Straits Times: Mon, Oct 31
A LARGE supply of mass-market homes is set to enter the market by the end of this year, as developers push out a wave of new launches to cash in on recent healthy buying momentum.
The rush to push out projects is also being sparked by worries that the global economic slowdown might affect buyer sentiment, said property experts.
These 99-year leasehold projects are mostly from the flood of suburban state land released by the Government over the past year as it attempted to cool robust home-buying demand from first-timers and upgraders.
At least five larger suburban projects are expected to be launched by the end of this year. Together, the projects represent some 3,000 units.
Far East Organization, CapitaLand, City Developments, UOL Group and Sim Lian Group are just some of the developers that have been gathering interest for their projects recently.
Sim Lian's 452-unit Parc Vera at Hougang Avenue 7, for example, was launched at the weekend.
Agents told The Straits Times that a healthy 70 per cent - or about 130 units - of the 180 units released were snapped up by mostly local buyers.
Units at the four 18-storey condominium blocks were sold at an average of $800 per sq ft (psf) to $850 psf, they said.
This new launch comes quickly after 882-unit A Treasure Trove next to Punggol MRT Station - also a Sim Lian project - was released early last month. It is now more than 85 per cent sold.
Experts said developers are eager to quicken their pace of launches over fears of a deteriorating economic outlook.
They said mass-market projects may also be affected by a fresh batch of suburban land supply expected to enter the market.
The Government Land Sales Programme for the first half of next year is expected to be launched by the end of the year.
With some recent residential tenders attracting lower bids than sites previously sold in the vicinity, this has also sounded alarm bells for some builders.
Mr Tan Kok Keong, OrangeTee's head of research and consultancy, said the new sites sold pose competition if they are priced lower. As such, developers are eager to launch sites they might have acquired at a higher price.
UOL and CapitaLand are gathering interest for their new projects in Bedok.
UOL is expected to preview its 577-unit project - including 24 strata-titled semi-detached houses - at Bedok Reservoir Road by early December, with estimated average prices of about $1,100 psf.
CapitaLand's 583-unit Bedok Residences, next to Bedok MRT station, is also expected to be launched by the end of next month.
The development will have one-bedroom to four-bedroom units with 17 penthouses of between 2,540 sq ft and 2,992 sq ft.
It is expected to be priced higher than Far East Organization and Frasers Centrepoint's Waterfront collection near Bedok Reservoir, as its location is superior, agents said.
The latest launch in the series, Waterfront Isle, sold nine units at a median price of $1,153 psf last month.
City Developments is also joining the party, with agents gathering interest for 892-unit The Palette at Pasir Ris Grove.
Prices are expected to start from $570,000, with three-bedroom units ranging from 1,055 sq ft to 1,066 sq ft priced between $880,000 and $950,000, according to marketing materials.
Far East is also likely to launch The Hillier at Hillview Avenue by the end of this year. The company is holding a presentation and feedback session for potential buyers of the Soho - small office, home office - concept project on Sunday.
Experts said that pricing will be key in determining if this slate of mass-market launches do well.
PropNex chief executive Mohamed Ismail said that although mass-market homes have powered new private home sales since the cooling measures were introduced last January, the question is whether this supply can be absorbed continually.
'They must be priced right to sell, maybe at about $900 psf. If it crosses the $1,000 psf mark, depending on location, if it is close to an MRT station, interest might still be positive... But the take-up rate is now slower,' he said.
New private home sales rose a higher-than-expected 21 per cent last month, with buyers snapping up 1,631 units.
Suburban homes made up 81 per cent of total sales.
Source: The Straits Times © Singapore Press Holdings Ltd.
Martin Koh/ Sherry Tang