270 units sold at Ripple Bay condo

Property developer MCL Land has seen strong interest for itsRipple Bay condo (pictured) in Pasir Ris, with 270 units sold at the 679-unit project as of 8pm yesterday.


According to a Business Times report, buyers were mostly Singaporeans with a good spread of one- to three-room units snapped up.


Koh Teck Chuan, Chief Executive of MCL Land, said that when sales started in the morning, the average price was approximately S$855 psf. However, when the day progressed and strong interest was seen, the developer decided to increase prices to an average of S$870 psf. 


“But we have not done a final tally on our average price,” said Koh.


Located within walking distance to Pasir Ris Beach, Ripple Bay condo is in front of Far East Organization'sSeastrand development, where units are being offered at S$905 psf on average. Far East launched the 473-unit project in June 2011 and around 100 units are still available.  
 
“There's no plan to lower the price and there isn't any special promotion for Seastrand. However, buyers receive a reimbursement for the standard three percent buyer's stamp duty and a furniture voucher equivalent to two percent of the sale price, as is the case for other Far East projects as well,” said the developer. 


Meanwhile, 58 of 120 units released at Frasers Centrepoint’s 429-unit Palm Isles condo have been sold thus far. The average selling price for each unit is S$830 psf, lower than the S$870 psf average price of the nearby 501-unit Hedges Park Condominium, which was launched in April 2011 and still has more than 100 units available. 


“We currently have no change in plans with respect to pricing and additional incentives at Hedges Park. But we will continue to monitor market trends there,” said a spokesman for Tripartite Developers, the firm behind the project.

Sky Habitat the priciest suburban condo?

A new condo in Bishan that’s slated to launch in mid-April, could be the priciest suburban condo to hit the market, according to a report by The Straits Times.

The article said that the indicative average price of Sky Habitat (pictured) at Bishan Street 14 is expected to range between S$1,700 psf and S$1,800 psf. However, this is only the preliminary estimate from marketing agents, and could be higher or lower depending on buyers’ interest.

Despite the early indicative price, the report said that the development will set a benchmark for the Bishan Central area as well as for suburban projects across the island. The price range for the condo is well above the initial market expectation of around S$1,500 psf.

Tan Kok Keong, Research and Consultancy Head at OrangeTee, said the project’s proximity to Bishan MRT interchange as well as to Junction 8 mall and good schools like Raffles Institution are major selling points.

Another key feature of the project is its design by renowned Israeli architect Moshe Safdie, who also designed the Marina Bay Sands integrated resort.

However, one industry player said it would be a tough for the 99-year leasehold project to hit a price tag of between S$1,700 psf and S$1,800 psf, noting that CapitaLand’s d'Leedon project on the former Farrer Court site is going for approximately S$1,680 psf. That project was designed by the famous architect Zaha Hadid.

Located in District 20, the iconic 38-storey condominium project is being developed by Bishan Residential Development, a joint venture (JV) company between CapitaLand and Mitsubishi Estate. It comprises 509 units ranging from two- to four-bedroom homes as well as one-bedroom plus study and two-bedroom plus study units.

Slew of new projects launching this week

Following record home sales in February, developers will be rolling out several housing projects into the market this week, amid fears over further cooling measures by the government.

The slew of new projects include the Natura project (pictured) from Macly Group and Roxy-Pacific Holdings, MCL’s Ripple Bay condo, Frasers Centrepoint’s Palm Isles development at Flora Drive and Far East Organization’s 416-unit Hillsta project at Choa Chu Kang Road.

Except for Natura, all the other projects are 99-year-leasehold.

The 10-storey Natura is located at Hillview Terrace and will likely be priced at an average of S$1,250 psf. Comprising one- to three-bedroom units and penthouses, the project is offering smaller-than-usual three-bedroom units, as small as 635 sq ft.

