Sales at recently established executive condominiums (ECs) haven’t been leading despite the large number of e-applications received, reported The Business Times.
Nonetheless, seven out of the 14 EC projects established since 2014 failed to reach even the minimal conversion rate during their launching weekend.
The most recent EC to start was the 628-unit Parc Life. Together developed by Keong Hong Holdings and Frasers Centrepoint Limited, it exclusively sold 51 units during its launch last weekend despite recording over 700 e-applications.
During the week prior to that, Qingjian Realty’s The Visionaire sold 158 units out of 632 units, though it attracted 859 e-applications while the upcoming EC @ anchorvale crescent Treasure Crest is going to launch soon.
In comparison, the number of e-applications some EC projects received in 2011 to 2013 easily surpassed the volume of units offered by two times during the marketplace’s heyday, said Managing Director of KF Property Network, Tan Tee Khoon.
Based on Nicholas Mak, Executive Director of SLP International, the low take-up rate is because of the substantial supply. “It’s only too much for the market to digest in that period of time (as) demand for ECs in suburban areas tend to be restricted to upgraders or individuals who live in the place.”
This is notably true for developments being assembled for multiple ECs and launched at around the same time, as they are competing for exactly the same pool of eligible buyers who most likely submitted e-applications in the exact same area.
For instance, Parc Life and The Visionaire are found in Sembawang, in the exact same neighbourhood where The Brownstone made its introduction in July 2015. In Yishun, The Criterion was unveiled last October, followed closely by Signature At Yishun.
Century 21 Chief Executive Ku Swee Yong considers the weak sales “are conclusive signs that demand is exhausted for this type of property. Based on the present rate of EC trades, he believes the marketplace needs at least two years to completely absorb the remaining unsold units.