Your search results

Will New Launch Condos See a Drop in Prices Soon?

Posted by Jayson Ang on July 12, 2024

| All, Buying Tips, Opinion, Selling Tips

| 0

TLDR

The real estate market in Singapore is experiencing a trend of lackluster bids for prime properties in various locations.

Recent bids for land parcels near Springleaf MRT station and on Zion Road have fallen below predicted price ranges.

Factors contributing to this trend include cooling measures, rising construction costs, financing challenges, and global uncertainties.

Developers’ reluctance to participate in high-profile locations like River Valley and Marina Bay reflects a retreat in the market.

The Core Central Region (CCR) is particularly affected by these challenges.

To revitalize the CCR, suggestions include extending ABSD deadlines for developers to attract local buyers and reignite interest.

The release of land parcels in River Valley may not attract competitive bids due to low developer interest.

The shift towards creating well-rounded communities in prime areas like Orchard contrasts with the slow adaptation of the CCR.

Exploring mixed-use projects could accelerate the transformation of areas like River Valley.

Individual considerations are crucial when deciding whether to buy, sell, or wait in the current real estate market.

It is becoming increasingly evident that the rejected bid for Marina Gardens Crescent was not an isolated incident but rather a recurring trend. The solitary offer made for the coveted location was deemed too low and was swiftly dismissed, but it seems this was just the beginning. Now, we are witnessing similar lackluster bids for properties in River Valley and Upper Thomson.

GuocoLand and Hong Leong were the sole contenders for a prime plot of land near Springleaf MRT station, along Upper Thomson Road, with a bid of $779.6 million (equivalent to $904.60 psf). This was a far cry from the predicted $1,000 to $1,100 psf. One can’t help but wonder if the underwhelming sales figures of other condos like Lentoria, which only managed to sell 19% of units during its launch, played a role in this low offer. It’s not surprising considering GuocoLand’s already dominant presence in the area.

Similarly, CDL and Mitsui Fudosan were the only bidders for a massive land parcel on Zion Road, with a bid of $1.1 billion (capable of housing around 1,000 residential units). This equates to approximately $1,202 psf, below the estimated $1,300 to $1,700 psf.

These scanty bids, coupled with the reluctance of developers to participate in high-profile locations like River Valley and Marina Bay, reveal a clear retreat in the market. The recent cooling measures, particularly the raised ABSD of 60% for foreigners, has significantly impacted the prime region properties which heavily rely on this demographic.

Of course, there are other contributing factors such as rising construction costs (Singapore has been ranked the fourth most expensive country for construction since last year), financing challenges due to the higher interest rates, and global uncertainties. However, the CCR (Core Central Region) seems to be bearing the brunt of it all, compounded by the cooling measures.

Moreover, the upcoming land parcels at River Valley Green and the newly implemented GFA harmonisation rules may have also played a role in the lackluster bids.

Interestingly, this weak demand is in stark contrast to the 2017 bidding war for the Jiak Kim Street GLS site (now known as Riviere), which saw a whopping 9 bidders and a record high of $1,733 psf ppr. However, the not-so-impressive performance of Riviere may have acted as a deterrent, as the developers had to resort to price discounts in 2020 and the final average price of $2,819 psf was far from their initial expectations. After all, the original launch prices were hovering around $3,000 psf.

Why Are These Land Parcels Being Released Now? Unveiling the Timing Mystery

While the Government’s decision to put up land parcels in River Valley may have a sound rationale, it’s unlikely to attract competitive bids. In fact, it seems like a wasted opportunity, especially when developers have shown little interest. Even if the land prices were lower, it’s doubtful that the average Singaporean would even consider purchasing property in these upscale districts.

This move comes at a time when prime areas like Orchard are striving to revitalize themselves. The trend now is towards creating more well-rounded communities, with a mix of event spaces and play areas, rather than sticking to outdated notions such as “Orchard is only for shopping” or “City Hall is solely for banks.”

Interestingly, the CCR (Core Central Region) has been the slowest to adapt to this rebalancing, unlike its counterparts in the OCR (Outside Central Region) like Jurong, or in the RCR (Rest of Central Region) such as Beach Road and Paya Lebar.

If developers were to construct more mixed-use projects (and let’s not forget Marina, which was a white site, as explained here), it could greatly accelerate the transformation of the CCR. After all, River Valley could certainly benefit from more character than just being known as “that place with fancy mansions.”