Ripple Bay offers apartment units close to Pasir Ris Beach with an average selling price of slightly over S$850 psf. It comprises 679 units spread across four 12-storey blocks and three 13-storey blocks, with one-bedders and two-bedders comprising 18 percent and 42 percent of the units respectively. The one-bedder 484 sq ft units are priced from S$415,130 (S$858 psf) while 990 sq ft three-bedders start from S$795,500 (S$805 psf).

Units at Palm Isles will be offered at an average price of between S$850 psf and S$880 psf. Featuring 429 residences; the project includes a low-rise block with 28 garden homes inclusive of individual private carpark lots and gardens.

Peter Ow, Managing Director at SLP International, noted that developers are launching projects soonest to prevent the effects of possible cooling measures from the government, as a result of strong private homes sales in the primary market last month.  

“To ensure a good take-up rate, developers are likely to price new mass market condo launches say about S$10 to S$15 psf below existing nearby projects,” said Ow.

Slowdown seen in resale property market

Property developers and agents are venturing into other avenues of business, as the once booming resale market for private and public housing has been affected by the government’s tightening measures.

According to estimates, the number of resale transactions in both markets dropped significantly in the first quarter compared to last year. However, the slowdown has spurred activity in other segments, with sales of mass-market condos rising. Home buyers snapped up 3,138 new private homes last month, including executive condominiums (ECs).

To get a piece of the action, property agencies such as ERA and PropNex are looking for direct deals with developers to market new launches.

Agents are also tapping on opportunities in the commercial and industrial sector, with many looking to sell such properties to boost sales. Some have also engaged in subletting HDB units to those who would rather rent than buy, which comprises mostly of foreigners.

Latest data from ERA and OrangeTee show that the number of HDB resale transactions hit between 4,000 and 4,500 between the January to mid-March period. This was nearly 30 percent lower than the 6,228 deals seen in the first quarter of 2011 and 24 percent below than the 5,921 transactions recorded in Q4 2011.

Tan Kok Keong, Research and Consultancy Head at OrangeTee, said the large number of new units and recent moves to allocate a larger number of flats for second-timers have reduced demand in the resale market. This has led to the cash-over-valuation (COV), which is the cash premium paid above a unit’s valuation, to also drop.

Mohamed Ismail, CEO of PropNex, also said that most buyers opt to purchase new flats because they only need to fork out the initial downpayment, which is 20 percent of the purchase price.

A two-tier private housing market?

The prime and mass-market private housing segments in Singapore are facing starkly different fortunes.

According to recent industry data, while the mass-market segment is still enjoying healthy demand and price increases, the prime segment seems to be suffering from waning demand as foreign investors exit the Singapore residential property market.

Take the January and February sales figures as a case in point. Prime property accounted for only 1 to 2 per cent of total developer sales, while foreign buyers made up only 4 to 6 per cent of the caveats lodged during the first two months of this year. We believe the additional buyer’s stamp duty imposed last December is one of the main reasons foreign investor interest in the Singapore residential market has shrunk significantly, thus resulting in the weak demand for the prime housing units in which they traditionally invest.

This development leads us to ask: Will we see a decoupling of the two segments, resulting in a two-tier private housing market in Singapore? Will mass-market prices continue to trend up, while prime prices weaken due to a lack of foreign demand?

While a decoupling of the different segments of the Singapore housing market is rare, it did happen for a certain period during the last global financial crisis. From early 2008 to mid-2009, private residential prices fell significantly across the board – by an average of 25 per cent – while HDB resale flat prices trended slightly higher. However, we believe this decoupling and the strength of HDB prices were driven mainly by a shortage of supply, as the actual completion of HDB flats plunged from around 28,000 units in 2000 to only around 2,000 units in 2008.

Now, looking at the supply conditions in the mass-market private residential segment, we estimate that around 3,000 units were completed last year. We expect this to increase to around 4,000 units this year and 7,000 units in 2013.

