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Thread: Ghost Month won't spook buyers

  1. #1
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    Default Ghost Month won't spook buyers

    August 23, 2009 Sunday

    Ghost Month won't spook buyers

    Developers go ahead with launches, hoping buying fervour will overcome superstition

    By Jessica Cheam

    Strong buying momentum in the property market is expected to hold up a traditionally slow month of sales in August as the Hungry Ghost Month - the seventh month of the lunar calendar - kicked in last Thursday.

    For non-superstitious home buyers, the good news is developers seem to be going full steam ahead with launches.

    The property market typically goes into a lull during this period, which ends on Sept 18 this year, as many Chinese consider it inauspicious to make housing commitments, move house or start renovation work at this time.

    But practicality often overrides superstition, especially when buyers are presented with attractive options.

    Property consultant Nicholas Mak, who is also a Ngee Ann Polytechnic real estate lecturer, said developers would likely want to 'capitalise on the buying momentum and current positive sentiment' and push the projects out.

    One keenly watched upcoming launch is NTUC Choice Homes' Trevista, located at the junction of Toa Payoh Lorong 2 and Lorong 3.

    The developer told The Sunday Times that the launch will go ahead next weekend, and market watchers are anticipating crowds to swamp the showflat despite the Hungry Ghost festival.

    This is primarily due to the popular location of the 590-unit leasehold condominium.

    Mr Mak noted that it has been more than 10 years since a condominium was launched in Toa Payoh. 'I won't be surprised if there is a long queue. If it is attractively priced, buyers will bite, regardless of superstition,' he said.

    Trevista's marketing agents ERA Asia-Pacific and CB Richard Ellis (CBRE) say the indicative price has not been disclosed by the developer, but Mr Mak reckons it might be priced in the $900 to $1,000 psf range, similar to city-fringe property prices.

    The project of three 39-storey blocks will offer the interest absorption scheme, where buyers can postpone the bulk of payment until completion, which is expected to be late 2012.

    Elsewhere, in Balestier, estate agents have started marketing special previews for freehold condominium Prestige Heights, developed by the Fragrance Group.

    The 18-storey condominium will offer 154 units and is said to be priced from $1,100 psf.

    The seventh month weighed heavily on August sales figures last year - only 325 private homes were sold by developers - but this was also coupled with the impact of the global financial crisis.

    It is expected to have far less impact this year.

    While analysts are predicting that this month is unlikely to match July's stunning figure of 2,767 private units sold, sales will still be healthy, they said.

    CBRE executive director of residential Joseph Tan estimates that 1,500 units will be sold this month.

    This number includes units that are sold from projects that are currently being marketed as well as new projects that will be launched over the rest of the month.

    This number also takes into account that some transactions will spill into September, especially for projects that are launched this week.

    The 1,500 level is healthy, considering that since market sentiment improved in March, the monthly sales from March to June ranged between 1,200 and 1,800 units, said Mr Tan.

    ERA's associate director, Mr Eugene Lim, observed that the profile of buyers has been changing over the years.

    'Things literally came to a standstill five to 10 years ago during the seventh month, but buyers now are younger and are less superstitious,' he said.

    But Mr Mak feels the Hungry Ghost Month will still have an impact to a certain extent.

    'There are some buyers who will still be reluctant to make big commitments,' he said.

    One certainty, he added, is that the period is unlikely to affect prices as developers will not revise prices downwards given the current optimistic sentiment in the property market.

    CBRE's Mr Tan said there will be 12 to 15 projects launched during the lunar seventh month this year, including re-launches.

    'Generally, if it is a good product, at any time of the year, it will be able to sell,' he said.

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    Ghost town for new launches?

    Some developers run scared during Hungry Ghost month

    by Kelvin Chow

    05:55 AM Aug 22, 2009

    IF YOU are thinking of shopping for a private property this weekend, you may find your choices limited, as developers seem to be avoiding the start of the Hungry Ghost month when it comes to launching new projects.

    The Hungry Ghost month - the seventh month on the lunar calendar - is considered by some to be an inauspicious time to buy new property. This year, the Hungry Ghost month began on Thursday and will end on the Sept 19.

    Said Dr Chua Yang Liang, head of research (South-east Asia) at Jones Lang Lasalle: "The cultural taboo is quite strong and developers won't be deviating from it, as the launches are still aimed at the mass market."

    August is also a traditionally low season for property transactions, and Dr Chua said he will not be surprised to see a pullback in property transactions, given the strong sales figures in July.

    But independent property consultant Nicholas Mak said the slowdown in property launches may not be solely due to the Hungry Ghost month.

    "Developers might not have any more projects in their pipeline that are ready for the market, after having pushed out (so many) launches over the past few months," said Mr Mak.

    Mr Chong Hock Chang, general manager of business development and marketing at Ho Bee Investment, said: "We look at the situation before making our decisions to launch a development. As our projects are still pending approvals, we cannot launch them, even if demand is good."

    Ho Bee has four upcoming launches listed on its website.

    Big players like City Developments Limited (CDL) are not launching projects despite the current strong consumer sentiment. A spokesman from Hong Leong Group, the parent company of CDL, said: "The group is not planning any project launches for the lunar seventh month. An upcoming project by CDL will be a 396-unit residential development on the former Hong Leong Garden condominium site."

    NTUC Choice Homes said it will let buyers preview its 39-storey Trevista condo in Toa Payoh next weekend. The 99-year-leasehold project will have a total of 590 units.

    Weekend Today also understands that Singapore Land is expected to launch Trizon, a freehold 289-unit development in the Mount Sinai area, at the end of the month or early next month.

    Mr Colin Tan, head of research and consultancy at Chesterton Suntec International, said that despite the Hungry Ghost period, some developers might want to ride on the current bullish trend.

    "Sentiment is very hot now. Developers will chase the sentiment as it is an opportunity not to be missed," he said. He said that in the property boom in 2007, launches still continued throughout the Hungry Ghost month.

    In August 2007, a record number of units - 1,723 - were sold. However, this record was eclipsed by the 1,825 units recorded in June this year.

    "For the developers that are still holding on to projects that they could not launch during the economic crisis, this is a chance for them to try and sell more units," said Chesterton's Mr Tan.

    "They will not want to risk it by going into a lull, which is why we might see some launches during or towards the end of the month."

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