Sub-sale prices of some units fall below or near average launch levels
SOME uncompleted residential properties in the prime districts have changed hands recently at prices below that which they were sold initially.
Caspian drew a big crowd at its preview last Friday. It extended its opening hours till 1am and managed to sell 80 units. It sold another 220 units over the weekend. -- ST PHOTO: DESMOND FOOThese may be merely a handful, but it reflects the extent of the damage wrought by the economic downturn on the high-end market, analysts say.
According to data compiled by consultancy Savills Singapore, sub-sale prices at some popular projects are edging close to the average prices sold by the developers.
At several yet-to-be-completed prime projects, many units were even done recently at prices below their launch average.
The data is culled from recent sub-sale deals done at 39 prime non-landed residential projects that were launched from 2005 to 2008. They are located in the core central districts of 1, 4, 9, 10 and 11.
A transaction is known as a sub-sale when a buyer acquires a property and sells it before its completion.
The conclusion: Recent transacted prices for projects that were launched in 2005 remain well above their average launch levels.
But the situation is not so sanguine for buyers of properties that were launched for sale in 2006 or later.
Based on caveats lodged, units at 11 developments that were launched between 2006 and 2008 have come down to below their launch levels.
These include projects that saw overwhelming interest during their launch, such as the 175-unit The Sixth Avenue Residences in Sixth Avenue.
Another project, Duchess Residences in Bukit Timah, attracted numerous buyers during its 2007 launch, with units crossing the $2,000 per square foot (psf) mark. It was the first time homes in the area crossed the $2,000 psf mark in nearly 10 years.
But deals done in the third quarter of last year were well below that level.
A 1,604 sq ft home at Duchess Residences was recently advertised for sale at $1,500 psf.
Explaining the low-priced deals, Mr Steven Ming, the Savills Singapore director for investment sales and prestige homes, said: 'There will always be a few who are forced to sell in a downturn.
'The market is likely to remain choppy in the next quarter or two but at this point in time, there are still a lot of investors who are holding out or have the capacity to hold out for better sale prices.'
Those who have missed out on the bull run are also waiting on the sidelines, he added.
At a few popular projects, prices appear to be edging closer to their launch levels or have fallen substantially from the peak.
Two most recent caveats lodged for deals at Park Infinia at Wee Nam in Lincoln Road were at $1,180 psf for a 969sqft unit and $1,061 psf for a 1,442sq ft unit, compared with prices of up to $1,500 to $1,600 psf last year.
All three caveats lodged last month for One Amber near Amber Road were at $761 psf to $816 psf. This compares with its average launch price of $725 to $730 psf in 2006.
To get to the few buyers these days, sellers appear to be getting more aggressive.
In recent classifieds, there were sellers for The Sea View at Amber Road at $1,030 psf, compared with prices of up to $1,500 psf done last year.
Last Wednesday, one unit at One Shenton in Shenton Way was advertised at $888 psf, compared with its launch price of between $1,500 to more than $2,000 psf in early 2007.
Some luxury condos offered steeper discounts.
A unit at The Orchard Residences was advertised for $2,600 psf while a unit at Ardmore II was put up for sale at $1,750 psf. The Orchard Residences and Ardmore II had sold for an average of $3,301 psf and $2,271 psf respectively at their launch.
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