Six projects with 3,500 new homes to hit market in November as developers rush out launches 

A SLEW of new condominium projects are slated to be launched in the next few weeks, with developers pushing out projects to catch the wave of rising sentiment ahead of the year-end holiday season.

Six projects, with 3,551 units among them, will be booking sales in November, in an extraordinary crush of new launches in a single month. In the first six months of 2024, developers marketed 2,485 new units (including executive condos), and another 1,325 units in the third quarter.

Four projects – Chuan Park, Nava Grove, Emerald of Katong and executive condo Novo Place – are scheduled to be launched on Nov 16. Union Square Residences has brought forward its sales booking start to Nov 9 from its original Nov 16 date, agents told The Business Times; The Collective at One Sophia will book sales from Nov 6. All will be starting previews this weekend.

Marcus Chu, chief executive officer of ERA Singapore, said: “The last time we saw such a wave of launches was in July 2018, when developers brought forward their launches, including Park Colonial, Stirling Residences and Riverfront Residences, in a reaction to an announcement of cooling measures.” 

The current rush by developers to get their new projects out the door comes on the heels of recent launches that clocked strong sales, and official data showing that overall private home prices had dipped 0.7 per cent in Q3.

Nicholas Mak, chief research officer at mogul.sg, said: “It’s like a deluge after the drought.”

The latest economic data has also improved the outlook. Singapore’s third-quarter economic growth is likely to be revised upwards following better-than-expected factory output in September, economists said, with Q3 GDP growth expected to come in at between 4.6 and 4.8 per cent. Fresh jobs data also point to Singapore’s employment growth having more than doubled in Q3, and retrenchments fell.

Union Square Residences in the city fringe, by CDL, is offering 366 units at prices ranging from just under S$2,900 per sq ft (psf) to about S$3,700 psf. 

MCL Land and Sinar Mas Land, which are behind the Pine Grove project, Nava Grove, have set prices starting in the S$2,200-to-S$2,300 psf range.  

Two other projects launching on Nov 16 are large developments – Kingsford’s 916-unit Chuan Park near Serangoon Gardens estate, and Sim Lian’s 846-unit Emerald of Katong in the East Coast. And Hoi Hup Realty and Sunway Developments will launch the 504-unit EC project, Novo Place in Tengah.

SingHaiyi is likely to be the first one out the gate, with a Nov 6 sales booking start date for The Collective at One Sophia, where 367 apartments are being built on the redeveloped Peace Centre site. Prices are expected to start in the S$2,500-to-S$2,800 psf range.

Recently marketed new projects logged strong sales over their launch weekends. ERA’s Chu said: “The recent launches of 8@BT, Meyer Blue, and Norwood Grand recorded some of the strongest sales performances of 2024, indicating that buyers are returning to the new home market in a significant way.”

CDL’s Norwood Grand sold 84 per cent of its 348 units at an average selling price of S$2,067 psf. UOL’s freehold Meyer Blue moved half its 226 units at an average price of S$3,260 psf; both its penthouses were sold during its October launch weekend.

Some 53 per cent of units at Bukit Sembawang Estates’ 8@BT, the first launch after the US Federal Reserve delivered an oversized interest rate cut in September, were sold at launch at an average selling price of S$2,719 psf.

Amid improving sentiment, analysts anticipate a strong pick-up in home sales in the last quarter, and are optimistic that real estate agencies will record improved earnings. The earnings of PropNex and ERA’s parent Apac Realty, which operate Singapore’s biggest real estate agencies, fell in their respective first half-year on weak sales.

OCBC Investment Research initiated coverage of PropNex on Oct 21 with a “buy” rating and a target price of S$0.91. 

OCBC said: “There has historically been a positive correlation between the growth of private home prices and Singapore’s real gross domestic product (GDP).” Singapore’s economy gained momentum with a 4.1 per cent increase year on year in Q3, based on advance estimates.

Even before the market started to pick up in September, DBS maintained its “hold” call on PropNex and Apac Realty, with both companies having reported lower first-half profits in August. UOB Kay Hian analyst Adrian Loh reiterated his “buy” call for PropNex that month, even as he lowered its target price from S$1.04 to S$0.96 on the back of weaker sales in the first half. 

RHB analyst Vijay Natarajan, who tracks Apac Realty, believes a turnaround is in sight and upgraded his call from “neutral” to “buy” in September. His target price remains at S$0.42.

Latest government data showed that while the overall price index slipped 0.7 per cent for Q3, home sales were up 9.3 per cent on the quarter to 5,372 units. With the new launches lined up for the last quarter of the year, market watchers are expecting the index to swing back into positive territory.

RHB’s Natarajan said: “We expect primary transaction volumes in 2025 to recover by 50 per cent or more.” Much of the new launch supply is coming out of projects that were pushed back due to soft market conditions and delays in planning and approvals. Lower interest rates will also make housing loans more affordable, he said.  

DBS Group Research analysts Derek Tan and Tabitha Foo had said in a flash note in August: “We expect the exciting line-up of new launches ahead to potentially rejuvenate the market, and we believe the latter half of the year will outperform H1 2024 sales volumes.”

For H1 2024, Apac Realty’s profit fell 18.7 per cent to S$4.1 million from S$5 million in the year-ago period. It noted that margins from resale and rental transactions were lower than those from new home sales. 

PropNex’s profit for its first half fell 13.8 per cent to S$19 million, down from S$22.1 million the year before. The group said the drop reflected the lower number of private new home sales amid fewer launches in the primary market.

About 6,500 private residential units are expected to be launched in 2024, versus the roughly 2,000 units launched in H1. “Given the timing of commission payouts by developers, revenue and profit recognition will happen only in the first half of next year,” said UOB’s Loh.