En bloc sales this year hit $975m, gain momentum

En bloc sales in Singapore are gaining momentum as overall collective sales for this year have hit $975 million, according to property consulting firm Jones Lang LaSalle (JLL). About 90 per cent of these transactions came from the residential segment, the firm said.

Improving fundamentals in Singapore’s property market and the widening gap between new sale and resale prices for residential property are reasons for the rise in collective sales this year, said Ms Stella Hoh, head of investments for Singapore at JLL.

“Median prices for new sales average at 48 per cent above that of resale transactions during the first three quarters of 2010. These factors seem to have encouraged owners of older properties to band together and attempt a collective sale of the estate,” Ms Hoh said.

In the third quarter, there have been more than 10 collective sales with a residential component. This is almost double the previous quarter’s transactions. There were no residential en bloc sales in the first quarter.

While investor interest was focused mainly in the Central, City fringe and East Coast locations, JLL noted that a number of successful en blocs were in upgraders’ districts. These include Balestier and Toa Payoh (District 12), Geylang and Eunos (District 14) and Serangoon, Serangoon Garden and Hougang (District 19).

Transaction values have also bounced back, with the largest collective sale to date at $137 million ($1,380 psf ppr) for Meng Garden.

Source : Today – 4 Nov 2010

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