Renewed interest in condos at auctions

/ The Edge Property |
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Auctioneers are seeing a “revival” in interest in condominiums in recent months. And it’s not just confined to mortgagee sales of luxury condos either. “It’s happening across the board,” says Mok Sze Sze, head of auctions at JLL.
Buyers are likely to be those who have been sitting on the sidelines and watching the market over the last two years, reckons Mok. “Now that prices appear to be more attractive, they are coming in.”
An example is a 1,055 sq ft unit at Rio Vista, a 99-year leasehold private condo on Upper Serangoon View off Hougang. A mortgagee sale, the unit with two bedrooms and a study was first put up for auction by JLL in April. The opening price was $900,000 ($853 psf). The property was scheduled to be put up for auction a second time on May 28, but was sold before the auction. The transacted price is believed to be close to the opening price, although a caveat has yet to be lodged. The unit last changed hands for $880,000 ($834 psf) in March 2012, according to URA Realis.
The 716-unit Rio Vista was completed in 2004 and is adjacent to the upcoming 1,165-unit Kingsford Waterbay, a 99-year leasehold condo that was launched in March. In May, units sold at Kingsford Waterbay ranged from $1,067 to $1,096 psf, according to caveats lodged last month.
At Knight Frank’s auction on May 21, a 732 sq ft unit at The Plaza on Beach Road was sold for $700,000. It was the first time the unit — also a mortgagee sale — debuted at an auction.
Meanwhile, at DTZ’s auction on May 20, a unit at Fort Gardens had an opening price of $1.6 million, and was sold under the hammer for $1.53 million ($1,061 psf). This wasn’t the first time that the 1,442 sq ft, three-bedroom freehold apartment was put up for auction. It was put up for auction last July, and the opening price then was $2 million. This means the latest transacted price was 23.5% below the initial opening price. The latest achieved price of $1.53 million is still some 23.4% higher than the unit’s purchase price of $1.24 million ($860 psf) in 2009.
The unit at Fort Gardens was a mortgagee sale, and located on the third level of the 15-storey block. The project contains just 69 units and was completed 22 years ago, in 1993. The reason the property took almost a year to sell was because prospective buyers were waiting for the announcement of the location of the Katong Park MRT station on the future Thomson-East Coast Line, says Joy Tan, DTZ’s head of auction. The upcoming station is said to be within a five-minute walk from Fort Gardens.
Another mortgagee sale that also languished in the auction scene for almost a year before finding a buyer was a unit at Stevens Court. The four-storey block at 88 Stevens Road in prime District 10 contains just six apartments and was completed in 1989, some 26 years ago. It is located adjacent to the upcoming Stevens Road MRT station on the Downtown Line.
There had been no recorded transactions at Stevens Court until a 2,863 sq ft, five-bedroom unit surfaced at Colliers’ auction as a mortgagee sale last June. The opening price for the third-floor unit then was $5 million ($1,746 psf). After making its rounds of the various property auction houses, it was sold for $3.5 million ($1,222 psf) in a private-treaty deal brokered by DTZ following its auction in February. The transacted price is 30% below the original opening price.
A unit at Stevens Court was sold in a private-treaty deal for $3.5 million in March, 30% below its initial opening price of $5 million last June
The buyers of the unit at Fort Gardens and at Stevens Court are Singaporeans buying for their own use.
“Buyers today are very selective and careful about their purchases, especially with the property cooling measures in place,” says DTZ’s Tan. “Many are owner- occupiers rather than investors. So, they prefer older condos with more spacious units.”
This article appeared in the City & Country of Issue 680 (June 8) of The Edge Singapore.

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