Developers to go ahead with launches after govt says not tweaking measures

SINGAPORE – With the government confirming that it is too early to start relaxing property cooling measures, analysts said this will lend more clarity and certainty to both developers and home buyers.

One developer has decided to go ahead with plans to launch a new project at the end of March.

The Santorini showflat is being built in preparation for its launch later this month.

The development comprises 597 units, of which about 56 per cent are one- and two-bedroom apartments.

Its developer MCC Land Singapore is rolling out the project after the government said during this year’s Budget that it will not be tweaking the property-cooling measures just yet.

Mr Richard Nah, senior manager at MCC Land Singapore, said: “By removing the speculation that there would be more measures or removal of other measures, it gives us this certainty. The market is achieving some sort of equilibrium, it has somewhat stabilised and there is no need to delay any launches.”

MCC Land said it has yet to set the selling price for the project, but land cost alone is S$562 per square foot per plot ratio.

Mr Donald Han, managing director at Chesterton Singapore, said: “Looking at mass market segment, as what we saw in recent launches in Sengkang West for Rivertrees, for Riverbank, generally the price range hovered between S$1,000 and S$1,100 per square foot (psf). We think that probably will set the precedent for those which are in outlying suburban mass market segments.

“If you are looking at those that are nearer to the rest of central region, for instance Ang Mo Kio or in Bishan area, price trend tends to be S$1,250, maybe S$1,350 psf.”

Meanwhile, market watchers said one project to look out for is Highline Residences, a development by Keppel Land at Kim Tian Road.

Property agents have already started marketing the project but pricing details are not available just yet.

SLP Research estimated that units there could cost up to S$1,900 psf because looking at sales transactions of other properties nearby, SLP said the average unit price in the area has never crossed S$2,000 psf.

Twin Regency, a freehold project went for an average price of S$1,774 psf based on sales caveats from February 2013 to February 2014.

Mr Nicholas Mak, executive director at SLP International Property Consultants, said: “Some of the projects that are going to be launched in the next few months, the land were acquired about a year ago so the land cost and construction cost have already been locked in. So that gives developers very little flexibility to reduce prices as the break even cost is already fixed.”

With the property measures still intact, some analysts said new home sales could come in lower at about 11,000 to 13,000 units this year. That is down from 15,000 units in 2013 and 22,000 units in 2012.

Analysts also said that the recent changes to Housing and Development Board resale procedures are unlikely to affect upgrader’s demand for new homes.

Channel NewsAsia