Are We facing an Oversupply in Singapore New Condo Launch 2020?

Updated on 29 November 2019

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Are we facing an Oversupply in New Condo Launch?
On 6th June 2019, the Government said to cut the supply of government land sales by 15%.

MAS flag

MAS Flags loan risks amid rising home supply

Homebuyers and investors to take extra care before taking on a mortgage given the uncertain economy. 

The warning from MAS yesterday also pointed to the large supply of unsold units that could weigh on the property sector.

How many Supply is in the Pipeline?

Do you know why the government wants to do so?
According to MND, the demand has continued to fall since the introduction of the property cooling measures in July last year.
Furthermore, there is a large supply of around 44,000 private housing units in the pipeline. So what does this mean?

Is this the First Time we face High Supply?

They are actually telling you that there are 44,000 of private homes going to obtain TOP in the coming years. Usually we have no idea about all this figure unless we have a comparison with the past history, right?

So, I compare them with the year 2015-2016 because that was the period that has the highest supply in the recent years. From the graph given by URA, there are already more than 50,000 units obtained TOP in 2015 and 2016. And the property market is still able to absorb that. Therefore, with the higher population in 2023, do you think the demand can absorb the supply which is lower than what we had before in 2016?

How about the Vacant Units?

In addition, the news also mentioned there are around 24,000 existing private housing units that remain vacant. So again, what does this mean?
Meaning there are nobody staying in these 24,000 units. However, the vacant units have gradually decreased from the past to 6.3% in the 1st quarter of 2019. Now with the 93.7% occupancy rate of private housing in Singapore, this is considered as healthy situation.

Which Segment has the Lowest Supply?

Take a look at the existing and upcoming new launch (in the video), with over 90 projects for your choice, I’m sure you will be hesitate which project to choose right?

That’s very common especially if you’re the first time buying property.

Take the second look (in the video), you will notice that most of the developments are higher end above $1,500psf.

With my rough work, 20% of them are above $2,500psf, 12% between $2,000psf to $2,500psf, 49% between $1,500psf and $2,000psf, and only 19% are below $1,500psf.

All these percentage are derived from the number of total units. Usually the more affordable ones will sell first. So, do you think next year the supply of new condo launch below $1,500psf will be more? or less?

Besides that, the new launch ECs are hitting $1,000psf-$1,200psf. That makes the new launch condo below $1,500psf to be the icing on the cake.
But like what I said in my previous video, there is no one project that fits everyone at all time. Buying at the right timing, select the right project and unit are very important.
Now, if you are unsure about which project has the highest potential gain, feel free to contact me for free discussion. I’m Stephen Chong at +6591887652. Thank you for watching.

Plan For Yourself is very Important!

To do all these researches are time-consuming and it keeps updated every after.

As a lot of people never plan anything before going to showflat and end up paying more.

I suggest we have a short meet up first where I can share with you based on your case and what is the best scenario moving forward and based on the market now what are the projects best suit you!

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