Second-timer demand still strong for Lumina Grand EC; expect sales to pick up materially from one month later
- CDL’s 512-unit Lumina Grand (only EC project in 2024) was 53% sold at launch at c.S$1,464psf on average
- EC launch prices to stay sticky as developers are comfortable with this level of pricing and risk
- Expect sales to pick up materially over the course of the year when remaining units are available for second-timer buyers one month later, especially as the next EC launch is slated to be in 2025
What has happened:
CDL launched 512-units Lumina Grand in Bukit Batok (near upcoming Tengah estate), the only EC in 2024. 269 units were sold during the launch weekend, registering a sell-through rate of 53%. Average pricing achieved was S$1,464psf after the S$8,000 early bird discount offered by the developer. Units are a mix of three- to five-bedroom units ranging from 936 to 1,496 sq ft. Apartments are priced from $1.338 million ($1,429 psf) for a three-bedroom, $1.388 million ($1,432 psf) for a three-bedroom premium from 980 sq ft, $1.628 million ($1,427 psf) for a 1,141 sq ft four-bedroom and $2.098 million ($1,402 psf) for a five-bedroom. According to a media report, most buyers opted for the deferred payment scheme (i.e. purchase price will be 3% higher than normal payment scheme) and that the three-bedroom and four-bedroom units were the most popular.
Our view:
The Lumina Grand EC sales during the launch weekend highlighted a few trends: 1) Average pricing was slightly higher than Altura’s (the last EC launched four months ago) despite a lower land price, suggesting that EC launch prices are likely to stay sticky as developers are comfortable with this level of pricing. With margins of >30% based on our estimates, we expect developers to show a sustained interest in the EC market segment and contest keenly for upcoming EC tenders; 2) Lumina Grand’s sales outperformed the two private launches so far in 2024 (The Arcady and Hillhaven), which could give developers more comfort in this “lower-risk” asset class; 3) 30% quota for second-time buyers was fully taken up, which is unsurprising, as these are usually upgraders who are able to use the gains from selling their first public property for the hefty EC downpayment; 4) Out of the 512 units launched, only 23% were sold to first-time buyers, which we pointed out in our previous report that it could be due to EC prices running ahead of affordability given the S$16,000 income ceiling and 30% MSR borrowing limit. Hence, though the sell-through rate of 53% at launch was lower than the previous EC launches, we anticipate sales to pick up materially over the course of the year when remaining units become available for second-time buyers one month later, especially as the next EC launch is slated for 2025.
Comparison against other recent EC projects
| EC project | Land price (S$psf) | Launch date | Sales at launch | Average price at launch (S$psf) | Sales as of 28 Jan 2024 |
| Copen Grand | 603 | Oct 2022 | 73% | 1,300 | 100% |
| Tenet | 659 | Dec 2022 | 72% | 1,360 | 99% |
| Altura | 662 | Aug 2023 | 61% | 1,433 | 88% |
| Lumina Grand | 626 | Jan 2024 | 53% | 1,464 | 53% |
Source: URA, media reports, DBS Bank
Developers’ estimated margins for EC are in excess of 30%
Source: URA, DBS Bank
Comparison against launches in 2024 so far
| Project | Launch date | Sales at launch | Average price at launch (S$psf) |
| The Arcady at Boon Keng | Jan 2024 | 30% | 2,570 |
| Hillhaven | Jan 2024 | 17% (based on total no. of units); 33% (based on no. of units launched) | From S$1,903 |
| Lumina Grand (EC) | Jan 2024 | 53% | 1,464 |
Source: Media reports, DBS Bank