Two apartments at Turquoise, a luxury condominium in Sentosa Cove, have entered the market at low prices that could result in losses of nearly $3 million each, according to media reports.
Reportedly held by the same owner, the units are up for sale for about $4.5 million to $4.6 million each or $1,600 psf. But both 2,777 sq ft condos were purchased in November 2007 for about $2,600 psf, while prevailing prices are within $2,000 psf to $2,200 psf.
This means the owner could suffer losses of around $2.7 million for each apartment.
Nevertheless, the estimated losses are still less than those recorded by two similarly-sized condos sold earlier at the 91-unit Turquoise.
In July, two apartments were auctioned off for around $1,400 psf via mortgagee sales. But because these units were bought for about $2,550 in 2009, the losses reached up to $3.2 million.
Knight Frank Singapore’s Executive Director of Residential Services Tan Tee Khoon revealed defaulting borrowers are struggling to offload their high-end properties amidst the sluggish secondary market. It is also harder to lease them due to the larger supply of new houses in the prime districts.
“Sentosa’s exclusive location makes it less accessible than homes on the main island and harder to lease now,” he added.
Notably, properties are placed under the hammer when banks attempt to recover the amount they loaned after a borrower defaults on his mortgage. Experts pointed out that luxury homes are more likely to be repossessed by financial institutions due to the large amount of borrowed cash and a high possibility that the buyer might be a speculator.
Image source: Ho Bee Land’s website
Muneerah Bee, Senior Journalist at PropertyGuru, edited this story. To contact her about this or other stories email muneerah@propertyguru.com.sg
