Despite the pick up in activity within the residential en bloc market, with four collective transactions done so far from last year’s three, property experts believe conditions will not return to the peak of 2007, when immigration and global economic growth fuelled the hike in real estate prices, reported Today Online.
According to them, the property market was “relatively quiet” during the last three to four years, making them a low base of comparison.
And although the number of units sold via collective sales during the first half of 2017 were the highest since 2011, they are still less than half than what was transacted then.
Data compiled by Cushman and Wakefield Singapore research head Christine Li showed that 650 en bloc units were sold at a total value of S$1.521 billion in January to June, up from the 582 units sold at a total value of S$1.158 billion for the whole of last year.
Meanwhile, only 1,402 en bloc units were sold at S$3.479 billion from 2012 to 2016, while 12,710 en bloc units were sold at S$22.3 billion from 2005 to 2007, said Li.
PropNex Realty CEO Mohamed Ismail is not surprised by the renewal of interest considering the hike in sales for newly-launched projects.
He noted that the upward trend is expected to continue in 2018 as there is some price stabilisation within the market and the developers are relatively upbeat.
However, JLL Singapore regional director of capital markets Tan Hong Boon revealed that while between 30 and 40 residential properties across Singapore are gearing up for collective sale, most of them may not come to the market given that the collective sale process, which often involve a legal process, can take “years” to complete.
“There is a strict process for en-bloc sales, and developers would prefer government land sales, which are more direct,” he said.
Notably, the state is expected to ramp up government land sales on the back of the increased demand for land sites, said Ismail.
This article was edited by Denise Djong.
