What’s up on the condo market

Range to choose from but projects skewed towards high-end sector; overall home prices expected to rise at steady pace of 8% to 10%

Mass market and mid-tier housing launches had dominated the market last year while developers held off launching their posh projects.

But the scene is set to reverse this year, with high-end project launches taking centrestage.

These are projects located in districts 9, 10 and 11 as well as in Sentosa Cove and Marina Bay. Quite a few are around the Orchard Road area such as Ardmore Park, Emerald Hill Road and Handy Road.

In the Cairnhill area, new launches will include the 229-unit The Laurels and the 64-unit Urban Resort Condo.

Projects coming up for launch in another posh residential area, Sentosa Cove, include the 228-unit branded condo in Sentosa Quayside and the 151-unit Seascape.

High-end projects are already starting to stream into the market.

Savills Singapore said it launched the 20-unit 42 Stevens yesterday at an average price of $1,900 per sq ft (psf), and plans to start selling 8 Nassim Hill at $3,100 psf on average on Tuesday via a preview by appointment.

Some of the projects that CBRE is marketing in the first quarter of this year include Cube 8 along Thomson Road, Holland Residences, The Holland Collection, Emerald Hill Residences and Cheung Kong Holdings’ project along West Coast Crescent, said its executive director, residential, Mr Joseph Tan.

Still, upgraders need not fret as there is still a list of mass to mid-tier projects available.

This year, new launches could be between 7,000 and 9,000 units, down from 14,725 last year, said Colliers International’s director of research and advisory, Ms Tay Huey Ying.

‘In terms of projects, it will be highly skewed to the high-end sector.’

But in terms of units, there are still a fair number available in suburban or city fringe areas, she said.

Developers who bought government land sales sites last year are expected to launch their projects on these non-city sites this year.

These are in Chestnut Avenue, Dakota Crescent and Serangoon Avenue 3.

City Developments and Hong Leong Group plan to launch the condo in Chestnut Avenue, a joint development, within the first half of the year.

Ms Tay estimates a minimum selling price of $670 psf to $700 psf for the Chestnut Avenue site, and roughly $1,000 psf to $1,100 psf for the other two sites in Dakota Crescent and Serangoon Ave 3, which could be launched in the second half of the year.

‘Actual selling prices depend on market conditions,’ she said.

‘But because the developers had bought these three land parcels at or near benchmark prices for the areas they are in, they should be selling the developed units at these levels, at the minimum.’

Said CBRE’s Mr Tan: ‘The bar is set to be raised in terms of pricing this year. Possibly fewer than five projects might be priced below $1,000 psf.’

Most of the projects in the city centre or what the Government calls the Core Central Region are expected to be priced between $1,600 psf and $2,500 psf, he added.

At the annual construction and property prospects seminar last week, CBRE Research said it expects residential prices to increase in a ’steady fashion’ this year.

Overall home prices, it predicted, could rise by 8 per cent to 10 per cent this year.

Source: Sunday Times, 17 Jan 2010