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29-12-06, 13:52
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Published December 29, 2006
Properties put up for auction by owners surge 68%
But mortgagee sales dive 38.8%, helped by an improving economy
By KALPANA RASHIWALA
(SINGAPORE) It's like a tale of two cities in the Singapore property auctions market. While the number of properties put up for auction by owners has jumped 68 per cent this year to a record 600, the number of properties put under the hammer by mortgagees fell 38.8 per cent this year to 1,418, according to latest figures issued yesterday by Colliers International.
http://img404.imageshack.us/img404/9564/bt538406529122006285cd3qj6.jpg
The property consultancy attributed the decline in the number of properties auctioned off by lenders to a more upbeat economy, buoyant property market and high employment rates.
Colliers said the growing trend for owners to put up their properties at auction, shows that they are increasingly recognising this as an efficient way of selling, especially for prime properties like Good Class Bungalows and even prime development sites.
Colliers also said that the total value of properties actually sold at auctions has jumped 49 per cent from about $213 million in 2005 to $318 million this year.
This is the highest level seen since 1999, when $409.5 million worth of properties were knocked down to the highest bidder. The surge this year was contributed largely by the record sale of 12 bungalow land parcels at Sentosa Cove in August for a total of $86.34 million.
Knight Frank, which also released its auctions report yesterday, offered a further reason for this year's strong auction sales - increased investor interest in apartments believed to have collective sale potential.
'They are usually in mature developments that are more than 10 years old, strategically situated in prime locations and are not built to their full development potential as allowed under the new planning regulations in Master Plan 2003.
'Some examples of such auction transactions include a unit in Tulip Garden which was transacted at $1.73 million, a high-end penthouse unit at Silver Tower in Cairnhill sold for $6.12 million, a $1.38 million studio apartment in The Beaumont and a Braddell Heights apartment,' Knight Frank observed.
Generally, these properties were knocked down at a premium compared to recently transacted units in the development, indicating that these buyers have priced in an en bloc premium for these units, Knight Frank said.
The firm predicts that the number of properties put up for auction by owners in 2007 is expected to further catch up with the number of mortgagee properties that go under the hammer. It also suggested that following the successful sale of highly sought-after penthouses at Marina Bay Residences earlier this month through a closed tender, there is a possibility of developers exploring other sales modes such as auction to obtain the highest prices for their properties.
In its report, Colliers highlighted that auction has also started to gain popularity among owners trying to find buyers in the subsale market for uncompleted properties in highly sought-after projects such as The Sail @ Marina Bay, The Arc at Draycott and The Berth by The Cove.
However, the numbers so far have been small. Fewer than 10 such units - or just 0.5 per cent of the total 2,018 properties put up for auction this year - went under the hammer, according to Colliers International executive director and auctioneer Grace Ng. None of these properties was actually sold during auctions, although some may have changed hands afterwards through private treaty deals, she added.
'Most owners will do the actual transaction through private treaty but will use auction as a platform to generate publicity for their properties and source for buyers,' Ms Ng said.
Colliers said the biggest percentage decline in mortgagee properties going to auction was in the office sector, as many owners who were in default with their bank loans were able to find buyers in the open market, thanks to the current shortage of office space.
Published December 29, 2006
Properties put up for auction by owners surge 68%
But mortgagee sales dive 38.8%, helped by an improving economy
By KALPANA RASHIWALA
(SINGAPORE) It's like a tale of two cities in the Singapore property auctions market. While the number of properties put up for auction by owners has jumped 68 per cent this year to a record 600, the number of properties put under the hammer by mortgagees fell 38.8 per cent this year to 1,418, according to latest figures issued yesterday by Colliers International.
http://img404.imageshack.us/img404/9564/bt538406529122006285cd3qj6.jpg
The property consultancy attributed the decline in the number of properties auctioned off by lenders to a more upbeat economy, buoyant property market and high employment rates.
Colliers said the growing trend for owners to put up their properties at auction, shows that they are increasingly recognising this as an efficient way of selling, especially for prime properties like Good Class Bungalows and even prime development sites.
Colliers also said that the total value of properties actually sold at auctions has jumped 49 per cent from about $213 million in 2005 to $318 million this year.
This is the highest level seen since 1999, when $409.5 million worth of properties were knocked down to the highest bidder. The surge this year was contributed largely by the record sale of 12 bungalow land parcels at Sentosa Cove in August for a total of $86.34 million.
Knight Frank, which also released its auctions report yesterday, offered a further reason for this year's strong auction sales - increased investor interest in apartments believed to have collective sale potential.
'They are usually in mature developments that are more than 10 years old, strategically situated in prime locations and are not built to their full development potential as allowed under the new planning regulations in Master Plan 2003.
'Some examples of such auction transactions include a unit in Tulip Garden which was transacted at $1.73 million, a high-end penthouse unit at Silver Tower in Cairnhill sold for $6.12 million, a $1.38 million studio apartment in The Beaumont and a Braddell Heights apartment,' Knight Frank observed.
Generally, these properties were knocked down at a premium compared to recently transacted units in the development, indicating that these buyers have priced in an en bloc premium for these units, Knight Frank said.
The firm predicts that the number of properties put up for auction by owners in 2007 is expected to further catch up with the number of mortgagee properties that go under the hammer. It also suggested that following the successful sale of highly sought-after penthouses at Marina Bay Residences earlier this month through a closed tender, there is a possibility of developers exploring other sales modes such as auction to obtain the highest prices for their properties.
In its report, Colliers highlighted that auction has also started to gain popularity among owners trying to find buyers in the subsale market for uncompleted properties in highly sought-after projects such as The Sail @ Marina Bay, The Arc at Draycott and The Berth by The Cove.
However, the numbers so far have been small. Fewer than 10 such units - or just 0.5 per cent of the total 2,018 properties put up for auction this year - went under the hammer, according to Colliers International executive director and auctioneer Grace Ng. None of these properties was actually sold during auctions, although some may have changed hands afterwards through private treaty deals, she added.
'Most owners will do the actual transaction through private treaty but will use auction as a platform to generate publicity for their properties and source for buyers,' Ms Ng said.
Colliers said the biggest percentage decline in mortgagee properties going to auction was in the office sector, as many owners who were in default with their bank loans were able to find buyers in the open market, thanks to the current shortage of office space.