Sales of good class bungalows (GCBs) in July continued to dry up after the slowdown witnessed in the first half of this year, according to agents surveyed by The Business Times.
Last month, only one caveat in a GCB area was lodged — a unit at Andrew Road that sold for S$8.88 million (approximately S$780 psf).
However, some market watchers believe that a few more caveats for sales closed in July may be seen over the next few weeks. These include a bungalow at Coronation Road West that was recently sold for S$12.6 million (around S$1,140 psf).
“We’ve seen more viewings for GCBs in July compared with June but these have yet to materialise into sales,” said KH Tan, Managing Director of Newsman Realty.
Property agents said the last large GCB transaction was in June, when a bungalow at Dalvey Road reaped S$34 million (S$1,688 psf). Sold by Teng Ngiek Lian, founder of boutique fund manager Target Asset Management, the property sits on a 20,139 sq ft site.
According to CB Richard Ellis (CBRE), around 17 bungalows in GCB areas were transacted in Q2 2011 for S$396.8 million. While the dollar quantum is 6.3 percent above the S$373.5 million completed in Q1 (which involves 21 transactions), the latest Q2 figure is approximately half the S$777.7 million attained in Q2 2010.
In addition, the first half of 2011 witnessed S$770.3 million of GCB transactions, a decrease of 40 percent from almost S$1.3 billion in the same period last year.
“While every GCB is unique, for a ballpark comparison based on per square foot of land area, the average price of GCBs sold in H1 2011 is S$1,216 psf, an increase of 19.6 percent over the S$1,017 psf for GCB deals in H1 2010,” said Douglas Wong, CBRE Director (Luxury Homes).
He added that the slowdown in GCB transactions in H1 2011 was due to the January 2011 property tightening measures, which introduced the seller’s stamp duty (SSD) rates and lower loan-to-value (LTV) ratios for real estate investors.
Wong believes that the market will move at a comparable rate in the second half, resulting in a possible full-year 2011 tally of approximately 60 to 70 GCBs, which may reap between S$1.4 billion and S$1.5 billion.
“Weaker market sentiment resulting from the debt crises in Europe and the US will overshadow the Singapore property market in the second half of this year,” he explained.
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