The property investment sales market continues to manifest upbeat sentiment, amassing a healthy sum of S$9.77 billion in the first quarter of the year, riding through the Government’s property cooling measures, the political unrest in the Middle East and North Africa, and the recent catastrophe in Japan, consultants Colliers International said.
In a report issued yesterday, Colliers said the property investment sales market in the January to March period was led by the residential sector, which contributed a total of S$3.7 billion (37.8 per cent) followed by commercial and mixed-use sectors, which accounted for S$2.26 billion (23.1 per cent) and S$1.83 billion (18.8 per cent) respectively. The industrial sector contributed 12.4 per cent, 5.8 per cent from the hospitality sector and 2.1 per cent of sales came from the others category.
Although the quarter’s sales value was a 20.3-per-cent moderation from the S$12.26 billion garnered in the fourth quarter of last year, it was still notably 67.9-per-cent stronger than the sales attained in the first quarter of last year.
Ms Chia Siew Chuin, director of research and advisory of Colliers International, said: “Market fundamentals remain largely positive despite all the uncertainties. In fact, we have observed developers’ confidence in the investment sales market when they set four record prices in the government land sales (GLS) market – despite the introduction of further property cooling measures during the quarter.”
The first record price was set – in terms of unit land price – for non-landed residential sites in the rest of Central Region, when a consortium led by CapitaLand defeated 18 other bidders in a keenly-contested tender exercise for a 1.2-hectare residential plot located at Bishan Street 14 with its price offer of S$550.1 million. This works out to S$869 per sq ft per plot ratio, which far surpassed the previous record of S$639 per sq ft per plot ratio received for the Ascentia Sky site in the Alexandra Road/Tiong Bahru Road locality in December 2007.
Ms Chia said: “Looking ahead, looming uncertainties stemming from the political unrest in the Middle East and North African regions, and the possible impact of the disaster in Japan on global economies could potentially temper market sentiments.”
She said the ample availability of development sites from the GLS programme and concerns on further market cooling measures – on the back of healthy home sales albeit moderated rising home prices – may lead to more cautious acquisition of private residential lands and collective sale sites.
The higher development charge announced last month by the Ministry of National Development also serves as a call of prudence for developers.
“Nevertheless, the mid-term outlook for the Singapore investment sales market remains positive – on the back of Singapore’s healthy economic fundamentals, conducive investment environment and the prevailing low interest rate environment which will continue to set the stage for property investments,” she said.
Source : Today – 7 Apr 2011