Second quarter property sales by auction more than doubles

SINGAPORE — More properties were sold and at lower prices by the auction method in the second quarter, even with the last week yet to be completed, in line with greater buying interest in the sector.

While there are still auctions to be held in the final week of June, property sales totalled S$13.76 million so far in the second quarter — up 134 per cent from S$5.87 million in the first quarter and double the S$6.8 million in the second quarter of last year, said real estate services firm JLL on Tuesday (June 28).

The property consultancy observed that buyers are still on the lookout for a good deal in the residential sector, although the price is above the “usual sweet spot” of S$1 million to S$1.5 million. They also managed to pay less than previous owners.

A unit at the Silversea condo in the east was auctioned off at S$3.9 million, compared with the S$4.78 million the previous owner had paid; while one at Turquoise at Sentosa Cove was sold at S$2.92 million, compared with the S$5.45 million that was previously paid. Another unit at One Amber was sold at S$3.7 million, down from the S$4.42 million previously paid.

Mortgagee sales made up 66.7 per cent of the units sold by auction in the second quarter. Contrary to the stigma often associated with auction (it is aligned with financial difficulties) owners are now more open to putting their properties under the hammer, noted JLL.

There has been a regeneration of interest in this method of sales. In the past two years, mortgagee sales amounted to more than 65 per cent of total transaction numbers.

Out of the six units sold, five were residential while one was an industrial property, reversing the unusual trend in the first quarter, when only one out of the six deals done was for a home.

JLL suggested that sharp increase in residential units sold could be due to Parliament reinforcing during Budget 2016 (in late March) that it would still be too soon for Singapore’s cooling measures to be lifted, thus reigniting buyers’ appetite for properties.

Private home prices in Singapore surged more than 60 per cent after the global financial crisis in 2009, to peak in the third quarter of 2013. Since then, prices have declined 9.1 per cent over 10 consecutive quarters, according to Urban Redevelopment Authority data.