Semi-detached unit sees fierce bidding in year's first property auction

Singapore

A SEMI-DETACHED house in the Siglap area attracted an unusually high number of bids - 33 - at the year's first public property auction on Wednesday, an event that also stood out for its high number of mortgagee listings.

The five-bedroom, 21/2-storey house along Aida Street in District 15 had a guide price of S$3.4 million.

Bidding opened at S$3.25 million, with the proceedings pushing the price up until the bank-sale property was sold for S$3.89 million.

The previous transaction for the house, which has land area of 2,896 sq ft and built-up area of 3,872 sq ft, was S$1.5 million in 2002.

Joy Tan, Edmund Tie's head of auction and sale, was pleased with the number of bids, which she described as the largest that she has seen in a while.

In auctions last year, the highest number of bids received for a property was over 20, she noted.

Those offers had come in for a freehold semi-detached house in Lorong Ah Soo in District 19. The six-bedroom property - with a land area of 5,144 sq ft and built-up area of 8,826 sq ft - had a starting bid of S$5 million and was sold for S$5.5 million.

"It's abnormal to have more than 30 people chasing for a property," said Ms Tan, who suggested that it could be because freehold semi-detached homes of this size are seldom available.

The Aida Street house was the only one sold during the afternoon. It was among 16 listings to go on the block - among which 14 were mortgagee sales; the remaining two properties were owner sales.

Ms Tan said the high proportion of mortgagee sales could be a sign of Covid-driven stress. She noted that in typical auctions, such sales would perhaps make up half the listings.

Banks held off on repossessing properties last year amid the pandemic, and also because government relief measures were being given out, she said.

It was full house at the auction on Wednesday, with 50 people present and another 33 signed on in Zoom.

Ms Tan said that at this auction, potential buyers were on the hunt for a good buy, and were unwilling to at least match the reserve prices.

Aside from the Aida Street property that was sold, the other listings were withdrawn when offers came in at below their reserve prices, she said.

Ms Tan said it is not unusual for auctions to end without any property being sold because of potential buyers' "bargain-buy" mindset. She added that buyers may have been influenced by this week's news that the government is monitoring the movement of the property market, and stands ready to adjust policies to maintain a stable, sustainable property market for Singaporeans.

Following the auction, many of the listings are now under private-treaty negotiation she said.

This means the auctioneer will gather the price offers to show the banks and take their instructions. There may yet be another auction held for these properties.

Banks have to be accountable and show that they have tried to get the best price at auctions. Prices will slide when mortgagee-sale properties are listed repeatedly.

One mortgagee listing, a 6,042 sq ft, freehold "remnant land" in Sixth Avenue tagged with a guide price of S$3 million, had pulled in more than 100 enquiries pre-auction.

But the offers at the auction for this plot, which is surrounded by state land, were too low, so the listing was withdrawn, but there was "a lot of haggling", said Ms Tan.

"Remnant land" refers to small and /or irregularly shaped plots left over after development. They are regarded as unsuitable for independent development by virtue of their size and shape, but have the potential to enhance the economic value and use of adjoining land.