THE Hungry Ghost Festival did not deter speculative activity in the property market this year, especially in the high-end segment.
In fact, the number of luxury homes changing hands before completion nearly doubled.
A total of 61 such transactions, known as sub-sales, have taken place in the third quarter so far, up from 37 deals in the previous quarter.
The figure is also four times the 14 sub-sales in the third quarter last year, said property consultancy Knight Frank yesterday.
This, despite a longer-than-usual festival this year, during which many Chinese people avoid major activities such as home purchases. But the sub-sale market saw good health in the July-September period, buoyed by the high-end segment, where a high proportion of foreign buyers helped cushion the effects of the Hungry Ghost Festival.
Sub-sales take place when homes that are bought directly from the developer are resold before the development has been completed.
Generally, sub-sale figures are used as a proxy for property speculation as these units tend to be flipped for a quick profit without their original buyers ever occupying the homes.
Preliminary figures show that total sub-sales across all segments rose slightly in the third quarter, said Knight Frank.
There were 139 such transactions in the third quarter so far, up from 131 in the second quarter and 127 in the third quarter last year.
Developments with the highest number of sub-sale caveats were The Sail@Marina Bay, The Imperial off River Valley Road, Icon at Tanjong Pagar, Twin Regency at Tiong Bahru and Oceanfront at Sentosa Cove.
At The Sail, prices of units sold in the sub-sale market have risen about 10.8 per cent in the third quarter so far, said Knight Frank's director of research and consultancy, Mr Nicholas Mak. But he added that the ghost months took their toll on the sales of new homes.
The number of homes that developers sold in the third quarter is likely to fall to about 2,000 units, 20 per cent below the previous quarter.
This was probably due to lower demand from buyers in the mid-tier and mass market segments, as developers' sales in the high-end market actually climbed by about 20 per cent over the previous three months, said Mr Mak.
Knight Frank also said that in line with the current craze for luxury homes, the average prices for such homes have risen by between 2 and 6 per cent in the third quarter, while rentals have risen by between 1 and 5 per cent.
Foreigners, who account for a significant proportion of demand for high-end properties, also bought more homes that cost at least $5 million.
