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One might think that the well-off are immune to poor investment decisions.  Really?  Interesting enough, about 2 out of every 5 Sentosa condominium units resold within the past year had been transacted at a loss.

HSR Research revealed that resale prices in Sentosa had fallen from about $2,400 psf over the Jan-May 2013 period to about $1,800 psf in the first five months of this year.

Two units in particular made pretty hefty losses.  A 2,982 sq ft unit at The Oceanfront sold for $5.65 million ($1,895 psf) on 26 Nov last year, after it was purchased in Apr 2008 for $7.2 million ($2,415 psf) – a $1.55 million loss. Ouch.

Another one at The Coast sold for $4.8 million ($1,702 psf) in 6 Dec 2013, after it was purchased at $6 million ($2,128 psf), registering a $1.2 million loss over 2 years.

More recently, a unit at The Berth was sold at a loss of $315,000 on 10 Apr 2014.  Nobody likes to sell his property at a loss.  The owner must have been driven to a tight corner before having to resort to selling in a weak market.

More Sentosa properties are also being put on the mortgagee auction block.  Recently, a 2,777-sq-ft unit at Turquoise condo, put up as a mortgagee sale by a lender at a Colliers’ auction received no interest despite shaving $1 million off its previous opening price of $5 million.

It’s important to get your timing, financing and strategies right in property investment.  Losing money is very real.

When Douglas gets his RES license in a couple of weeks, he will be able to represent folks in property transactions.  This was not the intention when he founded Empower Advisory.  But witnessing people get hurt and misled into less than ideal property investments and decisions made him decide that it’s the right thing to do, so less folks will make bad property decisions.

Very soon, as a seller or buyer of property, you can engage Douglas to represent you in property transactions and provide you with the advice you deserve.

Stay tuned!

Our Best, Always

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Prices of property projects in general are on their way down.  The question on everyone’s mind now, is how much more?

Wheelock Properties managed to offload another 95 units of The Panorama, a 99 yrs LH mid-tier condo in Ang Mo Kio after slashing prices by about 12%.  The project is not even half sold since its launch 6 months ago, so the developer is not exactly celebrating yet.

City Developments fared better, managing to move 63% of 944 units at Coco Palms in Pasir Ris since its launch on 17^th May 2014. Three-bedders start from $880,000 and four-bedders start from $1.21 million, at an average $980 psf, below the “magical” $1000 psf floor.  The lower quantum, made securing a loan easier.  No prize for guessing that all one bedroom apartments have been sold.

Developers are adjusting to the new reality and pricing their projects to sell.  We sense that the cooling measures will not be lifted for some time yet.  This is even though Monetary Authority of Singapore managing director Ravi Menon had recently said that property measures may not be permanent and will only be used from time to time,

Runaway property prices was a huge grouse in the 2011 election and nearing the next coming election in late 2015 or 2016, it is unlikely that the authorities would want 3 years of cooling measures come undone so soon.  The aim is to gradually bring property prices to a more sensible level the government has done a great job in this respect.

More affordable property will also be beneficial to businesses who have complained about the squeeze they face from unreasonable rental and property prices. This further reinforces, in our view, the authorities’ reluctance to remove cooling measures so soon.

So will you celebrate Christmas early? Or wait a while more?

Our Best, Always

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