Property sales slow as cautiousness prevails

Mass-market segment appear to be most affected

WAIT-AND-SEE was the order of the day at showflats over the weekend – the first since measures aimed to cool property speculation were introduced.

The mass-market segment appeared to be the most affected, with thinner crowds and fewer sales. At more upmarket properties, there was still some interest among genuine buyers.

At The Minton in Lorong Ah Soo, a healthy crowd was seen but actual sales were lacklustre. The crowd levels were the same as the previous weekend, but take-up was poor.

Property agents interviewed said overall, the mood seems to be cautious, with most buyers now keeping that home purchase on hold.

Developers appear to have maintained their selling prices at least for now, a move which probably gave buyers another reason to hold back.

At Waterfront Gold,  a Frasers Centrepoint spokesperson said there were no sales done over the weekend. To date, 200 out of 272 units have been sold at an average price of $980 psf.

Over at Seletar Hills, Far East Organization sold eight homes at an average price of $1,065 psf over the weekend at Phase 2 of The Greenwich, a 319-unit leasehold project.

In contrast, 34 units were snapped up in the week from its Phase 2 launch on Aug 23 to Aug 29. It had sold out 174 units in its Phase 1 launch previously.

This hit on the mass-market segment, typically made up of upgraders, had been expected by property analysts.

‘This segment was the star performer this year, so naturally it will take a hit as buying sentiment has cooled as everyone is waiting to see if prices will come down,’ said Chesterton Suntec International research and consultancy director Colin Tan.

The new measures included tighter lending rules for home owners with existing mortgages looking to buy another property. They can borrow up to only 70 per cent of the value, down from 80 per cent. Assuming a price tag of $1 million, buyers will have to fork out an extra $100,000 for the down payment, a hefty sum for an upgrader.

Those who buy an HDB resale flat on or after Aug 30 must also dispose of their private property – including any held overseas – within six months of the HDB purchase.

One buyer, Mr Terence Tan, a 37-year-old flight attendant, said that the higher down payment has made it more difficult for buyers such as himself to upgrade.

‘But if I really like the home and the price is right, I will fork out the higher down payment to secure it,’ he said.

Agents agree that there will still be buyers who will sign on the dotted line if they feel the development is unique enough and will thus keep its value.

Retiree Ng Eng Koon, 65, who was at The Greenwich showflat looking to buy his retirement home, said the new rules will not deter him from buying if he likes a home.

‘No one can predict what will happen now, even the Government. I don’t think the rules will have great impact on genuine buyers, only the investors,’ he said.

Agents added that there will also be some genuine buyers who need homes and cannot wait.

The mid- to high-end market still seemed to attract buyer interest. BS Capital’s The Lumiere at Shenton Way saw a muted crowd, but people were buying.

A property agent said that the project – which has been completed – has not been drastically affected as the buyers ‘can afford to invest’. He had personally sold two units a few days ago, after the new measures were introduced.

Homes at the 168-unit leasehold project are priced at about $2,500 psf.

Another reason for the lacklustre sales activity could be the Hungry Ghost Festival said market observers.

The best time to gauge the impact of the curbs will be when there are new launches, noted Chesterton’s Mr Tan, although this may not be for some time yet as developers are widely expected to put these on the backburner.

‘We have received feedback that buyers are waiting to see if developers will lower their prices, and they might return to the market when this happens,’ said Mr Tan.

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