The popularity of these properties, especially the so-called shoebox units, which really took off in late 2009 and early 2010, had resulted in the subsequent launch of a significant number of mass-market private residential projects. Factoring in a three-year construction period, some of these projects should be completed by late 2012 and significantly more in 2013.

In addition, looking at the Government Land Sales programme in the second half of 2011 and as planned in the first half of this year, the bulk of the land sales – an estimated 75 per cent by the number of units – is in the mass-market segment. This would ensure that the supply of mass-market private residential units would remain ample from 2014 onwards.

Taking these two factors into account – the narrowing price premium between prime and mass-market properties over the last two years, and the outlook for ample mass-market supply starting next year – we believe any decoupling of the two segments will be short-lived. This means that while mass-market private residential demand and prices are currently still doing well, any potential further weakness in the prime segment could eventually spread to the mass market.

» Building boom in Geylang

MENTION Geylang and many think of the red-light district, but the area is in the middle of a building boom, with developers banking on its proximity to the centre of town.

About 1,900 private homes across more than 25 developments will be completed over the next three to four years, and many will be shoebox flats, an increasingly popular choice for Singaporeans, investors and expatriates.

The challenge, as some agents note, is Geylang's seedy reputation.

Occupancy will be tested soon enough when many of the flats, in particular the shoebox units, hit the market.

These are homes ranging from less than 400 sq ft to 600 sq ft, and Geylang will be awash with them.

Centra Studios, a 51-unit condominium in Lorong 25 by Pinnacle Realty, has 40 one-bedroom apartments ranging from 344 sq ft to 527 sq ft, while the 39-unit Prime Residence in Lorong 22 by Springlife Development has 12 one-bedders ranging from 398 sq ft to 409 sq ft, and 20 one-plus-one units from 527 sq ft to 538 sq ft.

Property agents told The Straits Times they are confident that these tiny flats will remain popular because of the location, and they pointed to the high rents as evidence.

One housing agent said: 'Location-wise, going to the CBD (Central Business District) is five to seven minutes' drive. With the upcoming Paya Lebar commercial hub, this whole Geylang, Kallang area will be between the CBD and the hub.'

The rents, which are already 'the highest in the Aljunied area', will either stay at the same level or go even higher in the next few years.

The agent estimated that a one- or two-bedder shoebox unit in Geylang can be rented for about $2,500 to $3,000 a month, with 'rental returns going very high at 6 per cent to 7 per cent because of the location'.

He believes most tenants will be expatriates or childless couples.

Mr William Choo, a senior marketing consultant at Huttons Asia, said monthly rents are 'about $3,000 plus' for Geylang shoebox units.

While he tips an oversupply of such units - 'it's not possible to anticipate demand' - he added that there will eventually be tenants to occupy all the homes. He said: 'Once the pricing is right, someone will take up the place.'

A check with the Urban Redevelopment Authority's online system revealed that from last November to January this year, median rents for Lorongs 26, 28, 30 and 34 ranged from $2.90 per sq ft (psf) to $3.33 psf. For a 500 sq ft apartment, this translates to $1,450 to $1,665 rental per month.

It is not known if these rents were for shoebox units. Rents for such units tend to be significantly higher on a psf basis because of their compact sizes.

There are also pitfalls amid the optimism about demand, including concerns that units in this traditional red-light district would draw the wrong crowd.

Chesterton Suntec International research head Colin Tan said: 'I have had clients ask me why all the rooms (in Geylang units) have attached bathrooms. You could read more into that, in the sense that they may be used as serviced apartments, dormitories or budget hotels.'

He added that banks may hesitate to lend to investors out of concern over the area's seedy reputation. 'In official red-light areas, some banks won't want to lend their names to such projects, because they are considered high-risk.

'Second, you are not sure if the activities that occur in those units are legal or not... Another concern is the reputation of the bank; it may not want to be associated with such properties.'

