THE property auction scene is expected to continue sparkling next year, spurred by interest in the high-end residential market, says Colliers International. It says that the total value of properties sold at auctions may exceed $200 million in 2010, after the figure doubled this year to about $168.4 million from last year’s $83.7 million.
A total of 118 properties were sold at auctions in 2009, again up from last year’s 72.
The residential property was the star performer, accounting for about 52 per cent of total auction sales value.
Contrary to earlier expectations in some quarters, the number of mortgagee properties put on the auction block fell 25 per cent to 195. The figure includes other forced sales, for instance, by the Inland Revenue Authority of Singapore and management corporations.
‘The low number of mortgagee sales could be due to the introduction of the government’s Jobs Credit scheme, which stabilised the employment market. This, in turn, provided some home owners with the ability to service their monthly mortgage loans,’ says Grace Ng, Colliers deputy managing director (agency and business services) and auctioneer.
The number of properties put up for auction by their owners (including trustee sales) rose 10 per cent to 732, further testament to growing acceptance of auctions as a mode of selling property.
Mok Sze Sze, Jones Lang LaSalle head of auctions, says: ‘Owners are attracted by the competitive nature of the auction environment and the high chance of attaining an optimum price for their property.’
She expects to see more owners putting their properties on the auction block next year and, as the economy continues to improve, a further decrease in the number of mortgagee sales.
Colliers highlighted a more than 200 per cent jump in the sales value of residential and industrial properties sold at auction this year to $88.4 million and $20 million respectively. Older residential properties with large areas were popular for both landed and non-landed segments.
The sales value of retail properties transacted at auction rose from $34.6 million last year to $43.4 million.
This year’s auction tally of $168.4 million is about 59 per cent below the peak figures $409.46 million in 1999 and $407.43 million set in 2007.
Back in 1999, when the private residential property market staged a spectacular recovery after the Asian crisis, 27 per cent of 1,210 properties that went under the hammer were sold at auctions, according to Colliers’ analysis. This year, the 118 properties sold made up just 13 per cent of the total 927 properties put on the auction block.
Colliers’ definition of total number of properties put up for auction includes those withdrawn before auction or sold before/after the auction. However, the number sold refers only to those transacted at auction.
Source: Business Times, 18 Dec 2009
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