http://www.straitstimes.com/archive/...sales-20140524

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Skywoods condo in Dairy Farm sees slow sales

Published on May 24, 2014 1:25 AM

By Rachael Boon


THE upcoming Skywoods condo in Dairy Farm Heights is having a hard time shifting units as it battles the slowing real estate market and tough competition from other properties in the area.

Sales at the 99-year leasehold project being developed by TA Corporation, Hock Lian Seng Holdings, King Wan Corp and Far East Distillers have been lacklustre.

Units were launched at about $1,250 per square foot (psf) in September last year with only around 78 sales recorded so far at the 420-unit estate.

Eight units were sold in April at a median price of about $1,336 psf, according to Urban Redevelopment Authority data.

The leafy area houses the Dairy Farm Nature Park, with The Rail Mall in Upper Bukit Timah as the main amenity.

Residents in nearby Chestnut and Cashew areas can also head to Bukit Panjang Plaza.

R'ST Research director Ong Kah Seng said: "Pricing at some $1,250 to $1,300 psf might have exceeded the total debt servicing ratio (TDSR) limits of many keen buyers."

He added that it was about time to consider reducing selling prices slightly to move sales as "this is still a good area with strong longer-term price upsides".

But it does not have the field to itself with older, freehold or 999-year leasehold properties with spacious ground nearby such as the Dairy Farm Estate, Hazel Park Condominium with 696 apartments and the 148-unit Cashew Park Condominium.

Dairy Farm Estate in Dairy Farm Road was built in the late 1980s, noted Chesterton Singapore research head Elaine Chow.

She added: "This stretch (of road) is favoured by nature lovers who enjoy the lush greenery right at the doorstep of the nature reserve. It is therefore not surprising to find only four transactions in the past year for the existing residential development there."

The most recent transaction at the 477-unit Dairy Farm Estate was a 1,948 sq ft apartment that sold for $1,042 psf in November last year.

Mr Ong said resale activity has been fairly consistent in the area, with figures for the second half of last year bumped up by good resale interest for the newer 429-unit Tree House, which was completed last year.

Each quarter in 2013 saw between 17 and 30 transactions, while the first quarter this year recorded 11 transactions.

Besides the older condos, the area's new developments include the 496-unit Foresque Residences and the 512-unit Kingsford Hillview Peak.

Ms Chow noted that new launches in the Dairy Farm and the nearby Hillview and Chestnut areas are priced around $1,200 to $1,300 psf while older developments sold at $900 to $1,100 psf.

Mr Ong said rents are still considered affordable, equivalent to typical suburban areas of about $2 to $2.50 psf per month, due partly to the age of the condos and the absence of an MRT station, although Cashew MRT on the Downtown Line 2 is under construction.

Mr Ong is upbeat about the impact the new station will have: "This may support the decision of junior expatriates, foreign working professionals to decentralise to the area to save on accommodation costs. However, prices of properties here have to be pegged at competitive levels to allow investors to reap returns more easily."

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