A thirst for housing sites despite moderate outlook

Inspite of a moderate residential property prospect in Singapore, developers want to rejuvenate their terrain banks because they sit on reasonably lean unsold inventories, experts at OCBC Investment Homework said.

For the executive condominium, Northwave EC and Visionaire EC are in woodlands and sembawang. Especially, there is company demand for mass market sites on which jobs with thoroughly calibrated rates have the potential to offer briskly, the analysts stated, citing the keen competition in a offer last week for the land package at Fernvale Rd.

Recently, Raintree Backyards in Potong Pasir was sold to a joint venture among United Commercial Corp and UOL for the purpose of S$334. two million inside the third good en agr�gat sale this kind of full month.

Understands that the internet site TODAY, sitting down on 201, 405 sq ft using a maximum allowable gross floors area (GFA) of almost 564, 500 sq feet, drew among five and 10 offers.

The 99-year leasehold terrain parcel for Fernvale Rd, released through the Confirmed Set of the second 1 / 2 2016 Govt Land Product sales (GLS) system, sits about about 185, 096 sq ft of land and has a optimum permissible GFA of 5iphon scam, 288 sq ft.

The closely-fought offer attracted 13 bidders and a top put money on of S$287. 1 mil coming from a partnership formed by Sing Wee and Development Hur Development. The price of the winning tender was above expectations somewhat, and the three highest bids were within 1 per cent of each other, the analysts noted.

“The aggressive bidding points to the fact that developers continue to have significant dry powder at their disposal given their generally firm balance sheets and fluid access to capital with low interest rates, ” OCBC Investment Research analyst Eli Lee said.

“The tug-of-war between having capital headroom sit idle and taking a new condominium project in an uncertain residential market is an uneasy one for developers, and all the more so intended for sites awarded under the GLS system since all models need to be completely sold within five years if the Additional Buyer Stamp Duty is to be avoided, ” he added.

At the final end of the first half of the 12 months, the national aggregate of unsold inventories held by developers stood at about 21, 500 models, well below the 10-year average of 33, 500 models, the OCBC Investment Research analysts noted.

“The Fernvale Road site, which is less than 100m from the Thanggam LRT station is attractive because of its meaningful size with a S$620 million estimated gross development value which will move the needle for most developers, ” Mr Lee said.

He also pointed out its potential for strong sales in the absence of competing launches coming up in the area and the successful launch last year of your nearby you, 390-unit Huge Park Homes, 98 % sold at this moment.

“Buyers on the market, however , are sensitive to pricing in fact it is important for builders to work out cost self-control to protect all their margins. All of us note that the winning pool has a development arm which supports in this regard, ” he stated.

The individual residential property index fell 1 ) 5 % in the July-to-September period in the previous one fourth, monday with respect to a display estimate by Urban Redevelopment Authority about, the most effective pace of decline in seven years.

Private house prices currently have declined for the purpose of 12 successive quarters when weak buyer sentiment at this moment, a decreasing economy as well as the continued observance of cooling down measures considered on the residence market. Whenever well-located real estate attractively will be priced, great deal hunters can come into industry in force, thumping up deal volumes and keeping builders hungry for the purpose of land possibly.