Mr Tan Kok Keong, OrangeTee's head of research and consultancy, noted that the high rental yields may be due only to the lowered capital values of property in the area.

'If you look at the projects there, they are roughly sold for between $1,300 and $1,400 psf,' he said.

'So if you take other places equally distant from the city centre, like Pasir Panjang or even Toa Payoh, and if you compare prices, then obviously there's a 5 per cent to 10 per cent discount for Geylang.

'Part of the reason is the reputation.'

Condo prices down but landed home prices edge up

Prices of condominiums softened in the first quarter but resale prices of landed homes edged up in the same period, according to the latest estimates released by DTZ.

High-end condo prices fell 0.8 percent while values of freehold condominiums slipped 0.7 percent from the previous quarter. DTZ said this was mainly attributed to the additional buyer's stamp duty (ABSD) implemented in early December.

It noted that competition from uncompleted projects was also a big factor, with an average of 2,200 units, excluding executive condominiums (ECs), being launched in the first two months of this year. In comparison, around 1,510 condo units were launched each month in 2011.

Despite the additional stamp duty imposed by the government, sales of non-landed homes in the primary market soared in the first quarter. Meanwhile, freehold landed homes in suburban areas recorded a price increase of 1.6 percent in Q1 while those located in prime districts 9, 10 and 11 inched up one percent during the period.

“The strong showing in the primary market was, however, not widespread, and was driven mainly by a few popular projects such as The Hillier, Watertown, Parc Rosewood and Guillemard Edge, which contributed to more than half of the sold units in January and February,” said DTZ.

“These projects enjoy attractive locations near MRT stations and offer small affordable units which reflect the trend in the market of investors eager to park some of their money in property to earn better returns.”

Primary sales (excluding ECs) hit an average of 2,143 units per month in Q1, up from a monthly average of 1,364 units in 2011.

“We expect a higher proportion of local buyers to dominate the market as foreigners take time to adjust to the new 10 percent buyer's stamp duty they now have to pay,” said Chua Chor Hoon, Head of Asia-Pacific Research at DTZ.

However, she said that the popularity of uncompleted suburban projects is expected be healthy.

“If demand continues to remain strong at above 1,500 units a month, we do not preclude the possibility of further government cooling measures.”

HDBs more unaffordable than private homes

Housing and Development Board (HDB) resale homes in Singapore are more unaffordable than private homes, PropertyGuru can exclusively reveal. They are also classed as being ‘severely unaffordable’.


Using a globally-recognised formula where the Median Multiple (median house price divided by the annual median household income) is used to calculate housing affordability, HDB resale flatsare also classed as being severely unaffordable using a scale which was most recently published in the 8th Annual Demographia International Housing Affordability Survey.


Housing affordability is evaluated based on the quotient deduced from the given formula, where a result of 3.0 and below would imply that houses are affordable, 3.1 to 4.0 (moderately unaffordable), 4.1 to 5.0 (seriously unaffordable), and 5.1 and over (severely unaffordable).


Given that the international report centred on the mid-end market, PropertyGuru focused its attention onprivate apartments and condominiums within the Outside Central Region (OCR) and Rest of Central Region (RCR), as these areas are home to most of the mid- to high-end properties.


The median multiple is based on calculations using the median household income from Singstat’s Key Household Characteristics and Household Income Trends, 2011, and the median price for all types of resale HDBs, ranging from one- to five-room and executive flats, according to data from the HDB andPropertyGuru.


The median multiple for private properties is 6.03 which means they are ‘severely unaffordable’ but for HDB resale flats, the result is arguably shocking. The median multiple was found to be at a high of around 6.7, which lies within the ‘severely unaffordable’ bracket – and even more unaffordable than private properties.


While private properties and HDB resale flats hit the ‘severely unaffordable’ mark, it has to be noted that the monthly household income for HDB dwellers is considerably lower than that of private homeowners.


