More distressed sales expected at luxury condos

By
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Tay Hock Meng
/ The Edge Property
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November 6, 2015 10:00 AM SGT
It should be reassuring that property agents still consider incidences in which condominiums are sold at 20% to 30% below their purchase price to be as in frequent as an MRT breakdown. Many still insist that such transactions are “one-off” and not representative of the normal market.
“During the global financial crisis, there were similar deals that were done well below market price, but they were also few and far between,” remarks Eric Tay, associate group division director of PropNex Realty. “And these distressed sales are not representative of the rest of the market. For buyers, it’s a good opportunity to find bargains."
One such deal was the sale of a unit on the 20th floor in one of the twin towers at One Shenton condo for $2.36 million, according to a caveat lodged with URA Realis on Sept 21. Based on the floor area of 1,582 sq ft, the price of the three-bedroom unit is $1,491 psf, which is a record low in terms of psf price at One Shenton.
A 1,582 sq ft, three-bedroom unit at One Shenton was sold at all-time-low of $1,491 psf
The transacted price is just 4.8% lower than the price tag of $2.48 million ($1,567 psf) listed by an agent in early September. Compared with the seller’s purchase price of $3.39 million ($2,140 psf) in October 2007, the deal represents a 30.3% drop in price. According to an INLIS filing, the seller was a Hong Kong company.
When listed property giant City Developments Ltd (CDL) previewed the 341-unit condo project in January 2007, prices range from $1,532 to $2,757 psf. “Most of the units were sold at around $2,000 psf then,” says Ku Swee Yong, CEO of Century 21.
Visiting new lows
The three-bedroom unit may have been the first at One Shenton to be sold below $1,500 psf this year, but two other resale deals had traded between $1,500 and $1,600 psf. One was a 1,098 sq ft, two-bedroom unit on the 28th floor that changed hands for $1.75 million ($1,594 psf) in early August. That same unit had fetched $2.24 million...