Property auction market affected by July cooling measures

The property auction market in Q1 2019 saw a total units’ sales value of $11.57m, said a report by Edmund Tie & Company (ET&Co). This reflects a year-on-year (y-o-y) drop of approximately 42.1 per cent from $53.84m in Q1 2018, which may be due to the after effects of last year’s cooling measures, which have softened the whole market since Q3 2018.

Other reasons for property auction market being affected include the New Year and Lunar New Year festive period in January and February as well as the March school holidays.

Many buyers appear to adopt a wait-and-see attitude, especially with many upcoming new launches, giving buyers a wide variety of choices.

The units sold via auction in Q1 2019, excluding private treaty sales and units transacted before or after the auction, are as follows –

Property Auctioned amount Property type Seller profile
#17-11, Grange Residences,

95 Grange Road, D10

$7,150,000 Residential Mortgagee
#10-05, Haig Court,

160 Haig Road, D15

$1,850,000 Residential Owner
#03-82, Sim Lim Square,

1 Rochor Canal Road, D07

$1,700,000 Commercial Mortgagee
#02-02, LW Techocentre,

31 Toh Guan Road East, D22

$350,000 Industrial Mortgagee
#04-15, Northstar @ AMK,

7030 Ang Mo Kio Ave 5, D20

$520,000 Industrial Mortgagee

The highest transaction done this quarter was mortgagee sale for #17-11, Grange Residences located in District 10 off Tanglin Road. The unit was successfully knocked down after it was offered for the first time at Edmund Tie & Company’s auction on 27 March 2019. With an opening price of $6.85m, a prospective buyer counter-offered with a bid of $6.6m. The unit subsequently attracted a total of 24 bids from several other prospects, ending the auction at $7.15m or $2,507 per square foot (sq ft).

property auction market
image credit: Wikimedia Commons – Property auction market affected by cooling measures said ET&Co

The freehold, 3-bedroom + study unit, which is approximately 2,852 sq ft, is on the 17th level and one floor below the penthouse. It offers an unobstructed view of the Chatsworth Good Class Bungalow Area (GCBA) and the embassies in the area.

Head of auction & sales at ET&Co, Joy Tan, who was handling the sale of the unit commented, “In the ever-changing Singapore landscape, one will never know if a high-rise building may be built in front of your property affecting the views. For example, many buildings in District 1 currently enjoy unblocked sea views. However, with the draft URA Master Plan 2019 being announced for more residential buildings to enter the district, one might worry if their views are indeed permanent. Nonetheless, with our unit at Grange Residences, such a GCBA and embassy cluster is unlikely to be shifted. The new buyer will thus enjoy this breathtaking view for a long time.”

A stone’s throw away from the Orchard Road shopping belt, Grange Residences is located within the Tanglin estate, close to the upcoming Orchard Boulevard MRT station of the Thomson East Coast Line (TEL). Right opposite Tanglin Mall, the development provides residents with amenities aplenty.

Tan also commented, “The successfully auction price of $7.15m is very attractive, given that another 17th level unit in Grange Residences was sold at $8m or $2,805 per sq ft in January 2018. Prices in Districts 9 and 10 are also surpassing $3,000 per sq ft in today’s market, with nearby new launches transacting at approximately $3,500 per sq ft.”

An earlier report by Colliers International said that property auction market in 2018 reached record high amid slower sales.

Colliers said that it expects property auction listings and sales to grow in 2019 as residential cooling measures continue to bite, and interest for non-residential properties grows. The flash report which tracked transactions and listings in the property auction market in Singapore during the second half (H2) of 2018, said properties put up for auction in H2 2018 totaled 634 listings (including re-listings), up by 40% from the first half (H1) and 47% year-on-year (YOY).

This took total auction listings in 2018 to 1,088 (including re-listings), an increase of 35% over 2017 and the highest annual level since the start of Colliers’ database in 2008.

The annual growth was driven mainly by residential and industrial listings, and a record number of properties being put up for mortgagee sales by banks. Of the 1,088 listings in 2018, 43% (or 472 listings) of them were mortgagee listings – this represents a 27% rise in mortgagee listings from 2017. Meanwhile, owners’ listings also witnessed strong growth with 616 listings in 2018, up 43% YOY.

Ms Tricia Song, Head of Research for Singapore, Colliers International, said “Going by our data, the number of mortgagee listings has risen gradually in the last five years, possibly stemming from the bull run in the market in 2011, 2012 and 2013 where some buyers might have snapped up units at elevated prices, and subsequently found themselves unable to service the mortgage payments. This year, we expect property auction listings – both owners’ and mortgagee listings – and sales to grow as cooling measures continue to bite for the residential segment and more owners putting up non-residential properties for sale.”

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Written by Ravi Chandran


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