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Trading in ultra-luxe homes slows
PANDEMIC or not, trading in the most expensive homes in Singapore has continued. But hitting the 2019 volume is unlikely as buyers have become more selective.
There are many buyers for good class bungalows (GCBs), the most prestigious type of landed property in Singapore. But at that level, these individuals are also selective, said Henry Lim, ERA head of GCB division.
''They are looking for the opportunity to buy the property of their choice which is within their budget and they feel prices should be softer because of the pandemic,'' said Mr Lim.
Caveat data shows a total of 23 bungalow deals up to Sept 11, 2020, said Han Huan Mei, List Sotheby's International Realty (ListSIR) research director. Caveats are not filed mainly because the buyer does not need to take a bank loan and does not wish to disclose his identity.
The total investment amount is S$474.31 million, lower than the same period in 2019 when there were 28 bungalow deals which amounted to S$533.71 million, she said. For the full year 2019, there were 40 deals worth S$782 million.
The circuit breaker period which lasted from April 7 to June 1 would be a key reason for fewer deals as only five deals were done in Q2 2020 compared to 10 in Q2 2019, said Lewis Cha, ListSIR executive director. Property viewing was only allowed to resume from June 19 onwards, during Phase 2 of the reopening of the Singapore economy.
The most expensive deal so far this year (not caveated) is said to be for an old bungalow sitting on 101,550 square feet of freehold land along Garlick Avenue, a GCB area. The buyer was reportedly the family of Singapore billionaire Goh Cheng Liang, and the property was sold for around S$93 million, according to The Business Times.
Brokers say that it is difficult to say that GCB prices have fallen this year as each bungalow is different when it comes to key characteristics of the property, such as the building size, age and contour of the land.
And location is critical, with Nassim Road regarded as the cream of crop, followed by White House Park, Dalvey Estate and Cluny Park, the GCB areas surrounding Nassim Road, said Ms Han.
''In my opinion, even with the Covid-19 pandemic that contributed to a technical recession in Singapore, the average price of GCB proved to be very resilient,'' said Mr Lim. ''Many sellers are still pricing high their GCB, but on a softened stand,'' he said.
DURING the good times, a seller may ask for S$10 million and he wouldn't budge if the offer was S$9.8 million; in fact he may even jack it up to S$11 million. In today's market, the seller may let go for S$9 million, said Mr Lim.
In August, an old bungalow on Bukit Sedap Road, off Holland Road, that went for S$18 million or S$1,156 psf on land area of about 15,565 sq ft was originally put on the market for S$23 million, he said.
There is a good mix of local and new-citizen buyers. The average age of the buyers is around 45, said Mr Lim. Foreigners are not allowed to buy landed property in Singapore with the exception of Sentosa Cove, subject to government approval.
PERMANENT residents are allowed to buy only landed residential properties which do not exceed 15,000 sq ft in land area, and which are not within a GCB area. There's still a vast choice of super luxurious apartments for the very rich, with no restrictions on citizenship.
At Wallich Residence, there are four penthouses and one super penthouse. The four penthouses are 3,509 sq ft in size and each have four bedrooms.
Last year, James Dyson, the founder of British consumer electronics maker Dyson and his wife Deirdre paid S$73.8 million for a triplex penthouse at Wallich Residence, the most expensive penthouse ever sold. The lofty penthouse is perched on the top three levels of the 64-storey tower. Since September 2019, two more penthouses have been sold (levels 59 and 61), said a GuocoLand spokesman. Therefore, to date, three of four penthouses are already sold.
The most recent penthouse sale was in January 2020 for S$17.5 million or S$4,987 per sq foot (psf), he said.
Launched in 2017, Wallich Residence comprises residential units on the 39th to 64th floors of Guoco Tower, which sits atop Tanjong Pagar MRT station. At 290 metres above sea level, Guoco Tower is Singapore's tallest building.
The price of the final penthouse available at Wallich Residence on level 60 is S$18.6 million, said the spokesman.
DEMAND for swanky new nonlanded condos is said to be resilient and prices are once more rising, with Chinese buyers the keenest among foreigners buying pricey homes in Singapore. Singaporeans make up the majority of buyers accounting for 71 per cent of the core central region (CCR) new home sales in August.
In August 2020, there were 128 new units sold in the CCR, up from 113 units in July; 79 units in June; and 41 units in May.
For new units costing more than S$5 million, 10 were sold in August, the highest since the 16 done in January.
Average prices of new homes in the CCR have been inching up from S$2,510 psf in 1H 2020 to S$2,541 psf in July and then to S$2,616 psf in August 2020, according to Realis data, said Wong Siew Ying, PropNex head of research and content.
But compared with the same period in 2019, CCR average prices are still lower this year. Average prices of new homes in CCR in 1H2019 was S$2,864 psf, S$$2,865 in July and S$$2,909 in August.
Dominic Lee, PropNex head of luxury team, said there is a pick-up in demand from foreign buyers, particularly Chinese buyers.
''Many of the luxury home transactions - costing over S$5 million each - that we have closed recently involved Chinese buyers. Generally, we notice that Chinese buyers tend to prefer central locations within the city, including River Valley, Orchard Road, and the Bugis area.
''The majority of our Chinese clients, at least 80 per cent of them, opted for larger units of 4-room and above,'' he said.
''From our conversations with many of the Chinese buyers, a key reason that's been cited for buying a property here is that they see Singapore as a safe place to park their funds.''