welcome to

New Launch in Singapore News: En bloc deadlock to continue in 2023

New Launch in Singapore News: En bloc deadlock to continue in 2023.

New Launch in Singapore cooling measures. Many neighborhood shopping malls are likely to go unsold next year, as the disparity in price expectations between buyers and sellers continues. The situation is exacerbated by factors such as high replacement costs for home owners, uncertain macroeconomic conditions for developers.

This year, 12 collective selling points were sold out of a total of 36 points put on the market. According to a compilation conducted by property consulting firm Colliers, transactions made as of December 5 were worth nearly S$2.6 billion. By comparison, S$2.3 billion worth of transactions were made last year.

New Launches in Singapore includes this year's biggest deal - the Chuan Park condominium for S$890 million - as well as the Golden Mile Complex, which is a mixed-use development. The sale of Chuan Park was halted by the Strata Ownership Board on December 9, as a group of six minority owners continued to oppose the transaction.

Analysts and industry experts told The Business Times that the overall rise in property prices has prompted owners to raise the asking price for a collective sale, so they can afford to buy a replacement property.

The result is an "unrealistic" starting price, which is the main reason many inter-block projects fail to find buyers, said Tracy Goh, head of PropNex's collective sales and investments.

Checking out New Launch in Singapore 2022 HERE!!!

GET IN TOUCH WITH US

New Launch in Singapore News: En bloc deadlock to continue in 2023

New Launch in Singapore News: En bloc deadlock to continue in 2023n

Need a good profit

Foreigners and those who own more than one New Launches are also reluctant to sell unless they enjoy a large premium (profit on resale price) from the sale. This is because when they purchase a replacement property, they are subject to an Additional Buyer Stamp Tax (ABSD) of up to 30 percent.

According to Tan Hong Boon, JLL Capital Markets CEO, ABSD will dilute or completely erode the expected semi-collective premium, which is typically between 30 and 50%.

In addition, interest rates have not reached their peak yet. Tang Wei Leng, CEO of Colliers and head of capital markets and investment services, said that with uncertainty about when to complete a collective sale, it is difficult for sellers to accept low prices.

Ultimately, PropNex's Goh expects the latest cooling measure announced on September 30 to be the main obstacle for inter-blockchain projects trying to reach the required 80% consensus in the coming months.

This measure requires homeowners to wait 15 months after selling their own property before they can purchase an apartment resold by the Housing and Development Board. This means that downgraders have to bear the cost of renting in the meantime.

For the above reasons and to entice the necessary number of owners to agree to the sale, many collective sales committees and their marketing agents eventually priced their sites out of the market, Tan said. of JLL said.

Need to factor risks

Meanwhile, developers are facing risks from rising construction and financing costs, government cooling measures and high ABSD fines if they don't sell the project within five years.

Chia Mein Mein, head of capital markets (land and semi-collectives) at Knight, notes: The harmonization of floor area definitions by government agencies – effective June 1, 2023 – will also reduce the marketable area and profit margins for developers' residential projects Frank.

Furthermore, collective sales periods tend to be long. Apartments that do not have 100% of the owner's consent have to go through many different steps to get a sale order. Colliers' Tang said the process could take months to years, depending on the level of opposition from dissident owners. As a result, developers will have to adjust their land bids to reflect the uncertainties and risks involved.

Knight Frank's Chia adds: Recession pressures will definitely affect developer sentiment in 2023. Any unusual Covid variant could lead to a sharp increase in infections. could trigger closures, affect cross-border home purchases, and cause developers to adopt a more cautious wait-and-see approach.

But because developers have low inventory of new apartments, they will need to replenish their land bank. To do so, they will likely turn to Government Land Sale (GLS) sites. These consultants say these provide a shorter and simpler bidding process, as well as greater control over the progress of their projects.

Galven Tan, Savills vice president of operations, investment and capital markets, said GLS will also be the preferred choice for developers in 2023 because of their more affordable prices.

This means they will still be measured on in-block sales. “Many collective selling sites will likely end up operating without a buyer,” said JLL's Tan.

What might succeed

Developers are often interested in small and medium-sized plots in attractive locations – such as near key intersections, said Tricia Song, Head of Southeast Asia Research at CBRE. , prestigious schools and amenities – at actual asking prices.

Savills' Tan said developers are looking at sites that cost around S$250 million to S$300 million and yield no more than 500 apartments. Those near the subway station hold a great advantage.

In addition, well-located sites that come with free land rights — something GLS locations don't offer — will also continue to attract developers, said PropNex's Goh, who expects The collective sale market will be less active in 2023 than this year.

And while there have been no condo transactions in the CBD this year, developers may be attracted to more upscale plots as more foreign high net worth buyers step in. local market, said Knight Frank's Chia.

Indeed, JLL's Tan noted that due to a slower rate of housing price growth in the Central Core Area (CCR) than in the rest of the central region and outside the CBD, developers The developer is looking for high-end locations that will move into the semi-collective market in the main districts. This is especially important, he added, as the CCR is expected to perform better in the new year.

Ultimately, whether sites sell or not depends on whether buyers and sellers find a new price equilibrium, says Colliers' Tang. "And until then, it's probably going to be very difficult to reach any agreement."

Adapted From Business Times

See the newly updated Condo in East Singapore NEWS!!!

New Launch in Singapore | Be First Mover To Secure Showflat Preview

If you really want to own New Launch in Singapore, don't hesitate more time, please Contact Us Now to book VVIP Showflat.

GET IN TOUCH WITH US