Private residential property prices have been subdued, following cooling measures by the government last year.
Overall, they are expected to remain muted this year.
But some analysts have said prices of private homes in the city fringe could start picking up soon.
This is due to new project launches in attractive locations like Commonwealth Avenue, Kim Tian Road and Prince Charles Crescent.
Real estate agency OrangeTee expects units at these developments to be priced upwards of S$1,600 per square foot (psf).
Prices of non-landed private homes in the city fringe — or rest of central region (RCR) — took a sharp hit in the first quarter of this year, falling by 2.8 per cent, according to estimates from the Urban Redevelopment Authority.
Analysts said the drop was largely due to a lack of new launches and sales of units from existing projects which had lower psf pricing. For example, according to caveats lodged, OrangeTee said Bartley Ridge sold 21 units in the first quarter at a median price of S$1,183 psf.
However, property analysts said there could be an uptick during the current quarter, as new projects are released.
Christine Li, head of research and consultancy at OrangeTee, said: “With new launches coming up at RCR, I expect the price to rebound, probably slightly from Q1 level.
“Looking at the sites in the pipeline, the locations, they definitely command a premium. The price point could easily be S$1,600 and above, given that developers have paid high land prices for these three sites.”
Ku Swee Yong, CEO of Century 21 Singapore, said: “If they (developers) plan to move project sales fast, let’s say to achieve 50 per cent sell out within the first two months, they would have to (be) priced at 5 to 10 per cent below current prices, which means pricing from around S$1,300 to S$1,400 psf for the starting price. Kim Tian may have to start higher, S$1,600 plus or even S$1,700 upwards.”
The three projects include Keppel Land’s 500-unit Highline Residences at Kim Tian Road, and The Crest, a 469-unit development by Wing Tai Holdings at Prince Charles Crescent.
Both developers told Channel NewsAsia that the projects are still targeted to be launched this quarter.
Wing Tai added that the showflat may be ready by the end of the month.
The third project is the 845-unit development by Hong Leong, located opposite Queenstown MRT station at Commonwealth Avenue.
Analysts said the Kim Tian Road site has the highest land cost at S$1,163 psf per plot ratio (ppr), followed by the Prince Charles Crescent plot at S$960 psf ppr and around S$883 psf ppr for the site at Commonwealth Avenue.
Analysts said that since the introduction of loan curbs last year, home buyers have become more price sensitive, and in order to move units, developers have to ensure that their projects are priced more competitively compared to other developments in the area, and that probably means taking a smaller profit margin.
Market watchers also expect units to get smaller to keep the overall price quantum affordable.
Citing marketing materials, OrangeTee said that the Commonwealth Avenue project will comprise 612 one- and two-bedroom units — that is over 70 per cent of the total units in the development.
OrangeTee added that the largest apartments at the project are four-bedroom units spanning some 1,300 square feet.
Source : Channel NewsAsia – 2 Apr 2014