While this is exciting for some real estate investors, this isn’t probably good news for the weakening Singapore market. Based on the quarter-on-quarter data, the amount of real estate properties up for auction have greatly increased by as much as 2.9 percent. During the second quarter alone, there were already about 180 units that were available for auction. This was from the report made by Knight Frank Singapore and was also delivered by The Strait Times as well.
As for the smaller units that became available for public sale, mostly were one to two bedrooms, it increased from 27 to 28.6 percent based on the quarter-on-quarter data.
According to the report from Knight Frank Singapore, most of the people who used to own the units weren’t able to pay the rest of their mortgage due to the insufficient funds from their rental income.
Mortgagees on the other hand sold a couple of shoebox-type units during the auction. The rental for this type of unit is gaining big competition since private homes market is also increasing its supply. The latter is also gaining more appeal compared to the shoebox-units from various condominium developers. Although the new launched developments such as High Park Residences, The Venue Residences and the Botanique at Bartley are comfortable that rental income would suffice to the mortgage payment of their owners.
But despite the fact that more properties became part of the auction during the Q2, there were only 7 units got their new owners. The percentage of auctioned units also went down from 36.4 during the first quarter last year to 22.2 percent during the Q1 this 2015.
The auction itself also experienced big decline. The rate of success experienced during 2015’s first quarter auction was as high as 6.3 percent whereas the Q2’s success rate was only a mere half of Q1, a big decline to 3.9 percent.