Originally Posted by
Leeds
SINGAPORE] After going into deep freeze since the additional buyer's stamp
duty (ABSD) was introduced on Dec 8, resale transactions of completed
private homes snapped back to life in March. The recovery was partly
disguised amid the first quarter figures, weighed down by dismal volumes in
January and February.
In fact, Savills Singapore's analysis shows that resale volumes for March
have recovered to levels seen before the ABSD kicked in. The turnaround was
sudden, as the resale market had remained jittery even while buyers were
returning to property launches in the first two months of the year.
However, since March, agents say that some of the eye-popping per square
foot (psf) prices achieved at new launches have helped to jumpstart interest
in the secondary market for completed properties, where prices look more
attractive.
Savills' analysis of URA Realis caveats data shows 1,142 resale deals for
private homes (excluding ECs and en bloc sales) done in March - double the
565 caveats for February and more than three times January's volume of 314
transactions. The March number also exceeds December's volume of 776 and
November's 981.
"Given that the average monthly resale volume for 2011 was 1,166
transactions, the March numbers show that resale volumes have recovered back
to pre-ABSD levels," said Savills Singapore research head Alan Cheong.
The March 2012 resale volume is still 23 per cent below the 1,480 caveats
lodged in March 2011.
The final tally for March 2012 could rise as more caveats stream in over the
next few weeks. Savills' analysis, based on caveats captured by URA Realis
as at April 24, also showed 332 resale transactions being done so far this
month.
Savills commented: "The pace of resales in April is still healthy. Agents
are still conducting frequent viewings and enquiries. Barring any new
property cooling measures or external shocks, resales should remain robust
for the next few months - given the current low interest rate environment,
liquidity and increasing population scenario, among other factors."
The weak performance in the first two months dragged down the volume of
resale deals of private homes for Q1 this year to 2,021, a decline of nearly
25 per cent from 2,688 in the preceding quarter and a year-on-year drop of
42.3 per cent from 3,503 units in Q1 2011.
"When the ABSD was imposed on Dec 8, 2011, new home sales practically froze
in the following weeks. Subsequent to the successful launch of Watertown and
Parc Rosewood in January, resale buyers took a while to fully absorb the
fact that the property market still has legs. Only in March did they put pen
to paper," said Mr Cheong.
Agents report that high prices achieved for 99-year leasehold suburban
launches like Watertown in Punggol (with median prices of about $1,340 psf
in February and March) and Sky Habitat in Bishan, which marked a new record
for the suburban condo market based on an average price said to be about
$1,650 psf after taking into account the initial 3 per cent discount given
to all buyers - have helped to stir interest in the resale market and in
projects launched earlier that are still being marketed by developers.
Archipelago, a five-storey, 99-year condo facing Bedok Reservoir Park, is
going at about $1,000 psf on average.
Compared to Sky Habitat, resale prices for some completed freehold
properties in the prime districts would appear attractive to some buyers,
say agents. For example, a 990 sq ft ground floor unit at One Jervois
changed hands for $1,515 psf (reflecting an absolute price of $1.5 million)
in March, while a 947 sq ft unit on the third floor of Jervois Regency sold
for $1,361 psf (about $1.29 million) in April.
A 12th floor unit of 2,250 sq ft at Residences@ Evelyn changed hands at
$1,609 psf in March, while a 2,508-sq ft fourth floor unit at Chelsea
Gardens at Walshe Road sold for $3.8 million, which works out to $1,515 psf.
David Neubronner, director of residential project sales, Jones Lang LaSalle,
said: "Completed freehold properties at Meyer Road and in Districts 10 and
11 priced at $1,500-1,600 psf represent good values for owner occupiers."
Although psf prices are higher for new launches, absolute price quantums are
generally bigger for older completed projects as units are mostly larger.
"Buyers of resale properties may be a different group than those buying in
the primary market; they could be better heeled," suggests an agent.
Credo Real Estate executive director (residential) Manjit Gill says the
company has seen an increase in enquiries and requests for viewings of
completed properties in the resale market, particularly those in the
vicinity of new launches.
"While psf prices are lower in the resale market, buyers would have to make
full payment of the purchase price upon completion of sale (usually in three
months) whereas if they buy a unit from a developer in a newly launched
project, progress payments can stretch over the three years or more that it
takes to complete the project," he adds. Lower psf prices in the resale
market may also be due to the age of the project and its facilities.