SINGAPORE - The sale is on for private residential projects in the prime central region, following price cuts for city fringe and suburban projects which helped developers move more unsold units.
Palms @ Sixth Avenue, a strata landed semi-detached project, is offering to absorb the 7 per cent additional buyer's stamp duty which existing Singaporean home owners have to pay for a second residential property.
With this, prices will go from $5.3 million to $4.9 million for a 4,510-sq-ft unit, and from $7 million to $6.5 million for a 5,834-sq-ft one. The discounted prices translate to a per square foot range of $1,086 to $1,114.
The project will receive its temporary occupation permit (TOP) in the first quarter of 2015.
Meanwhile, Hallmark Residences along Ewe Boon Road in Bukit Timah is offering a discount of more than 10 per cent for several of its units.
A 969-sq-ft two-bedder, for instance, will cost $1.9 million, down from $2.1 million. Three-bedders will cost $2.8 million instead of $3.1 million, and four-bedders, $3.5 million instead of $4 million. An actual show unit will be open for a one-day-only viewing tomorrow, an agent told The Business Times.
R'ST Research director Ong Kah Seng said "it was only a matter of time" before core central region (CCR) projects started to cut prices. "They have been left substantially unsold for quite a long time, and generally buyers' interest for CCR projects has been very weak. Well-located projects like these have hefty price tags, and previously, there wasn't the total debt servicing ratio (TDSR) framework limiting large loans. Some buyers like to overstretch their loan limits by buying costly homes with high leasing demand and hence, investment potential. But they can no longer do so after the TDSR."
The TDSR, which requires financial institutions (FIs) to take into consideration borrowers' other debt obligations when granting property loans, is aimed at strengthening credit underwriting practices by FIs and encouraging financial prudence among borrowers.
Developers of CCR projects feel compelled to cut prices as the TOP dates of their developments loom closer, because empty units paint a discouraging picture of the projects and buyers may turn sceptical about their investment potential, Mr Ong said.
Two other condo projects in the city fringes are also re-launching units at lower prices.
8M Residences along Margate Road in the East Coast is offering an 8 per cent direct discount on its one to three-bedroom units.
For instance, an 893-sq-ft three-bedder will now cost $1.6 million, from $1.8 million. Per-square-foot prices range from $1,832 to $2,015, a breather from the median $2,100 psf at which its units transacted until April 2014. Buyers may opt to take a 10 per cent "rental guarantee" package by purchasing at the current price and getting a 5 per cent cash-back from the developer annually for two years - even while renting out the unit and receiving actual rental income.
One Eighties Residences is giving a 13 per cent discount on its two-bedroom units and penthouses, which will now start at $890,000 and at $1.4 million respectively.
Derrick Poh, marketing and communications manager at Santa United, the developer, told BT of the Joo Chiat development: "We've received enquiries, but those didn't turn into sales. Buyers are keeping a lookout and shopping around, expecting developers to reduce prices based on the current market outlook."
In any case, the lull in the June holiday period is driving developers and agents to take any measures they can to move sales, "probably now more so with World Cup fever distracting buyers away from home purchases", Mr Ong said.
This article was first published on June 14, 2014.
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