Developer CapitaLand Residential sees a new trend emerging in the high-end property market in Singapore.
The real estate development arm of property giant CapitaLand says two tiers are emerging within the high-end segment – the super-luxury end and the high-end, each with a distinctly different group of buyers.
CapitaLand Residential says Singapore’s property market is booming, especially in the high-end segment.
Ultra-luxurious projects like St Regis and its Scotts HighPark were launched at new benchmark prices, yet the units were quickly snapped up by those for whom price is not an issue.
“I see quite a lot of foreign buyers entering who requested super-large apartments and they want to be in a superb location and with very distinctive design. It has be in a location where the address is the most desired, you must have that address – in that sense they are prepared to pay for it,” said Patricia Chia, CEO, CapitaLand Residential Singapore.
However, the demand is not as strong for the lower tier of the high-end market, which is comparatively more price-sensitive.
“There will be this small selected group of people who would chase the super-luxury end, then there will be some more rational investors who look at this end of the market that has already gone up by so much and say maybe I’ll start to look at something nearby where there’s more upside,” said Ms Chia.
This is the group that CapitaLand believes will help drive growth in the upper-end and have a trickle down effect on the mid-tier market.
“We have seen in our own projects, even the mid-end or mass market, the volume take-up rate has actually increased, and I think the volume will finally translate into a price increase. But it will be gradual and it should improve and trickle down to the overall market,” said Ms Chia.
Going forward, CapitaLand Residential believes prices for the super-luxury end will be above S$3,000 per square foot on the average, and the 2nd tier high-end properties will be priced from S$1,800 to S$2,500 per square foot.
The developer plans to launch up to 1,200 new units this year.
Source: Channel NewsAsia, 29 January 2007