94% take-up in less than a month. Phase 1 of City Developments’ (CDL) The Arte saw an overwhelming take-up since its launch early this month, as buyers snapped up 170 out of the 180 launched units. Recent transactions imply that in order to attract buyers, the product has to be either
mass market (<> or
shoebox-sized (400 – 800 sf). As such, we are somewhat surprised by the project’s favourable showing, given its relatively
larger size (1,000 – 1,800 sf) and mid market status (S$880 – 1,100 psf).
We also note that the fine performance was achieved in an area which has been mushrooming with new projects of late, i.e.
Nova 48/88, iR Residences, Domus and The Mezzo. More notably, visitors thronged the showflat from 10am to 7pm, with last weekend alone accounting for more than 1,000 people. We observe that visitors and eventual purchasers were mostly Singaporeans, including HDB/mass market condo upgraders, families (with children) and young couples. Our chats with property agents revealed that unlike other smaller projects by niche developers where prices could still be negotiable, CDL stood firm on its selling price.
The Arte’s healthy turnout was mirrored in most of the projects which we visited last weekend, including
The Peak @ Toa Payoh (Total Units: 1,203, Total Visit Count: 22,500),
Lincoln Residences, The Mezzo, The BelleRive and Verdure (60% sold). We believe the current renewed interest in property is piqued by a slew of macro-factors: improved data from the US, recent marked rally within the equity markets and worse-than-expected 1Q09F drop in domestic property prices leading to predictions that the physical market has bottomed. Micro-factors include pent-up demand and Interest Absorption Scheme.
But asset deflation cycle should persist. While we are cognisant of the recent interest in a handful of prime properties (
Illuminaire on Devonshire, The Mercury, Verdure and Gallop Gables), we reckon these small projects do not envelop the still-subdued buying sentiments in high-end projects. While selected investors (i.e. we heard from property agents that four penthouse units from The Mercury were bought by a single buyer at under S$800 psf, significantly under the current S$1,200 – 1,400 psf mark transacted at River Valley area) are gradually entering the market, we believe this trend could only be expedited when the overall economy exhibits more overt signs of recovery and increased foreigners re-enter the playing field.
While we deduce that more investors are now waiting for increased prime projects to be launched at competitive prices, we would like to point out that developers generally do have stronger holding power this time round. As such, we reckon they would continue to landbank their prime district projects, while launching their mass-mid market projects to generate cash-flow. Overall, our view on the physical property market (bottom in 1H10) remains status quo.
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With a project of that age, definitely it requires some maintainance. But with the Mega Mall coming up, I am sure it will become the next Bishan.
Its private preview this coming 25th April Saturday.
Viewing Period: Start from 18 Apr (10am to 7pm)
Eligible buyers of The Peak @ Toa Payoh can take pleasure in such premium living while enjoying incentives such as CPF Housing Grants (for First-timers only), Married Child and Third Child Priority Schemes, exemption from resale levy for 2nd time buyers and Deferred Payment Scheme.
For CCR, 62 units of 67 units launched from The Mecury was sold with median ASP of S$1148psf. Parc Sophia was re-launched at a lower median ASP S$1151psf and sold 26 new units. Top median ASP was from Orchard Scotts with 1 unit sold at S$2220psf.
Some highlights:
BelleRive consists of 51 units in total. 2 bedroom-12 units, 3 bedroom-37 units & 2 Penthouse unit. Brochure for BelleRive can be downloaded here.
In fact, there are still about 7 or 8 new unsold unit available. You can go to the show room and talk to the Far East representatives there. However, those units are quoted at $850 psf (with a high chance of 5% discount), which is much higher than the resale price. So you can get the new one at a higher price or the old one with a lower price.
URA also provided the details for the various geographical regions. Prices of nonlanded private residential properties decreased by 15.2% in Core Central Region (CCR), 17.2% in Rest of Central Region (RCR) and 7.5% in Outside Central Region (OCR). The decreases for Core Central Region and Rest of Central Region were worse than our expectations while the fall for Outside Central Region came in within expectations. We note that buyers have been reluctant in buying high-end and mid-end homes, which are mainly located in Core Central Region and Rest of Central Region respectively. This is because prices have been high and are expected to decline further. Property prices in Rest of Central Region or the suburbs have fallen less due to demand from HDB upgraders who have found the mass-market homes to be more affordable.
Pdf source of index, Pdf source by area.
Interest Absorption Scheme (IAS). The government had scrapped the Deferred Payment Scheme (DPS) to curb property speculation and prevent defaults as the property market slows down. As a result, developers have introduced the Interest Absorption Scheme (IAS) that is similar to the DPS. Under the IAS, buyers sign up for loans and make the 20 percent downpayment when they book property units. They will not have to make progressive payments until the project obtains the Temporary Occupation Permit (TOP). However, they have to pay a premium of about 3 percent for the IAS.
Here is the show room. Due to the curvy outline, you will see some curve shape inside your house too. And most units are big size unit, the smallest 3-bedroom is also 1200 square feet and above. So its price is relatively more expensive.
To find out more: http://www.simlian.com.sg/. But really, this project's units is way too big. There are many unused area in the washroom, which I think is too spacious.
Meanwhile, those shopping around for a property now should keep this checklist in mind:
Illuminaire@Devonshire is a project worth to invest:
4) Capital Appreciation in Year 2012 when the project TOP nicely in time. Expected baseline psf at S$2300 minimum at end 2012 when financial market stabilises.
Showflat for Illuminaire@Devonshire is situated at Kg Java Road, not on the actual development site. At Newton Circus round-about, Kg Java Road is in between Newton and Bukit Timah exit, you will see the showflat on the right after turning in(Previous Parc Centinnial Showflat).
Demand and Supply, are the first principle in economic. So to understand the home price (especially private housing), you need to know the demand. Some one has done a very good analysis, and let me share with you here.
Stock market is rising, but how about the home price? In fact, no one knows the answer. But some economic data may help us have a guess. Lets take a look on the figure on the left for the income per capita versus the property price index. You can see the peak during 1995 and 2007. Since then the property price index fall greatly below income per capita.
