SINGAPORE (Aug 15): Private home sales in Singapore soared to the highest in 16 months in July as buyers rushed to snap up properties hours before curbs aimed at quelling speculation came into effect.

Developers sold 1,724 units last month, the Urban Redevelopment Authority said in a statement Wednesday. That’s more than double the 654 units sold in June and the highest since March 2017.

The government took renewed steps last month to cool Singapore’s property market after home prices posted a second-straight quarter of strong gains, fuelled by aggressive land bids from developers and so-called en-bloc transactions, which is where a group of owners band together to sell entire apartment buildings. Changes to additional buyer’s stamp duty and loan-to-value limits were announced at around 7 pm local time on July 5 and came into force at midnight.

“The strong increase was a knee-jerk reaction as buyers rushed to secure deals,” said Justin Tang, the head of Asian research at United First Partners. “With the new measures in place, as well as rising interest rates and trade tensions, people will be more cautious about buying homes. I expect the next months’ numbers to decline.”

The total number of unsold units in July came in at 11,036, versus 11,148 a month earlier, the URA data show.

Local media reported last month that more than 1,000 units were sold at three projects in just a few hours on the evening of July 5 as developers brought forward condominium launches to allow buyers to lock in deals. Older projects, however, are expected to see a continued slowdown in interest, according to Christine Li, a senior director of research at Cushman & Wakefield Plc in Singapore.

“The cooling measures will definitely weigh on buyers’ sentiment, as shown in the slower take up of existing projects,” she said.

En-bloc Failures
Under the new rules, individuals taking out their first housing loan face stricter borrowing limits, meaning they have to put up more cash upfront. For foreign purchasers of residential property, the additional buyer’s stamp duty increased to 20 percent from 15 percent. For Singapore citizens, the extra charges only apply from their second home purchase.

An index tracking property stocks excluding real estate investment trusts that tumbled 6.4% on the announcement of the curbs has since recovered and is now down 3.4%.

City Developments said earlier this month that developers sold 3,947 units in the first half versus 6,039 units in the first six months of 2017, a 35% decrease. “Likewise, in the last 12 months, over 30 en-bloc attempts were unsuccessful,” it said in a statement detailing the group’s second-quarter results. “As such, the market was already finding an equilibrium.”