According to a report by The Business Times, sales of the executive condominiums recently launched have not been high despite the many e-applications received.
While a majority of property experts consider it acceptable if there is a 20 to 30% translation to sales of the e-applications in today’s market, this has not been the case for some of the latest launches. Seven of the fourteen EC projects launched as from 2014 did not even attain the minimum conversion rate in the launch weekend.
The latest to launch was Parc Life with 628 units. This is a joint development by Keong Hong Holdings and Frasers Centrepoint Limited, in which only 51 units were sold during the last weekend launch despite the over 700 e-applications that were recorded.
The week before that saw The Visionaire by Qingjian Realty record a sale of 158 units of the 632 units despite having received 859 e-applications.
As noted by Tan Tee Khoon, the Managing Director KF Property, the e-applications received in the market’s heydays of 2011 to 2013 surpassed the number of units on offer by two times.
Nicholas Mak, the Executive Director SLP international also noted that the low rate is due to the large supply. He observed that the supply is high while demand for the suburban ECs tends to be by the upgraders or those living in the area.
This is particularly true for developments in the same area with almost the same time launch because they compete for the same potential buyers who are likely to have submitted e-applications to several ECs.
For instance, The Visionaire and Parc Life are in Sembawang, where The Brownstone EC also launched in July 2015. In Yishun, there is The Criterion, which was launched last year in October followed by Signature.
Ku Swee Yong the Chief Executive of Century 21 believes that the low sales are due to exhausted demand for ECs. According to him, the market requires at least 2 years to absorb the unsold units.