Prime property districts’ prices show 1st fall in 4 years: DTZ

Prime property districts’ prices show 1st fall in 4 years: DTZ

Downward pressure may increase as speculators dispose of units, it says

 

(SINGAPORE) Property prices in the prime districts of District 9, 10 and 11 have registered their first fall in four years and DTZ Debenham Tie Leung believes that this downturn in sentiment could spill over to the non-prime districts.

 

In an analysis of resale prices based on its own basket of properties, DTZ found that prices of private residential properties in Q2 this year reflected the first correction in the past four years, led by non-landed residential units in the prime districts.

 

DTZ’s basket of properties for prime freehold non-landed resale residential homes include Cairnhill Crest, The Pier at Robertson and Botanic on Lloyd and capital values averaged $1,410 per square foot (psf) in Q2 2008, reflecting a 4.7 per cent quarter-on-quarter (qoq) decline. Capital values had remained at $1,480 psf for the two previous quarters.

 

While it should be pointed out that luxury home prices have reached new heights in recent years, DTZ said that it also tracks a separate basket of luxury properties which includes premier developments like Ardmore Park.

 

Outside the prime districts, capital values of freehold and leasehold non-landed resale residential units remained unchanged, averaging $750 psf and $610 psf respectively, holding steady at this level for three consecutive quarters after both sectors registered 7 per cent increases in Q4 last year.

 

And the outlook for rest of the year is likely to be challenging.

 

DTZ said that with high inflation compounding the expected economic slowdown globally, prices of private residential properties are set for further corrections.

 

‘Besides smaller developers, some of the bigger developers are also likely to reduce selling prices to move sales especially for developments that have been on the market for some time.’

 

‘In addition, the sub-sale market is expected to be active with speculators disposing their units, especially those who have purchased multiple units on Deferred Payment Schemes and are most likely to dispose some or all units to avoid stretching their financial limits,’ it added.

 

While some speculators may feel that renting remains an option for them, DTZ said that as rentals come under pressure in 2009-2011 due to the surge in new home completions, it is unlikely that speculators will want to hold on to their units for rental income.

 

DTZ does believe that there was significant wealth creation in the run-up to the recent ‘economic boom’ of 2006 and last year, and there is ‘pent-up demand’ from many who have been waiting for an opportune time to buy. ‘Take-up will eventually pick up when the market senses that prices have bottomed,’ it added.

 

On the pick-up in sales towards the end of Q2 2008 for ‘attractively located and reasonably-priced projects’, DTZ’s executive director (Residential) Margaret Thean said: ‘At the end of the second quarter, we began to witness the return of market confidence and an improved buying sentiment. Some residential projects are enjoying sell-out status while others are being are well-received. This is clearly indicated by the sell-out status of projects such as Suites 123 while Nassim Park, Parc Sophia, Dakota Residences and Clover by the Park received encouraging response.’

 

Source: Business Times

Flash estimates of private residential property prices up 0.4% in Q2

Flash estimates of private residential property prices up 0.4% in Q2

 

SINGAPORE: Private residential property prices rose 0.4 per cent in the second quarter of this year, according to flash estimates released by the Urban Redevelopment Authority.

 

This compares to the 3.7 per cent increase in the first quarter.

 

Prices of non-landed private residential properties increased by 0.2 per cent in Core Central Region, 0.7 per cent in Rest of Central Region and 1.3 per cent in Outside Central Region in the second quarter of the year.

 

In comparison, for the first quarter of 2008, prices of non-landed private residential properties increased by 3.8 per cent in Core Central Region, 3.3 per cent in Rest of Central Region and 3.8 per cent in Outside Central Region.

 

Analysts note the softening prices contributed to a pick up in sales toward the end of the second quarter in some attractively located and reasonably-priced projects launched.

 

On the supply side, as at first Quarter of 2008, there were about 67,700 private residential units in the pipeline, of which about 56,500 new private housing units are expected to be completed between 2008 and 2011.

 

About 42,700 units of the supply in the pipeline (or 63 per cent) had not been sold by developers yet.

 

Said Ms Margaret Thean, DTZ’s Executive Director for Residential: “This is clearly indicated by the sell-out status of projects such as Suites 123 while Nassim Park, Parc Sophia, Dakota Residences and Clover by the Park received encouraging response.”

 

DTZ also foresees further price corrections in private residential properties going forward as high inflation compounds the expected economic slowdown globally.

 

Source: Channel NewsAsia

Healthy weekend home sales as attractive pricing draws buyers

Healthy weekend home sales as attractive pricing draws buyers 

Price levels set below those at nearby units launched recently or not yet completed

 

THE anaemic property market received a shot in the arm during the weekend, with robust sales and buyers keen to show that they will still deal if the price is right.

Suites 123 at Rangoon Road was sold out – a rarity these days – while Oxley Ventures offloaded 50 units of Parc Sophia in Adis Road. Sales were also healthy at Dakota Residences in Dakota Crescent.

 

Market watchers said the sales at these mid-market projects show that homebuyers can be drawn off the sidelines if prices are attractive.

 

‘Buyers will bite if you price your developments below recently launched or yet-to-be completed projects nearby and about 10 to 15 per cent above older properties in the vicinity,’ said Savills Singapore’s director of business development and marketing, Mr Ku Swee Yong.

 

Ho Bee Investment and NTUC Choice Homes have sold more than 80 units of the 99-year leasehold Dakota Residences since Saturday morning.

 

The developers released 122 units in the 348-unit project at an average price of $970 per sq ft (psf) – under the $1,100 or so they wanted a year ago.

 

Said an investor who went to the launch on Saturday: ‘This project is not exactly cheap. What it offers is value for money, especially in view of the makeover plans for Kallang.’

 

Ho Bee’s general manager of marketing and business development, Mr Chong Hock Chang, added: ‘Another reason the project did well in the current market was pent-up demand. It shows that there are people on the sidelines who are waiting to come out to buy at the right price.’

 

Suites 123, a 43-unit development marketed by Huttons Real Estate Group, was sold out yesterday.

 

The 37 residential units next to Little India and Farrer Park MRT station went for $940 psf to $1,277 psf, while the six shop units fetched between $375,000 to $595,000.

 

In the Mount Sophia area, buyers snapped up all 50 flats released at the 152-unit Parc Sophia over the weekend. Prices ranged from $1,500 psf to around $1,650 psf, or between $742,000 and about $1.2 million.

 

Developer Oxley Ventures, which is also behind Zenith in Zion Road and Tyrwhitt 139 in Tyrwhitt Road, offers an interest absorption scheme. It lets buyers postpone the bulk of their payments on new purchases.

 

Listed developer Sim Lian also started sales at the The Amery, a 74-unit development in Telok Kurau at the weekend. It sold 16 out of 39 launched units at an average of $860 psf, or between $1.16 million and almost $2 million.

 

More launches are expected in the next couple of weeks, including mass-market projects such as the 724-unit Livia in Pasir Ris and the 616-unit Clover by the Park in Bishan.

 

Meanwhile, the Strata Titles Board gave the go-ahead yesterday for the collective sale of the 342-unit Minton Rise. Kheng Leong, which bought the site early last year, plans to build 1,300 flats for launch next year.  

 

Source: Straits Times