Perhaps, considering the nature of CCR properties, which often have a high price tag and take longer to sell, we could explore other concessions for developers. This could include extending the usual five-year ABSD (Additional Buyer’s Stamp Duty) time limit, not necessarily by reducing land prices, but by providing a longer deadline. This would allow more time for local buyers to emerge and potentially reignite developer interest, with the added benefit of lower risks. Of course, this is a suggestion solely for the CCR.

Should You Buy, Sell or Wait?

If you’re reading this, you must be trying to figure out the best course of action right now: is it the right time to buy or sell?

It’s difficult to give an exact answer since everyone’s situation is unique and what works for one person may not necessarily work for you.

I can bring you a wealth of on-the-ground experience and a data-driven approach to provide clarity and direction. From beginners to experienced investors, our top-down, objective approach will help you on your real estate journey.

I can help you by:

Offering Strategic Real Estate Advice – I can help create a comprehensive plan to guide you through your property journey.
Connecting Your Home with the Perfect Buyers – Through stunning visuals, an effective communication strategy, and an in-depth knowledge of the market, we’ll ensure your home is presented in the best possible way to fulfill your goals.

You May Also Like …

All Blog Posts Buying Tips

Should We Upgrade to a Condo Now or Wait for Interest Rates to Go Down?

Jayson Ang – January 18, 2023 –

TLDR Considering the Singapore property market trends and financial factors, it's crucial to make informed decisions about upgrading from an...

Mandarin Top 5

Top 5 Tips: Gain an Edge in the Singapore Property Market: Steps to Boost Your Investment Returns

Jayson Ang – May 11, 2025 –

The Singapore property market has always been a hotbed for investors looking to make substantial returns on their investments. As...

All Buying Tips Opinion Selling Tips

Singapore’s Property Jungle: A Guide to Every Development Type

Jayson Ang – October 12, 2025 –

TLDR Singapore’s real estate market features a diverse mix of property types—public HDB flats, executive condominiums, private condos, landed homes...

All Blog Posts Buying Tips Reports

Are Cluster Landed Homes Still a Good Investment? Analyzing Their Performance Over the Past Decade

Jayson Ang – October 19, 2024 –

TLDR When it comes to cluster housing, freehold properties like Bishopsgate Residences command top prices, whereas bargains can be found...

All Blog Posts Opinion

Unlock the Potential of Your Home: 5 Reasons to Start Selling Now

Jayson Ang – June 6, 2023 –

TLDR When considering selling your home, several key indicators can help you determine if it's the right time to make...

Mandarin Top 5

Top 5 Scenic Drives in Singapore

Jayson Ang – June 4, 2024 –

Singapore, a small yet bustling city-state, is well-known for its impressive skyline, diverse culture, and delicious food. However, not many...

Mandarin Top 5

Top 5 Factors To Consider When Choosing Between A Resale Condo And A New Launch In Singapore

Jayson Ang – June 17, 2025 –

TLDR Choosing between a resale condo and a new launch in Singapore depends on your priorities as an investor or...

All Buying Tips Opinion

Leasehold vs. Freehold Condos in Singapore: A Decade of Data

Jayson Ang – December 14, 2025 –

TLDR In Singapore’s property market (2014-2024), leasehold condos often outperform freehold in short-term holding (around 10 years) due to lower...

All Buying Tips

ANALYSIS: Unveiling the HDB Towns with the Steepest and Lowest Price Surges!

Jayson Ang – August 17, 2024 –

TLDR The real estate market for HDB flats in Singapore has witnessed significant growth, with prices reaching new highs. The...

Mandarin Top 5

Beyond Marina Bay Sands: Uncovering Singapore’s 5 Little-Known Secrets

Jayson Ang – July 29, 2023 –

Beyond Marina Bay Sands: Uncovering Singapore's 5 Little-Known Secrets Singapore is a small country with a rich history and culture....

Mandarin Top 5

5 Tips for Renting Property in Singapore

Jayson Ang – March 15, 2024 –

Renting property in Singapore can be a challenging task, especially for those who are new to the country. With Singapore's...

All Buying Tips Opinion

The Integrated Living Experience: Benefits and Drawbacks of Condos Above an MRT

Jayson Ang – January 22, 2026 –

TLDR Integrated developments in Singapore combine residential units with commercial spaces and direct MRT access, offering convenience and car-free living....