Resale market coming alive again!

More homebuyers are returning to the private residential resale market as it is seen to offer better value compared to new projects launched by developers.

In fact, the gap in median prices of new and resale transactions has also narrowed.

That's according to real estate agency Dennis Wee Group (DWG).

In a report, DWG said the caveats lodged in the secondary market climbed about 33% in the second quarter in 2012, against the previous quarter.

In particular, the central region saw the largest increase in resale transactions at 37.4%, followed by the North Region at 32.7% and the West Region at 30.9%.

Citing examples, DWG said the record selling prices for new 99-year leasehold projects in Bishan and West Coast are comparable to freehold non-landed residential developments in the resale market, such as Twin Regency and The Regency in Tiong Bahru.

The real estate agency said the revival in interest in the resale market has boosted prices of private homes in the second quarter.

DWG's report showed that the gap in median prices of new and resale transactions has narrowed from 17% in 1Q 2012 to 13% in 2Q 2012.

The median prices of private residential units in the resale market rose 4.6% to $1,026psf in 2Q 2012 from $981psf in 1Q 2012.

Meanwhile, the median prices of new projects on an islandwide basis were flat in 2Q 2012 at $1,160psf.

DWG also notes that the median size of units sold in the new sale market rose to 947sqft in 2Q 2012 from 807sqft in 1Q 2012 as a result of lower sales of small units.

It said this is probably due to recent comments by the government that they are monitoring the shoebox apartment segment which could have put off buyers from purchasing small format homes.

DWG said the number of transactions by foreigners rose in 2Q 2012 as the buyers have accepted the Additional Buyer's Stamp Duty as a tax and are selectively picking up properties in Singapore.

445 private residential units were sold to foreigners in 2Q, up 26.8% on-quarter.

Moving forward, DWG said developers are likely to launch more projects before the lunar seventh month which runs from August 17 to September 15.

Source: Channel News Asia

Some may say that we're "马后炮", but the wife and I have always felt that there are untapped potential in the secondary market and have advised the same to whoever that's willing to listen. And despite the supposed narrowing gap between prices in the primary (new) and secondary markets, we still believe that there are hidden "gems" in the later if one bothers to look hard enough...

For those who wish to know the origin of the Chinese phrase "马后炮" and what it means:
http://blog.csoftintl.com/ma-hou-pao/

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