Fresh mortgagee sale listings hit record high in Q2

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Fresh mortgagee sale listings hit record high in Q2

Aug 3, 2016

Wong Siew Ying


The number of fresh mortgagee sale listings in Singapore hit a record high in the second quarter amid a lacklustre leasing market.

Property consultancy Knight Frank said in a report that 31 fresh listings under mortgagee sale were made in the April to June period. Of these, 21 were residential units and six industrial properties. The other four were offices, shops and shophouses.

In a mortgagee sale, a property is put up for auction by a bank after the owner defaults on servicing the mortgage.

Data compiled by Knight Frank shows only four out of 61 units were sold, making for a success rate of just 6.6 per cent for mortgagee sales - taking into account repeat listings - lower than the 10 per cent in the first quarter.

The four sold were a 19th-floor apartment at Silversea in Marine Parade for $3.9 million; a third- storey unit at Turquoise in Sentosa Cove for $2.92 million; a 23rd- storey unit at One Amber in Marina Parade for $3.7 million; and an industrial unit at Entrepreneur Business Centre for $1.58 million.

Still, sales values in the second quarter climbed 105.9 per cent over the previous quarter to $12.1 million for mortgagee sales.

The firm expects mortgagee listings to remain elevated. "In light of heightened market volatility, freshly listed properties put up for auction under mortgagee sale look set to remain above the 50-unit mark for the second half of 2016," it said in the report.

A further 124 properties were put up for auction - mostly owner's sales. This brought the total number of properties put up for auction in the second quarter to 185, including repeat listings, a jump of 31.2 per cent over the first quarter and up by 0.5 per cent from the year before.

All in, seven out of the 185 went under the hammer in the second quarter, for a total sales value of $14.81 million - up by 48.4 per cent from the previous year.

The other three properties that were sold during the quarter were two apartments at Pine Grove for $938,000 and $1.05 million, as well as a unit at Rio Casa in Hougang Avenue 7 for $730,000.

The first half of 2016 saw $24.43 million of sales closed at auctions - down 46.7 per cent from a year earlier. Knight Frank said the fall could be due to more properties being sold before or after auction via private negotiations. It added that "the residential and shops & shophouses sectors are likely to continue forming the bulk of the properties put up for auction in the remaining months of 2016".

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Fresh mortgagee listings in Q2 set record

Mortgagee sales make up 81.7% of total auction sales in the quarter, says Knight Frank

Aug 3, 2016


A NEW high in fresh mortgagee sale listings was set in the second quarter in Singapore, according to data compiled by Knight Frank.

A total of 31 fresh listings came up in auctions. The residential sector led the way with 21, followed by the industrial sector, six, and the office and the shops and shophouses sectors, two each.

Despite the lower mortgagee sale success rate of 6.6 per cent in Q2 as compared to 10 per cent in the first quarter, the mortgagee sales of four properties surged 105.9 per cent in value from a quarter ago to S$12.1 million, representing 81.7 per cent of total auction sales.

Four properties below S$2.5 million were transacted while three properties between S$2.5 million and S$5 million were sold under mortgagee sale; the latter made up 71 per cent of total value of auction sales in the second quarter.

Including repeat listings, 61 properties were listed for mortgagee sales, with districts 15 and 19 each contributing 15 per cent or more to mortgagee sale listings.

The total 185 properties put up for auction in Q2 represent a 31.2 per cent quarter-on-quarter increase but was a mild 0.5 per cent more than a year ago.

Seven properties went under the hammer. Despite the low overall success rate of 3.8 per cent, total sales value jumped 54.1 per cent from a quarter ago or 48.4 per cent from a year ago to S$14.81 million.

But for the first half of 2016, the S$24.43 million worth of transactions represent a 46.7 per cent decline from the same period last year.

Knight Frank said that this could be attributed to more properties being sold before or after auction.

"Amid a tepid residential leasing market as well as weak retail sentiments, the residential and shops and shophouses sectors are likely to continue forming the bulk of the properties put up for auction in the remaining months of 2016."

A trend divergence could be seen in mortgagee sale listings for prime districts' residential units and that for landed properties.

The number of residential properties in the prime districts of 1, 9, 10 and 11 that are listed for auction was 21, the lowest since Q2 2014. Among these, seven units came under mortgagee sale listing.

On the other hand, the number of landed properties listed for mortgagee sale makes up half of the total 34 landed properties put up for auction - this proportion is a record high. The 17 landed properties on mortgagee sale listings represent a 142.9 per cent surge in number from a year ago.

But all prime properties put up for auction in Q2 were withdrawn.