A resale private condo market respite

3 consecutive months of rising private non-landed home prices is reason enough for some mid-year cheer. Could this be a sign of respite from the recent property market lull?

GramercyParkProperty seekers and buyers who have been on the lookout for good deals and the right opportunity to jump back onto the property investment train have proven to be more active of late. Incentive schemes for various residential developments such as OUE Twin Peaks and Ardmore Three have also helped boost sales and prices. The former’s deferred payment scheme has received positive response from buyers, which ultimately translated to sales. The number of resale units sold in May rose by 36% with 840 units sold. 619 units were sold in April.

Prime central region properties are once again finding favour with investors as they view the potential value of the private residential properties here with new eyes. The next launch in the core central region (CCR) would be Gramercy Park luxury apartments by City Developments.

Property analysts are however cautious about their predictions for the rest of the year as the cooling measures will still mean buyers continue to be price-sensitive. They are expecting resale private apartment prices to fall 3 per cent across the board this year.

 

Cool moves to boost property market take off

Property buyers and investors are certainly flexing their shopping muscles this year by weighing their many options carefully and taking time to do so. It has been the buyers’ market for sometime now, with sellers and developers realising that the ball is over in the other court.

Twin Peaks2Purchasing activity has certainly not ceased, but buyers are taking their time to shop their options, with most seeing about 10 to 15 units before taking the plunge. Thus interest is definitely still evident, but the speed and volume of sales may have to take a backseat for now. Some developers have taken to new and creative ways to push sales. OUE for example has offered a deferred payment scheme for their 99-year leasehold condominium Twin Peaks. The move has helped them sell around 100 more units since end March and also put them in the race against freehold properties nearby such as Ardmore Three and Gramercy Park. Average prices at Twin peaks stand at $2,300 psf while units at Ardmore Three are going for around $2,700 psf and the upcoming Gramercy Park has prices set at around $2,600 psf.

LloydSixtyFiveIn a move to help their customers tide over property cooling curbs, in particular the Additional Buyers’ Stamp Duty (ABSD), the developer of Lloyd Sixty-Five, TG development, is offering an “experimental purchaser scheme” which allows the buyer to pay only 12.5 per cent of the purchase price to occupy the unit without having to pay the maintenance fees and property tax for a stipulated period of time till such time when the property cooling measures may be lifted.

What do home buyers value?

Location and price. The first is a well-known fact, that the better placed the property, the higher the demand and hence also the price. But home buyers are also keeping a close eye on their budget and the total quantum price could be the make-or-break factor when it comes to sealing a deal.

NorthparkResidences2Photo: Northpark Residences

Developers have been quick to catch on to this and the launches which sold quickly and well last year were those in the vicinity of a MRT station, school or shopping mall and affordably priced. Mixed-use developments such as Northpark Residences and The Poiz Residences were especially popular. Northpark Residences has sold 486 units at the $1,374 psf average while The Poiz Residences sold 277 units at $1,440 psf. Other mixed-use developments buyers seemed out include J Gateway and DUO Residences.

Home buyers’ appetite have signalled a trend towards $1,000 psf for suburban homes, $1,500 psf for city fringe properties and $2,000 psf for homes in the central regions. They are however more willing to pay more for mixed-use residential properties or those nearer MRT stations or bus interchanges.

WIsteria YishunPhoto credit: thewisteria.net

There will be a number of new launches such as 183 LongHaus in Upper Thomson and The Wisteria in Yishun coming up within this first quarter of the year, and it will be a time to watch as it will set the tone for the rest of 2016.

 

 

October shows dip in resale private home prices

In the current market, where sentiments and demand are weakened by the property cooling measures, it might be idealistic to wait for the market to climb back to its peak in 2009 and 2013. But angle of decline for resale properties has been gentle, with a 7.6 per cent fall from January 2014.

26 NewtonPhoto: 26 Newton condo apartment

Though resale private home prices have dipped since then, the lowered prices may have brought more buyers back into the market. Resale properties or condominiums which were new launches between 2010 and 2012 have relatively larger floor area and in the current market, and buyers who are looking for a permanent home may find the fact that they have higher bargaining power a more-than-valid reason for approaching the resale property market.

Properties in the city fringes fared better as they are priced much lower than city centre properties, and yet offer the proximity or a good location and hints at exclusivity. Resale prices here have fallen just 5 per cent since the highs in 2013. This region has always been popular with investors and owner-occupiers and the lack of new launches here of late may have raised the number of resale transactions.

Suburban resale properties are facing a slightly different situation as the large number of new units have decreased the leasing and resale demand. Fiercer competition may have caused some owners to lower prices, more so than ever, buyers and tenants are finding the ball in their court.

Rise in private condominium rental

Could the market be turning on its heels, headed up the charts? Vacancy rates have been falling as the number of rental properties finding tenants have been on the rise.

