830 new residential properties were sold by developers in June this year, up almost 53% from the 536 units last year. Despite the usual June Holiday lull, the number of units sold were not significantly lower than the 1,039 sold in May. The lack of new private property launches last month could have also accounted for the sub-1000-unit sales figures following 3 consecutive months of sales above 1,000 units. Only 159 units were launched in June, down from the 370 in May.
With the inventory of unsold units diminishing, and a much-reduced number of new units launched this year, the market could be headed towards a state of undersupply. Thus, despite of and possibly because of the 15 consecutive quarters of weakening home prices and softening rents, buyers have been eager to pick up units this year.
The best-selling private condominium project in June was The Santorini in Tampines which sold 75 units at $1,026 psf while Sol Acres topped the executive condominium (EC) sector with 41 units sold at $829 psf. Some property experts are attributing the positive sales figures to higher unit prices since recent land bids have been running high. Prices of units at Commonwealth Towers for example stand at a median of $1,899 psf. With more new launches such as that of Martin Modern and Le Quest up in July, market activity could pick up even further.
Prime office rents show promise in Q2
After 9 consecutive quarters of lackluster showing in the prime office rental sector, rents of Grade A office spaces in the Central Business District (CBD) have finally risen last quarter by 1.7% to $8.51 psf per month. In Q1, overall office rents fell 3.4% and vacancy rates also rose slightly.
Offices in the Marina Bay district received the most attention from tenants with a huge increase in take-up. Rents here rose 5.8%, a very positive sign indeed when compared to the 1% decline in the previous month and the fact that 70% of the office spaces in Marina One have already been leased, even before the project reaches completion. Over at Raffles Place, prime office rents also rose 2.5%. Most of the tenants leasing office spaces in Q2 were from the technology, media and telecommunication and financial and professional services industries.
While Grade A office spaces were leased quickly last quarter, the same cannot be said for that in the city fringes and suburbs. Office rents in the city fringes and suburbs fell 0.6% and 0.2% respectively. This could also subsequently effect changes in the city fringe and suburban residential property markets. With property analysts predicting a 5% recovery for the market sector this year, will Q3 continue to show a price-rise?
Woodleigh government land sales site attracts top bids
A 99-year leasehold site on Woodleigh Lane launched under the Government Land Sales (GLS) programme has drawn bids from 15 developers, with a top bid thus far of $700.7 million from CEL Unique Development, jointly owned by Chip Eng Seng Corp and Unique Real Estate. The latter is a joint venture between Heeton Holdings and KSH Holdings. About half of the 15 bids were above price expectations, one-third above the $1,000 psf plot ratio and the top 4 were within the 3.6% margin.
With current market sentiments consistently improving and the potential for a market recovery not impossibly far away, when a choice piece of land comes along, developers have been seen to bid aggressively, especially of late. The 19,547 sq m Woodleigh site is primely located beside the Woodleigh MRT station and near the upcoming Bidadari township which many buyers and investors are keeping their eye on. The site has a maximum gross floor area of 58,641 sq m and residents of the new development may also enjoy the unblocked view of the neighbouring low-rise landed housing area.
Taking into consideration the proximity to an MRT station and other amenities such as the NEX shopping mall, property experts are expecting selling prices of the future residential project on the site to be between $1,720 psf and $1,800 psf. The Bidadari township will prove to be both a boon and a slight disadvantage as the new HDB estate will bring life and activity into the area, but the recent sale of a mixed-use site nearby may bring on the competition. By the time both properties are launched, it will simply be a matter of whether the price is right.
Private non-landed resale property prices continue to rise in June
Photo: 6 Derbyshire
After a couple of quarters of positive performances, resale private home sales have continued on an upward path last month.
June’s resale condominium prices rose by 0.9%, the highest in the last 3 years. In comparison with the same month last year, it has risen by 2.2% and the resale index reached 171, comparable to that in May 2017. Though it may not be the sharp rebound industry players are hoping for, it is nevertheless a positive sign pointing towards possible market recovery.
1,065 private resale condominium units were sold last month, up 51.1% from the 705 units sold in June 2016, but down 12.5% from the 1,217 units sold in May this year. Part of the decline could be due to the June school holidays, as many families and buyers could be out of the country or occupied with other activities. Property experts are expecting the momentum which picked up at the beginning of the year to continue well into the second half of 2017.
The core central region saw a 1.3% rise in resale values, followed by a 1.1% in the suburbs. Prices of resale units in the city fringes remained unchanged but properties in Newton and Novena received the most attention, with buyers paying up to an average of $40,000 above market value for units here. Resale condominiums in district 4 did not fare as well, with buyers paying an average of $120,000 below the median price.
The weakening rental market however continues to weigh heavily on the minds of buyers and investors as competition for tenants in the outside-central-region remains high due to the increased volume of completed properties in these districts.
Site of former Beach Road police station up for sale
Photo credit: National Library Board
There might be an office or shop space standing in what used to be a police station on a 2 hectare site on Beach road soon.
The 99-year leasehold reserved list commercial site was put up for sale by the Urban Redevelopment Authority (URA) recently and one of the conditions of the sale is that the former police station has to be conserved. It has come up for sale because the minimum bid of $1.138 million has been triggered by a developer-offer.
The conservation status of the former Beach road police station may be a plus rather than a setback despite the conservation and construction costs which may be considerable due to the underground linkway. The popularity of heritage sites and indie enclaves may mean this site can leverage on its heritage status to market a unique concept. With the current development of DUO in Bugis and South Beach, there is also hope that activity from the upcoming Kampong Bugis area will trickle into market opportunities at the Beach road site.
The Beach road site has a maximum permissible floor area of 950,592 sq ft and at least 70 per cent of it will be office space, with the rest being retail spaces. In the neighbouring South Beach development, rents stand at $9 psf while those at Marina Bay are at $9.48 psf. With these references, the winning bid is likely to be between $1,400 to $1,700 psf per plot ratio. An estimated 10 bids is expected for the site and tender closes on the 28th of September.
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