Some Executive Condominium (EC) developers have seen higher sales despite the
government introducing a package of cooling measures on January 12.
EC
projects like
One Canberra and
Watercolours, which were launched last year, have
seen sales jumped by about five times after the measures kicked in.
In
the two weekends after the new measures kicked in,
One Canberra sold 30 units,
up from two to three units per week before the announcement.
Over 60% have been sold after it was launched for sale in June 2012.
Mr Ken
Yeo and his wife spent two months hunting for a new home and they finally bought
one after the government introduced the seventh round of cooling measures last
month.
The couple bought a 3-room dual-key executive condominium at
One
Canberra at Yishun for $813,000.
They intend to have their
parent-in-laws move in with them when the new home is ready.
Mr Yeo said:
"Talking about the price is one thing. It might be going up in the near future
and there might be more cooling measures coming out. They were the two main
concerns."
ECs hogged the headlines when a luxurious penthouse unit was
sold for over $2 million last year.
It prompted the government to
introduce a few measures targeting the segment to make sure that ECs do not
stray from its objective of providing alternative housing for the sandwiched
class.
Under the new rules, the maximum size of an EC unit must be no
larger than 160 square metres. Some developers said this will encourage the
industry to review how units are being laid out and improve space
planning.
For instance, Global Property Strategic Alliance, which is
jointly developing
Watercolours EC at Pasir Ris, said it is looking at rolling
out a new type of unit - a maisonette - in its next EC
project.
Watercolours is developed by Huge Development, a joint venture
between Ho Lee Group, UE E&C, GPS Alliance Development & Investment and
EVIA Real Estate.
Jeffery Hong, chief executive officer of Global
Property Strategic Alliance, said: "Typically in the 2-storey penthouses, if you
look at the second floor, it is basically the master bedroom and the roof
terraces. This is unlike the maisonette whereby your first level will be your
living and dining area, and the second floor will be all your bedrooms instead
of terraces."
Watercolours have also sold 20 units in the last two
weekends. This is more than five times from before the cooling measures were
implemented.
Watercolours was launched mid last year and over 70%
of units here have been sold so far.
Under another new measure,
developers will only be allowed to launch units for sale 15 months from the date
of award of the EC sites.
Industry players said this will weed out weaker
developers.
Richard Nah, senior manager at MCC Land Singapore, said:
"The immediate income for new development upon launch is the five per cent
booking fee. And when they exercise the sales and purchase agreement, it will be
another 15%. This is about 20% of the sales price.
"This
will go a long way into mitigating some of the cost (construction, marketing,
building and running of the showflat) that the developer will have to shoulder.
If the developer were to lose this avenue where they can get the funds from,
they would either need to have strong financial backing or finance this through
the banks. This will further add to the cost of the
development."
Analysts expect seven new EC projects to be launched for
sale this year from sites awarded in 2012.
Assuming all the projects are
fully sold, analysts said there won't be any new EC units in the market in the
first half of next year as a result of the 15-month restriction on sites sold
after January 12.
They added that ECs will continue to be popular among
home buyers and they expect prices to remain stable this year.
Source: Channel News Asia
