New private home sales plunge to 16-year low in August

New private home sales plunged to a 16-year record low for the month of August, as developers held back on new launches during the Hungry Ghost month and price-conscious buyers remained sidelined by higher new launch prices, elevated interest rates and cloudy macroeconomic conditions.

- Grace Leong

But sentiment could get a boost from a long-awaited interest rate cut, which could happen as early as this week when the US Federal Open Market Committee meets on Sept 18, along with a still-low unemployment rate, resilient household balance sheets, and low unsold inventory, analysts say.

According to Urban Redevelopment Authority data released on Sept 16, developers released for sale in August 272 new units from earlier projects, down from 616 new units launched in July.

They sold just 208 private homes in August, excluding executive condominium (EC) units, down 63.5 per cent from 571 in July and 47 per cent lower than the 394 units sold in August 2023.

"This is a record low for the month of August since 325 units were sold in August 2008 - 2024 is shaping up to be the weakest in terms of annual new sales since 4,264 units were sold in 2008, with market sentiment cautious since late 2023," said Ms Tricia Song, CBRE's head of research for Southeast Asia.

The January to August 2024 tally of new homes sold is 2,668 units, down 48.6 per cent from 5,190 units over the same period in 2023.