Sunday, April 09, 2006

Unsold units in completed condos worth checking out

Many are being offered at discounts of up to 20%, along with guaranteed tenants
By Fiona Chan
 
WITH housing prices starting to inch up, home buyers looking for more affordable property might want to turn their attention to completed projects that still have unsold units.
 
Developers have been cutting the prices of these units - some of which have sat unsold for almost 10 years - in an attempt to offload them as soon as possible.
Many of these condominiums are now going at a discount of as much as 20 per cent from their original sales price when they were first released for sale.
 
Centrepoint Properties' Yishun Sapphire, for instance, is now priced at about $420 per sq ft, down from about $520 psf when it was launched in 2000. Slightly more than 300 units in the 380-unit development have been sold over the past five years.
 
Over in the east, Bonvests Holdings relaunched its 189-unit The Trumps at Kemban- gan late last year at $550 psf, compared with $640 psf during its launch in May 2001.
The Straits Times understands that about 30 per cent of the units at The Trumps are still available for sale.
 
Apart from offering price discounts, some developers are adopting more creative marketing strategies in a bid to attract hesitant buyers.
Those who purchase units with the intention of renting them out are being offered guaranteed leasing schemes, in which developers commit to providing a tenant and a specific rental yield.
 
The Trumps and Cheung Kong's Cairnhill Crest are two projects that recently relaunched unsold units with such schemes.
 
At The Trumps, investment buyers are guaranteed a 5 per cent rental yield per year, while Cairnhill Crest buyers who choose to take up the rental scheme can get an average yield of 4.2 per cent annually.
 
However, some developments are now taking advantage of a recovering market to maintain prices at their launch levels.
 
Allgreen Properties' Kerrisdale at Serangoon, which was released for sale last year, has kept prices at about $480 psf despite having more than 100 units still unsold.
However, these units might still attract home buyers who urgently need to move into a new home and cannot afford to wait years for a development to be completed, which is often the case for newly launched projects.
 
For the most part, property consultants said that developers are keen to sell off these unsold units as soon as possible because most of them are 99-year leasehold properties that have already been completed.
 
'Particularly for leasehold properties, the developers would not want to wait too long as the tenure clock is ticking and design obsolescence will also set in,' said Dr Chua Yang Liang, the head of Singapore research at property consultancy Jones Lang LaSalle.
 
'The longer the unit is kept out of the market, the less appealing it becomes.'

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// posted by Shajahan @ 11:54 AM


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