Tuesday, September 20, 2011

EC sales perk up with revised income ceiling

SALES of executive condos (ECs) have picked up strongly just days after the higher income ceiling for eligible buyers was backdated to include all unsold units.
Developers have reported quicker sales since last Wednesday's announcement that the revised household income cap of $12,000 - up from $10,000 - would now apply to five other EC projects with unsold units.

The higher ceiling had initially applied only to EC projects launched after Aug 15, when the announcement was made.

ECs are a hybrid of public and private housing, reintroduced to the market last year after a five-year hiatus.

Qingjian Realty said that more than 50 units had been snapped up at EC project RiverParc Residence in Punggol since Wednesday, with the 'majority' of buyers falling into the newly eligible $10,000 to $12,000 income bracket.

This brings total sales to 468 units - or 93 per cent - of the 504-unit project.

City Developments' (CDL) 602-unit Blossom Residences in Segar Road also found buyers for 20 units over the past week, bringing total sales to 400 units.

Mr Chia Ngiang Hong, CDL group general manager, said that about half of these additional buyers are from the $10,000 to $12,000 income segment.

'We expect to see continued healthy sales based on the positive feedback from this group of potential buyers that the latest government announcement is beneficial as it offers them more choices for their selection,' he added.

Similarly, buyers also more than doubled in number compared to a normal weekend before the revised ceiling at United Engineers' 540-unit Austville Residences in Sengkang, a spokesman said.

About 350 units or 65 per cent of the 540-unit project launched in January have been sold, with visitors at the showflat also doubling over the weekend.

'In particular, we saw quite a large number of interested buyers, who were previously disqualified due to their combined household income exceeding $10,000, coming back to our showflat to make a purchase,' he added.

The spokesman added that the firm is positive about the outlook of ECs in the future. Moreover, new EC launches in the past year are better designed and promise a higher building quality, he said.

'With increased incomes and widespread aspirations of living in a condominium among Singaporeans, young couples and HDB upgraders will always consider ECs as a housing option, especially when EC prices continue to be below those of private condominiums.'

The 406-unit EC project The Canopy in Yishun, which had only about 30 units left last week, also experienced a larger-than-usual crowd at its showflat.

MCC Land managing director Tan Zhiyong said, however, that the new ruling would have little impact on the project's sales as fewer than 30 units were left unsold. About five units were sold over the weekend, he added.

The new ruling meant that about 600 more unsold units from five earlier EC projects - as well as units from the most recent EC project launched on Aug 31, Arc at Tampines - are available to buyers who meet the new income requirements.

They can now tap an estimated 68,700 additional households that qualify for ECs when the cap was lifted to $12,000, UOB Kay Hian property analyst Vikrant Pandey estimates.

Since the EC scheme returned last year, eight sites have been sold to developers. In all, 4,194 units have been released into the market for sale and over 3,000 more units are expected to be launched in the next 12 months, a Kim Eng research note said last week.

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