Developers pondering what might lure buyers back to the market this year already seem to have the answer – reasonably priced homes in good locations.
They only have to look at the turnout at the launches held last year.
Three projects defied the cooling measures to perform exceptionally well at their launch, largely due to pricing and location.
North Park Residences in Yishun sold 486 units at a median price of $1,374 per sq ft (psf) while High Park Residences in Sengkang sold 1,169 units at a median price of $989 psf in their launch months.
In the city fringes, The Poiz Residences in Potong Pasir sold 277 units at a median price of $1,440 psf in its launch month.
“This year, we expect buyers to be equally discerning of new projects. Prices and location should remain the determining factors behind a project’s performance. ”
PropNex Realty chief executive Ismail Gafoor added that a project is highly attractive to buyers when priced towards the lower end for the area it is in. For the suburbs or outside the central region, this would be closer to $1,000 psf, and closer to $1,500 psf for the city fringes or the rest of central region. The core central region would be nearer $2,000 psf.
“However, a premium may be commanded due to the location and availability of transportation – near the MRT – or the nature of the project, such as a mixed development,” said Mr Ismail.
EC IN A PRIME SPOT
Buyers have shown a willingness to pay more for such mixed-use projects, including North Park Residences, J Gateway and DUO Residences. “But for most cases, price is the main factor,” he added.
Mr Ismail noted: “The restrictive loan environment prevents developers from setting a price that is unrealistically high.”
This could be tested towards the end of the first quarter, with the launch of a condo on a site in Toa Payoh Lorong 4 and 6. Response will be used to gauge demand in the area, which has not seen any new launches since the Trevista in August 2009, noted Mr Wong Xian Yang, research manager at OrangeTee.
Another condo launch that will attract healthy interest is a mixed-use development, a good combination of both residential and retail units.
Located at the junction of Upper Serangoon Road and Tampines Road, Stars of Kovan is designed and developed by renowned developer, Cheung Kong Property Holdings Limited.
“This development is just 2 minutes’ walk from Kovan MRT station. Such a well-located project is very rare and will be a strong contender for buyers’ interest,” said Mr Bernard Lee, director for business and research at Huttons Real Estate Group.
Buyers could also target the Wandervale executive condominium (EC), which is in a prime spot in Choa Chu Kang and should be launching later this month, said ERA’s Mr Lim. It is walking distance to the MRT station and bus interchange as well as Lot 1 mall.
Buyer response could be similar to that for The Brownstone EC, which was launched last July and was 48 per cent sold as at end November, making it one of the best-selling EC projects last year, said Mr Wong of OrangeTee.
The Visionaire EC in Sembawang Road and near the upcoming Canberra MRT will be launched around March. The coming months should also see the second phase launch of The Poiz Residences.
Two commercial projects should be launching strata units for sale in this quarter as well – Centrium Square in Serangoon Road and Woods Square in Woodlands Square.