Tejaswi Chunduri, Regional Analyst at PropertyGuru, offered her insights on the findings. She said: “The data is reflective of the housing affordability issues the country has been facing the past few years. In the last five years the median household income in Singapore has increased by 42 percent whereas HDB resale prices have shot up by 84 percent according to the HDB price index. Private property has risen 58 percent when we look at the private property price index.”


She added: “This is a great contradiction to HDB's role which is to offer affordable housing to the masses,” however she was quick to add that homes in Singapore are more affordable than Hong Kong which earned a rating of 12.6.


Despite the high prices, private home sales in Singapore continue to skyrocket, rising 29 percent in February from the previous month. “It is yet to be seen if the multiple rounds of cooling measures and other policies introduced by the government will prove effective in making home prices more affordable,” added Chunduri.


The HDB was contacted for an official statement but were unable to issue any comment prior to publication.

Singapore, HK office rents to fall by at least 15 per cent: Report

Hong Kong and Singapore commercial property rents and prices will drop by more than 15 per cent this year as financial services companies keep a lid on growth or shrink, according to Jones Lang LaSalle.

Hong Kong rents will drop by 15 per cent this year and prices by 16 per cent, while Singapore rents will fall 11 per cent and values 20 per cent, Mr Alastair Hughes, Asia-Pacific chief executive officer of the world’s second-biggest publicly traded commercial-property broker, said at a presentation in Sydney.

Global firms have become more mindful of costs amid Europe’s sovereign debt crisis, with companies including Royal Bank of Scotland, Macquarie Group and Daiwa Securities Group among the latest to announce job cuts in the Asia- Pacific region.

Office rental growth slowed to 0.9 per cent across the region in the quarter ended Dec 31, from 2.5 per cent in the previous three months, as rising supply in China and India pushed vacancies higher, Jones Lang LaSalle said last month.

New Delhi will see a 28 per cent rise in supply, followed by Shanghai which will add 25 per cent more space this year, Hughes said today.

Rents and prices in Beijing and Jakarta will be underpinned by strong economic and revenue growth, he said.

“We’ve had a synchronised downturn, but a variable recovery,” Mr Hughes said.

“Some values are growing, like in China and Indonesia, some are flat, like in Tokyo and Seoul, some are falling, like in Hong Kong and Singapore.”

Source : Channel NewsAsia – 22 Mar 2012

Housing rents to increase around the world: Savills

Rental values in the global residential property market are climbing fast, as demand from local and international corporate tenants’ rises rapidly, noted Savills, a London-based consultancy. 

According to the Savills World Class Cities Index, the average rental increase in the second half of 2011 hit 2.3 percent, with Paris as the most expensive city for tenants. 

Paris (pictured) tops the chart replacing London, with rents now more than three times compared to Mumbai and Shanghai. The star performer was New York, where rental values increased 6.5 percent in the first half and another 6.2 percent in the second half of last year.

“The majority of new world cities saw reduced rental growth in the second half of the year,” said the report.

“The notable exception was Singapore, where rental values rose by 4.4 percent in the first half of 2011 and a further 5.0 percent in the second half of the year.”

It noted that the introduction of the additional buyer’s stamp duty (ABSD) in December will further benefit the rental market.  

By contrast, other new world cities, particularly Shanghai, Hong Kong and Moscow, saw rental growth declines in the second half of 2011.

Savills also analysed the cost of buying property in the world’s 10 leading global cities, and it showed that costs of buying and occupying properties in Shanghai and Mumbai are higher in relation to relatively low rents that they equate to over four years of rental costs.

In Singapore, the figure is around three years.

“Demand for owner-occupation in these markets is likely to fall at times when little or no capital growth is expected,” said Yolande Barnes, head of Savills Residential Research. 

“The result will no doubt be that the oriental new economies will become low-yielding, high volatility markets where the challenge will be to meet tenant demand to investor appetite for bringing forward supply,” she added.

