Property agents tap buyers' FOMO, claim price hikes at slew of condo, EC projects
REAL estate salespersons in Singapore have been riding on Pasir Ris 8's wave this week to advertise increased prices of units at multiple private residential projects, mostly situated in the suburbs and city fringe.
In social media posts and WhatsApp messages seen by The Business Times (BT), agents are urging buyers to snap up units before developers move on their apparent plans to raise prices by about 1 to 5 per cent.
But some industry watchers have advised restraint, warning that any resultant "fear of missing out" (FOMO) among purchasers could easily create froth in the market and potentially even trigger the need for fresh cooling measures.
Moreover, a few of the developers are simply stopping their early-bird discounts without imposing outright price hikes; where there have been increases, they are not necessarily significant.
BT has reached out to developers to verify the information.
Projects that have already implemented higher prices as at Friday, say the agents, include the following, with increases said to be within the 1 to 4 per cent range:
- Normanton Park
- Ki Residences
- Midwood Condo
- The Florence Residences
- Penrose
- The Antares
- Coastline Residences
BT understands that earlier this month, Kingsford Huray Development raised prices at Normanton Park by 2 per cent plus an additional S$5,000 for the two-bedroom units, and by S$5,000 for the rest of the units. The S$5,000 sum works out to about 0.2 to 0.5 per cent of the previous prices.
This weekend and next Monday, a string of other residential developments are expected to get more expensive. Property agents say these include:
- Verdale
- Meyer Mansion
- Sengkang Grand Residences
- Kent Ridge Hill Residences
- Mayfair Collections
- Riverfront Residences
- Affinity at Serangoon
- Kopar At Newton
- Fourth Avenue Residences
- Turquoise
- Provence Residence
- Parc Clematis
- Treasure at Tampines
- One Pearl Bank
- Clavon
An agent said "units flew off the shelves" at Clavon, but a spokesperson for the developer UOL told BT on Friday: "We are not increasing the price of Clavon at this moment. However, we are looking to review the commission fee of the agents."
And later in August, more projects seem likely to jump on the bandwagon:
- Forett at Bukit Timah
- Stirling Residences
- Parkwood Residences
- Parc Komo
- OLA
One of OLA's developers, Evia Real Estate, plans to review the pricing of the units at the executive condominium (EC) after Aug 9, "in line with ongoing market sentiments and equitable operation cost increase", it said in response to BT's queries. Evia added that as OLA is an EC project, it "will have to keep in view both the mortgage servicing ratio and household income restrictions as the integral considerations of our price revision exercise, if any".
Some agents' messages and posts implied urgency and suggested that buyers stop waiting for private home prices to fall, citing rising land bids and the newly launched Pasir Ris 8 as the bellwether, given its multiple price revisions.
One wrote: "Developers will only continue to increase prices." Another said she believes more projects will implement price hikes.
Other agents have said: "If you are waiting on the fence, wait no more and take action now!" and "Grab your dream unit and enjoy the instant capital gains".
Nicholas Mak, ERA Realty Network's head of research and consultancy, told BT that he found some of the circulating messages containing details of upcoming price increases "incredible".
"They are adding to the FOMO among buyers. Homebuyers need to keep a cool and level-headed approach, as purchasing a home is a long-term commitment," he said.
Huttons Asia chief executive officer (CEO) Mark Yip noted that some of the price increases taking place now are "normal", as they are for projects that are either at the tail end of their sales phases or have reached certain milestones, such as the units being 50 per cent or 90 per cent sold.
He described the increases that are averaging 1 to 2 per cent as "mild" and "well within the price gains seen so far in H1 2021".
PropNex CEO Ismail Gafoor noted that developers who had priced their suburban or city-fringe projects "sensitively" and sold at least half the units are now eyeing 1 to 5 per cent price hikes "on the back of homebuyer demand".
However, he thinks that the chances of a "mass panic buying" will be low despite the potential price hikes. "Current measures such as the total debt servicing ratio and additional buyer's stamp duty are adequate to rein in buying sentiments. We believe buyers who enter the market will do so sensibly, with a mid- to long-term view and investment horizon," he told BT.
The price adjustments at Pasir Ris 8, by Allgreen Properties and Kerry Properties, could raise expectations for suburban condo pricing, analysts have said.
At Pasir Ris 8, 415 units were sold last weekend for an average of nearly S$1,600 per square foot (psf). The unit prices ranged from S$1,400 psf to S$2,000 psf.
One agent suggested in a Facebook post that S$2,000 psf would be the "new norm" for projects in the outside central region.
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