The proportion of vacant Executive Condominiums (ECs) in Singapore climbed to 16.2 percent in Q3 2014, or its highest level in over five years, reported the media.
Experts attribute the spike in empty units to the influx of new units as well as the cooling demand for resale HDB flats.
Notably, the 2,375 vacant units mostly came from newer projects.
Since Q3 2013, eight new ECs with almost 4,200 units received their Temporary Occupation Permits (TOP), which translate to a 40 percent increase in supply, said JLL’s National Director of Research Ong Teck Hui. The projects are Blossom Residences, Arc at Tampines, Belysa, Austville Residences (pictured), The Canopy, RiverParc Residence, the Prive and Esparina Residences.
Meanwhile, experts note HDB upgraders to ECs are now taking three to five months to find buyers for their flats, an increase from one or two months previously.
Transactions in the HDB resale market also declined to 18,100 in 2013 from 2012’s 25,094.
Chris Koh, Director of Chris International, expects this year’s number to stand at around 17,000, with HDB resale prices bottoming out in mid-2015.
PropNex CEO Mohamed Ismail Gafoor revealed EC upgraders accounted for 10 to 15 percent of last year’s HDB transactions. He believes two thirds of the 3,585 EC units sold in 2013 were snapped by upgraders, while the rest were bought by first-timers.
EC buyers may feel more pressured to sell their homes considering the number of EC completions is expected to stand at 2,845 next year, 6,371 in 2016, and 2,505 in 2017, said Century 21 Singapore CEO Ku Swee Yong, adding that EC vacancy rates will likely increase too.
Alice Tan, Research Head at Knight Frank Singapore, said another source of pressure may come from the increased supply of completed Build-To-Order (BTO) flats and private homes available for sale.
Muneerah Bee, Senior Journalist at PropertyGuru, edited this story. To contact her about this or other stories email muneerah@propertyguru.com.sg