Toa Payoh flat sold for record S$894,000

The sale of a three-year-old five-room HDB flat in Toa Payoh (pictured) back in February has caused quite a bit of buzz online with some netizens wondering how the owner was able to sell the flat for S$894,000, which was more than twice its original price.

Sold just three years after its completion, the flat located between the 36th and 40th floors of Block 79C in Toa Payoh Central has created a new record price for the area. 

According to a HDB spokesman, the block was constructed as a replacement block to relocate residents under the Selective En Bloc Redevelopment Scheme (SERS). The flats have a Minimum Occupation Period (MOP) of five years from the effective date of purchase or seven years from the selection date of the unit, whichever is earlier.

“For SERS replacement flats that have met the requisite period, the flat owners may sell them in the open market. For the case you (netizens) cited, the seller had already met the seven-year MOP, and hence was eligible to sell his flat in the open market,” noted the spokesman. 

Commenting on the case, Mohamed Ismail, Chief Executive of PropNex Realty said “the seller was lucky for a number of reasons.” 

“He has fulfilled the seven years under SERS. He may also have bought it at a slight discount under the SERS subsidy. And the flat has a central location in Toa Payoh.”

HDB’s website showed that the median resale price for a five-room unit in Toa Payoh in Q4 2011 was S$645,000.

The owner had expected to sell the unit at over S$900,000 but eventually settled for S$894,000, said Shawn Guan, the ERA agent who represented the seller. 

Developers' bids for sites indicate falling home prices

With concerns over a possible drop in private home prices of up to eight percent this year, many developers are becoming more cautious on how much they are willing to pay for private home sites.

Deciding on the prices to offer for a plot on sale, developers need to take into account the possibly lower home prices into their sums.

According to a BNP Paribas report, which analysed about 100 government land sale bids from 2007 to last month, developers are lowering their bids on land sites because of the uncertainty on whether prices will hold up by the time they would have to sell theproject.

When bidding for a site, developers consider the break-even figure – meaning how much they will pay for the project, taking into account the costs of building it as well as other finance, administration and marketing costs, plus a little extra in terms of profits.

The report revealed that beginning in mid-2011, the difference between developers’ expected break-even price and existing selling prices widened to 19.8 percent, way above the mean of 12.1 percent.

The 12.1 percent mean represents the profit margin which developers have achieved on average. The eight-percentage point difference likely reflects developers’ efforts to guard against possible increases in selling prices.

Chong Kang Ho, an analyst at BNP Paribas, noted that a similar pattern was observed in Q2 2008 before home prices tanked and when margin buffers widened in the same manner.

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Global home prices to fall in 2012

The Knight Frank Global House Price Index (GHPI), which tracks the performance of mainstream home prices worldwide, showed that global home prices dropped in 60 percent of the countries tracked by the index.

Knight Frank said if this trend continues to spread, the overall GHPI could fall into a negative level this year.  

“A combination of global economic uncertainty, weak consumer confidence and strict mortgage lending criteria are dampening growth in Europe and North America while stringent government cooling measures in Asia Pacific are successfully curtailing house price inflation there,” it said.

According to the index, global home prices edged up 0.5 percent in 2011, but recorded a 0.3 percent slip in the final three months of last year, representing the index’s weakest quarterly performance since Q2 2009.

“This suggests that a return to significant house price growth around the world is some way off yet,” it noted.

Overall, all 12 of the bottom rankings are occupied by European markets, with Ireland taking last place, recording a 17 percent decline.

“However, not all European markets are in a moribund state. Estonia, Slovenia, Iceland, Norway, Switzerland and Germany achieved annual growth over five percent, despite the precarious state of the Eurozone’s sovereign debt crisis.” 

Meanwhile, the GHPI showed that the top five countries recording the highest price growth over five years (Q4 2006 - Q4 2011) were China, Hong Kong (pictured), Israel, Singapore and Colombia. Singaporeplaced fourth with an overall increase of 50.5 percent over the five-year period.