Property analysts are however not positive about the numbers. They have attributed it to statistics more than the actual market sentiment. Rental rates have instead fallen 1.7 per cent in Q1, which could show that the number of new occupant-ready properties entering the market last and this year may have shaven a chunk off the property rental pie. From now to 2018, almost 67,300 new units will flood the market, giving a possible indication of how the market will react in the months or even years to come.

AstoriaParkCondoLocation nevertheless still has the ability to bring rental prices up a significant notch. At the Astoria Park condominium near Kembangan MRT station for example, rents have risen for the first 3 months of the year. Older condominiums may have a battle at hand as newer properties offer fresher facilities; though the proximity to amenities, transport nodes and schools may put the former right back on the tenants’ maps. Landlords of older developments may also have an upper hand in their option of coming down on prices since they may have purchased the units at a lower cost.

As more new residential properties come into the fold in the months ahead, the symbiotic relationship between rental and sale prices could become more obvious and things may seem a lot clearer then.

 

Almost all Lake Life EC units sold

At $799 to $930 psf with starting average prices of $685,000 for a 2-bedder to close to $1 million for a 3-bedder, units at the Lake Life EC in Jurong flew of the shelves over the weekend. Only 12 out of its 546 units  were available as of yesterday.

Lake Life ECThe palatable quantum prices of units at the executive condominium (EC) by Evia Real Estate could be the main draw. With a lower loan limit and other cooling measures in place, property buyers are now on the lookout for properties with a lower total selling price rather than focusing on per-square-foot prices. Evia Real Estate has done their homework well, and projected that the deepest pockets of buyers for the Lake Life, according to the demographics of the Jurong district, would be not more than $1.1 million. The pent-up demand for ECs may also have accounted for much of the rush for units in this quickly developing region. The Jurong and Jurong Lake district looks set to be one of the newest and busiest areas for development under the government’s island-wide growth plans.

URA Jurong Lake District

Photo credit:URA

In fact, some of the buyers were originally considering private properties in the area but decided instead to go for the EC options instead. Many saw it as a good investment even though they were purchasing units to live in for the moment. Executive condominiums are a hybrid between public and private property and can be sold after a 5-year minimum occupation period (MOP) in the open market. After 10 years, it will become a private property and may fetch even higher prices.

The other 2 ECs entering the market at the same time are Bellwoods and Bellewaters, developed by Qingjian Realty.

100% condo sales few and far in between

Rare are the new condominium launches which see a “Fully sold” sign plastered on their boards within a few months of launch. Though most may eventually reach a 100% sale status, they are taking longer to do so. This depends on the location of the property and the number of units available for sale, of course, but so far, the top scorer has been Seasuites in Pasir Panjang Road, at 85 per cent of its 52 units, with an average psf price of $1,650.

Seasuites condominium in Pasir Panjang.

Seasuites condominium in Pasir Panjang.

A strong runner-up in the race is Urban Vista in Tanah Merah. Considering it just launched mid-March, this 582 unit condominium project is selling exceedingly well with 77 per cent already sold. Average prices are $1,350 psf. March’s other big launch, D’Nest in Pasir Ris also sold a cool 76 per cent of its 912 units at $920 psf.

Private condominiums are still selling well, with new trumping resale. But there are 9 more months left of the year, and what will keep or halt the sale momentum? Chances are new properties which check the right boxes will win the race:

1. Good location
2. Competitive pricing
3. Comparison of other residential projects nearby

In 2012, most of the properties which reached a fully sold status were launched in the early part of the year, and most of them were one or two-bedders or studio apartments. Will 2013 see a reprise of last year? Or will the cooling measures change it up?

Old Gold – Queenstown

Not only are home buyers going for glistening new properties, they are now getting more savvy and willing to pay to be in areas with a heritage. Which means areas such as Tiong Bahru and Queenstown are seeing a property boom.

Alexis @ Alexandra Condo

As one of Singapore’s oldest townships, Queenstown, with its proximity to the city, has seen a huge increase in interest and sales. Made up of mostly HDB flats, it is not surprising then, that earlier this quarter, an executive maisonette went for $1 million. Private condominium apartments are few and far in between, namely The Anchorage, Queens and Alexis @ Alexandra. The last in the list only recently received its temporary occupation permit (TOP) this year. Prices of private homes here have risen 5 to 7 per cent and now cost between $1,200 psf and $1,700 psf. At Queens condominium, prices have already risen from $700 – $900 psf to $1, 200 – $1, 400 psf. Home rental prices in this estate range between $3 to $4.50 psf per month.

With the One-North cluster filling up fast in the nearby Buona Vista, could this possibly direct even more property traffic in the Bukit Merah-Alexandra Hill sub-zone? Under the government land sales programme (GLS), 2 plots near the Queenstown MRT Station were recently released and perhaps we could expect a growing number of private condominium units in this area.