Government Land Sales Tender Closing Results for May 2021!
Two government land parcel tenders closed today:
1) Ang Mo Kio Avenue 1 - Private Condominium
2) Tengah Gardens - Executive Condominium
If the huge numbers look confusing to you, maybe it’ll help to scroll to the last image, where it is simplified into price Per Plot Ratio (ppr).
Breakeven prices for a developments these days will easily add at least $600 psf to the PPR price.
Which equates to: 1) AMK Private >$17xx psf to breakeven
2) Tengah EC >$12xx psf to breakeven
If $17xx psf for a private condo and $12xx psf for an EC sounds expensive..
Think about it.. Are developer going through so much trouble and risks just to breakeven?
…Unlikely isn’t it? They aren’t charitable organisations after all.
Therefore, the initial selling prices can easily range from $18xx to $2xxx psf for the AMK condo.
While the EC may see prices $12xx psf to $14xx psf in Tengah Gardens
Very high prices for a yet-to-be developed area.
What does this mean:
1) High property prices are here to stay, especially with so many developers bidding for these two plots of land, showing the acceptance of high land prices.
2) Existing condos and EC developers who failed to get the bid, with remaining units to be sold may likely increase their prices to make up for the lack of new land banks
Would property prices be heading for an upcoming crash in prices?