Updated, Dec 19, 2017, 3:15 p.m., to change number of landed and strata-landed homes sold (owner and mortgagee sales only) in 9M2017 to 19 instead of 20 as previously published. The property at 86 Chestnut Drive was an estate sale and not as previously reported. The error is regretted.
One of the most significant mortgagee sales this year was that of a bungalow on Paradise Island in Sentosa Cove. The six-bedroom waterfront house was completed in 2009 and comes with a swimming pool and private berth. It has a built-up area of 8,800 sq ft and sits on a 99-year leasehold land area of 7,360 sq ft. It was put up for auction by Colliers International in June at an opening price of $13 million.
As there were no bids, the house on Paradise Island was withdrawn from auction. Colliers held a closed tender for the property on Aug 25. The bungalow is said to have been sold for less than $13 million.
Of the 19 landed and strata-landed homes sold at auction from 2011 to 2017 (as at end-September, mortgagee and owner sales only), 12 were mortgagee sales and seven were owner sales, according to Knight Frank Research.
This bungalow on Paradise Island, the first mortgagee sale of a Sentosa Cove bungalow, was sold for just below $13 million in a closed tender (Credit: Colliers International)
In the first nine months of 2016, 42 mortgagee sales (of landed and strata-landed properties) were put up for auction. None were sold under the hammer, based on data from Knight Frank Research. Even when it came to owner sales of landed and strata-landed homes, none of the 52 listed were sold. In the first nine months of 2017, five of the 48 houses listed for mortgagee sales were sold under the hammer. For owner sales, three of the 47 listed were successfully sold.
Number of owner sales versus mortgagee sales done at auctions (2011 to 3Q2017)
Source: Knight Frank Research
Disclaimer: Data as at September 2017, for landed and strata-landed mortgagee and owner sales only
Chart 1: Number of listings and successful sales of houses and strata-landed homes (1Q2016 to 3Q2017)*
Source: Knight Frank Auctions and Knight Frank Research
* Includes re-listings
Chart 2: Total property values of houses and strata-landed homes sold at auction (1Q2016 to 3Q2017) ($ mil)*
Source: Knight Frank Auctions and Knight Frank Research
* Includes re-listings
In terms of total sales value, the difference between mortgagee sales and owner sales was $11.67 million, notes Alice Tan, director and head of consultancy and research at Knight Frank Singapore.
Owners are holding out, as they see that sentiment is now more buoyant and prices are projected to increase, says Tan. For bank sales, interest rate movements will be a determining factor, she adds.
Bigger-ticket properties take longer to be sold. For instance, a GCB on Belmont Road (a mortgagee sale) was first put up for auction in January this year by Colliers International with an opening price of $25.5 million ($1,562 psf). The GCB has a built-up area of 7,200 sq ft and contains four bedrooms, a swimming pool, basement home entertainment centre and car porch for five cars. It sits on a freehold land area of 16,327 sq ft.
This GCB on Belmont Road has been put up for auction six times this year, with an opening price of $25.5 million in January and then $22.8 million in October
The GCB on Belmont Road, which was redeveloped and completed in 2009, was put up for auction for the sixth time at Knight Frank’s auction in October with an opening price of $22.8 million ($1,396 psf).
Tan sees investors turning to real estate as a hedge against inflation and global market volatility. “There’s also the increased confidence in Singapore’s property sector,” she says.
This article appeared in EdgeProp Pullout, Issue 810 (Dec 18, 2017).