UNDER THE HAMMER: Sentosa Cove bungalows see more mortgagee sales

/ EdgeProp |

August 18, 2018 8:45 PM SGT

In the latest sign of distress in Sentosa Cove, more waterfront villas are surfacing as mortgagee sales at auctions. Owners with less holding power are seeing their properties foreclosed by banks, says Sharon Lee, head of auctions at Knight Frank.

On the other hand, some bungalow owners who have been spooked by the latest property cooling measures implemented on July 6 have withdrawn their properties from auctions for now and are looking to adjust their prices, adds Lee.

Three Sentosa Cove bungalows have surfaced on Knight Frank’s private treaty list, of which two are mortgagee sales. One is a bungalow at 17 Coral Island. The three-storey house has a built-up area of 8,697 sq ft and comes with four en-suite bedrooms, a maid’s room, an infinity pool and a private berth. It occupies a 99-year leasehold, 7,557 sq ft site. The detached house has a price tag of $11.5 million, or $1,522 psf based on land area.

The waterfront villa is one of 21 developed by Ho Bee Land on Coral Island and completed in 2007.

Waterfront villas on Coral Island in Sentosa Cove (Picture: Samuel Isaac Chua/The Edge Singapore)

The other mortgagee sale is at 7 Paradise Island. It was put up for auction by Edmund Tie & Co in July at an opening price of $14.8 million ($1,603 psf). As there were no bids, the waterfront bungalow is now available for sale by private treaty. The asking price is still $14.8 million.

The three-storey villa has a built-up area of 10,936 sq ft and sits on a land area of 9,235 sq ft. The house has seven en-suite bedrooms, a private swimming pool and a private berth.

Paradise Island is also developed by Ho Bee Land and has 29 waterfront villas completed in May 2009.

The first mortgagee sale on Paradise Island was the house at No 17. It was put up for auction by Colliers International in June last year with an opening price of $13 million ($1,766 psf). It was later sold by private treaty for $14.68 million ($1,993 psf) in November, according to a caveat lodged then.

Some owners are also testing their properties on the market in Sentosa Cove. One such owner has a bungalow on Pearl Island. The three-storey detached house comes with a basement entertainment room, six en-suite bedrooms, a home lift, a swimming pool and a private berth. The property has a built-up area of 5,830 sq ft and occupies a 99-year leasehold site of 7,287 sq ft. The bungalow has a price tag of $16 million ($2,196 psf) and is marketed by Knight Frank on a private treaty basis.

Waterfront bungalows on Pearl Island in Sentosa Cove (Picture: Samuel Isaac Chua/The Edge Singapore)

The owner of the house on Pearl Island is said to be a Singaporean who lives there. The house is one of 19 on Pearl Island developed by Chinese developer Ximeng Land and completed in 2012.

The Singaporean owner had purchased the villa in 2010 for $16 million ($2,200 psf) too, according to a caveat lodged with URA Realis then. He tested the market in July last year when he put his home up for sale at $16.5 million ($2,264 psf).

In 2016, the co-founders of Evia Real Estate, Singaporeans Leslie Lim and Vincent Ong, purchased 10 bungalows on Pearl Island in a bulk sale for $130 million ($1,600 psf).

They subsequently spruced up the houses and offered them for sale. One of the houses on Pearl Island was sold by Evia Real Estate last year for $16.6 million ($1,851 psf), according to a caveat lodged in June last year. Another house was said to have been sold for more than $2,100 psf this year, although a caveat has not been lodged.

Demand for Sentosa Cove bungalows has fallen since 2011 after successive rounds of property cooling measures, says Steve Tay, CBRE senior vice-president of resale and a specialist in marketing luxury homes in Sentosa Cove. He believes that the recent spate of mortgagee sales could revive interest in the luxury waterfront enclave.

The bungalow on Paradise Island was first put up for auction by Edmund Tie & Co in July for $14.8 million ($1,603 psf) (Picture: ET&Co)

“Sentosa Cove bungalow prices today represent a discount of more than 40% from the peak prices achieved in 2010,” says Tay. In terms of absolute prices, the most expensive bungalow was 30 Paradise Island, which was sold for $36 million ($2,403 psf) in May 2010, he adds.

Tay believes the luxury residential segment still needs time to find a new equilibrium after the latest cooling measures. “It is possible prices may fall in the coming months,” he says. “However, the extent of the fall will be determined by how low sellers are willing to price their properties.”

The latest property cooling measures implemented on July 6 with higher additional buyer’s stamp duty on foreigners and second as well as subsequent home buyer’s means there will be fewer buyers hunting for property. “The market has shifted in favour of homebuyers,” says Knight Frank’s Lee. “Now is the best time to pick up a bungalow in Sentosa Cove.”

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