“Asia’s downturn has proved highly influential,” said the firm. 

“In 2007, China, Hong Kong and Singapore saw price rises of 42 percent, 21 percent and 33 percent respectively. Last year, growth was -2 percent, 11 percent and five percent.”

KTC Group launches maiden residential project

Construction company KTC Group has made its first venture into the real estate market with the launch of its maiden project,Summer Scent, a freehold residential development at the junction of Upper Serangoon Road and Hougang Avenue 2.


Developed by KDC (Kovan) Development, Summer Scent offers 16 apartments comprising two-bedroom units of between 581 sq ft and 1,711 sq ft, as well as three-bedroom units with a built-up area of between 1,065 sq ft and 1,905 sq ft. So far, six units have already been snapped up.


The two-bedroom units are being marketed at an average price of S$1,200 psf, while the two-bedroom penthouse units (inclusive of family room, jacuzzi and roof terrace) cost S$1,088 psf. Meanwhile, prices for three-bedroom units stand at around S$1,200 psf and for the three-bedroom penthouse units (inclusive of family room, roof terrace, study and Jacuzzi) at S$1,086 psf.


KTC said the project is expected to be completed by August 2012.

Top bid for Hillview Ave site beats expectations

(SINGAPORE) An 'overly optimistic' top bid, a whopping 18.6 per cent higher than the next, was put forth by Kingsford Development for a 99-year residential site located along Hillview Avenue yesterday.

Its bid of $243.2 million or $638 per square foot per plot ratio (psf ppr) for the 136,147 sq ft plot with a plot ratio of 2.8 came even as other developers adopted a more cautious stance.

The bid may have been pegged to The Hillier's land price of $673 psf ppr when the site was tendered in April 2011, suggested Credo Real Estate executive director Ong Teck Hui.

However, The Hillier's land price takes into account a 15 per cent commercial element in the project, which contributed to its achieving the pricing level of its residential units, he noted.

Li Hiaw Ho, executive director, CBRE Research, agreed, noting that the success of The Hillier, also on Hillview Avenue, could be the reason for the optimistic top bid for the site. Mr Li expects a breakeven cost of between $1,000 and $1,050 psf.

The second highest bid of $205.1 million, or $538 psf ppr, put in by Flamegold Pte Ltd, a unit of UOL Group, was more in line with analyst expectations when the site was released for tender in January.

UOL's bid of $538 psf ppr could have resulted in a breakeven price of $900 to $950 psf, which 'could provide the developer with some space to manoeuvre in the event of a softer market', said Nicholas Mak, executive director of research and consultancy at SLP International.

'The top bid for this Hillview site could result in a breakeven price of $1,010 to $1,060 psf. To yield a decent profit, the developer would have to sell the units in the development at prices above $1,200 psf,' he added.

An ACRA search shows that Kingsford Development has three shareholders, of whom one is based in Shenyang, China.

The third highest bid came from MCL Land, at $190.5 million, or $500 psf ppr. Far East Organization's Astor Properties and Tannery Holdings also put a joint bid with Sekisui House of $176.3 million, or $463 psf ppr. The lowest bid came from Capital Development and Qinghe, at $148.0 million, or $388 psf ppr.

'Although the top bid is 5.1 per cent lower than the previous bid of $672.61 psf ppr submitted by Far East Organization in April 2011, we feel that the bid is a bit optimistic given that it is 18.6 per cent higher than the second bid and the previous site is a mixed use site while this is a pure residential site. We noticed that all the bids are slightly lower than the previous bids for The Hillier site which means that developers could be adopting a cautious stance,' said Lee Sze Teck, senior manager for research and consultancy at DWG.

As evidence that the mass residential market is still buoyant, Bartley Residences, located next to Bartley MRT Station, sold 210 units out of the 240 units released to date.