Where are the deals?

With a softening market, the number of properties for sale below market prices are likely to increase. Owners who have over-extended their financials during the peak might find it difficult to make their monthly mortgage payments when rents are declining. Rising interest rates will likely exacerbate the problem. Recently, we have also written articles on the increasing number of distressed sales for luxury condos and landed homes.
If you’re looking to bottom-pick and find these under-valued properties, where do you start? We attempt to help you narrow down your search process by analysing tens of thousands of properties for sale. We segregated apartments and condos into their respective districts and use The Edge Fair Value to assess the fair market prices (Note: The Edge Fair Value is an indicative value based on information provided by subject property, recent past transactions or adjusted listings of similar properties. The methodology is endorsed by professional licensed valuers). Properties with asking prices below 5% of the fair market values are categorised as ‘Deals’.
Table: Deals in the different districts for apartments & condos
All Properties
Resale/Completed Properties
District
Key Towns
# of Properties For Sale
# of Deals
% of Deals
# of Properties For Sale
# of Deals
% of Deals
1
Marina, Raffles Place, Boat Quay
1,314
4
0%
462
3
1%
2
Anson Road, Chinatown, Tanjong Pagar
674
8
1%
209
-
-
3
Queenstown, Tiong Bahru, Commonwealth
1,466
30
2%
169
5
3%
4
Telok Blangah, Harbourfront, Sentosa
1,148
47
4%
436
9
2%
5
Clementi, Dover, Buona Vista
1,291
11
1%
282
3
1%
6
Beach Road, City Hall, Clarke Quay
6
-
-
-
-
-
7
Middle Road, Bugis, Beach Road
976
19
2%
87
4
5%
8
Little India, Farrer Park, Serangoon Road
565
-
-
192
-
-
9
Orchard Road, River Valley, Cairnhill
2,843
39
1%
961
5
1%
Overall, there are 1,285 ‘deals’ or properties listed at 5% below their fair market values. Out of these, 178 properties are in the resale market. Considering developers are beginning to reduce prices on new launches to move unsold units, it is not surprising that majority of these are for projects that have yet to be completed. For example, the highest proportion of deals is in District 28 around Ang Mo Kio & Yio Chu Kang. Zooming in, it appears a substantial concentration of deals are in the Floraville development, a 50-unit freehold project with an average pricing of $1,410 psf. An analysis of district 19, the district with the most number of deals, provides the same conclusion – majority of these are located at La Fiesta and The Vales, projects that are still under construction.
Although a significant number of deals come from new projects, hidden gems can also be found in the resale/secondary market. In district 10 around Holland and Bukit Timah for instance, there are...