Will new projects rescue private residential market from sliding to historic lows?

In September, sales soared by 90% QoQ with one sales launch. 

After months of sluggish performance, real estate experts predict the private residential market could rebound just before the year ends.

"Transaction momentum of new sales could pick up before the holiday season at the end of the year," Knight Frank said.

JLL, for its part, said it is cautiously optimistic for the remainder of the year. 

"Despite an overhang of cooling measures and buyer hesitancy, we anticipate an improvement in sentiment and sales volume," JLL said.

Meanwhile, CBRE expects sales to rebound in Q4, stating that "there are indications of a recovery in sentiment following September’s rate cut."

September's rate cut, alongside better economic news, helped boost buyer’s confidence and new home sales in September, said Huttons.

"The announcement of a 50-basis point interest rate cut in September 2024 by the US central bank could prove to be the shot-in-the-arm needed to move the private residential market," Knight Frank said,

"The larger-than-expected interest rate cut on 18 September may have also lifted buyer sentiment, drawing in previously hesitant buyers now emboldened by potentially more favourable financing conditions," JLL added.

In September, new home sales, excluding executive condominiums (ECs), soared 90% QoQ MoM to 401 units, despite only having one mid-sized project launch during the month,

"Home buyers seem more optimistic after last month's interest rate cuts. There was a notable resurgence of buyers in the market, especially after the conclusion of the lunar ghost month," OrangeTee said.

According to OrangeTee, there was a widespread uptick in sales volume last month across various previously launched projects.

With buyers returning to pick up units at previously launched projects and a  varied pipeline of new launches to come, PropNex is "optimistic that developers’ sales could finish the year on a brighter note compared with the sluggish performance we observed earlier in 2024."

OrangeTee echoed this saying the increase in new home supply in the final quarter of this year will bolster housing demand.

Projects to be launched in the last quarter of the year include Norwood Grand, The Chuan Park, Arina East Residences, Nava Grove, Emerald of Katong, and Union Square Residences. 

|Many of these projects are situated in the suburbs, providing more affordable housing options for home buyers. These developments are expected to be especially attractive to HDB upgraders, particularly those who have recently sold their flats at high prices," OrangeTee.

While experts are optimistic about the market’s performance for the remainder of the year, CBRE and Knight said 2024 could see the lowest annual new sales since 2008 when 4,264 new homes exchanged hands.

JLL said September year-to-date, new home sales reached 3,077, a 42.3% YoY drop, falling 20.0% below the previous historical low of 3,845 units recorded in the same period of 2008 during the global financial crisis (GFC).