Kaeden Ong

Property auction sales to hit $70mil: report

Posted by Kaeden Ong on 19th October 2014 in Blog

The total number of properties placed on auction fell by four percent to 119 units in Q3 2014 from the previous quarter, but on an annual basis there was a 1.7 percent increase, said a Knight Frank report.

At the same time, the number of properties offered through mortgagee sale jumped by 16.2 percent to 43 units on a quarterly basis. Of this, there were six landed properties, up from five in Q2 2014.

“The relatively higher total quantum of landed properties, coupled with the implementation of the Total Debt Servicing Ratio (TDSR) framework, has made it increasingly difficult for landed homeowners to service their mortgage payments. This has in turn resulted in an increasing trend of landed properties being put up for auction,” said Sharon Lee, Director & Head of Auctions at Knight Frank Singapore.

Marking its third straight quarterly increase, the number of freehold properties placed under the hammer grew by 6.1 percent quarter-on-quarter to 70 units in Q3 2014. This represents a gain of 14.8 percent from a year ago.

“Due to their tenure, freehold properties are generally more attractive to buyers in the open-market as compared to leasehold properties. Nevertheless, the relatively high asking prices of these freehold properties could have contributed to an increase in the number being put up for auction in recent quarters,” Lee explained.

As for total sales, the number of properties successfully auctioned off rose to 10 during the third quarter from nine in the preceding period. Specifically, five belonged under owner’s sale, translating to a success rate of 6.8 percent as there were 73 properties offered in this segment. Comparatively, only two properties out of 70 were sold in this segment in Q2 2014.

Similarly, the success rate of mortgagee sales increased from 5.4 percent to 9.3 percent in Q3 2014. There were four properties sold out of 43 during the period versus two out of 37 in the preceding quarter.

Furthermore, auction sales soared by 241.2 percent to $31.6 million on a quarterly basis. Of this, the residential sector contributed $20.5 million (65 percent), while shop units accounted for $7.08 million (22 percent).

Moving forward, more properties are expected to be offered via mortgagee sale in H2 2014 given the government’s curbs, such as the tougher mortgage rules. As for the year’s total auction sales, it is forecasted to hit around $70 million.

Credits: Property Guru

Tagged in:
1 Star2 Stars3 Stars4 Stars5 Stars (1 votes, average: 5.00 out of 5)

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>