Selective buyers and fewer launches lead to 58.1% drop in April home sales

In April, only 301 units exchanged hands.

Fewer launches and homebuyers remaining to be more selective have led to a 58.1% QoQ drop in new home sales in April.

In April, 301 units, excluding executive condominiums (ECs), exchanged hands.

OrangeTee noted that new home sales volume has fluctuated over the past seven months, indicating that the launch of major projects significantly impacts sales volume.

From January to April, the monthly average of developers' sales was 369 units, lower than the 2022 and 2023 averages of 616 and 556 units, respectively.

"It appears that home buyers are now even more selective than before, no longer showing the kind of urgency and fear-of-missing-out (FOMO) behaviour at show flats that was a feature of the market from the second half of 2020 to the first half of 2022," Knight Frank said.

"Buyers continue to take their time to identify value opportunities when acquiring suitable properties for owner-occupation that suit their lifestyle preferences," Knight Frank added.

Knight Frank said the lower sales this year might also have something to do with the "added distraction of units from projects that sold out a few years ago being resold just before or just after completion."

Citing the URA, Knight Frank reported that sub-sale transactions have been increasing throughout 2023, averaging 324 per quarter—69.2% higher than the quarterly average of 191 units in 2022. This trend continued into 1Q24 with 377 sub-sales.

Next month, Huttons expect sales to be "lackadaisical," amidst the absence of larger launches.

PropNex echoed this, anticipating May to be "fairly tepid" with only two boutique development launches, the 21-unit Jansen House and the 16-unit Straits at Joo Chiat.

Huttons expects May sales to come between 150 units and 250 units.

For the entire year, CBRE remains optimistic about the private residential market, expecting sales to reach around 7,000-8,000 units, an improvement from the 6,421 sold in 2023.

"The buying decision of homebuyers in the new sales market will ultimately be motivated by the quality of a new project, location of the development, and the track record of the developer," Knight Frank commented.