last time a sale was seen at prices above the $ per sq ft level was in October 2009 when a unit at Boulevard Vue was sold at $ per sq ft.
Outlook for May 2010
Developers are expected to continue pushing out their projects to capitalise on the current strong buying momentum.
Although prospective investors and homebuyers are expected to remain active in the market, motivated to commit before interest rates rise or for fear of being priced out of the market, some may be sidelined by the jittery stock market performance in May, while others may prefer to wait for future launches from the recent spate of Government Land Sales.
As such, while May's launch and sales volume is expected to stay robust at above the -unit level, they are unlikely to cross the -unit mark seen for April.
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