Prices of new properties in the prime central districts have been rising, even as the market dulls. Suburban homes are feeling the strain put on the market by the influx of completed new homes this year.
Buyers seeking out properties in the suburbs tend to be more price-sensitive, and are often hampered by the total debt servicing ratio (TDSR) framework and the additional buyers’ stamp duty (ABSD), leading to higher competition from an expanding pool of stock for a shrinking pool of ready buyers. Prices at The Panorama in Ang Mo Kio have fell 9.7 per cent since its launch to $1,213 psf and similarly in Clementi, units at The Trilinq are now priced around $1,408 psf, almost 9 per cent lower than its launch price.
In comparison, buyers of properties in the prime central districts are more affluent and are able to afford the prices properties here demand. For example at Robin Residences, selling prices are now hovering at $2,371 psf, 2.4 per cent higher than its launch-price. Buyers of centrally located properties also have stronger holding power and less likely to sell unless the price is right.
The price gap between suburban and central district homes have been widening. Last year, CCR (core central region) new-home price premiums were 81 per cent over those in the OCR (outside central region). As more OCR homes hit the secondary market this year, how will smaller investors handle the competition?