URA Realis reported that the four residential launches received a very different profit rate from the housing buyer. Analysts believed that pricing the projects was on the high side considering that developers acquired sites before the government implemented the housing cooling measures.
On the report, SC Global Development’s Cuscaden Reserve sold five (5) of its unit with unit price of $3,341 per square foot, almost similar to luxury residential projects in prime districts like of Boulevard 88 which had sold 73 units at $3,662 per square foot and 14 units were taken up at 3 Orchard By-The-Park with average selling price of $3,621 per square foot. This median price leads to a slim profit of 8 – 10 percent.
The same case to the ventured residential project of Hock Lian Seng Holdings, Keong Hong Holdings and TA Corporation’s The Antares with a median price of $1,794 per square foot, considered too high for development in an untested site. This selling price gives only a 14 percent profit margin.
More on Two Different Cases For Recent Condo Launches
Despite the low-profit margin, the developers of Cuscaden reserve and The Antares believed that launching now is better considering the consequential supply from projects in the pipeline.
However, this was not the case to two other development projects, [email protected]’s of Low Keng Huat and Meyer Mansion of Guocoland. The two benefitted favorable marginal profit of 24% to Meyer Mansion’s $2,728 per square foot unit price with 21 units taken up and 25% to Uptown @ Farrer’s $1,860 per square foot unit price which has sold out 12 of its units.
With this scenario, Guocoland and Low Keng Huat had still enough space on pricing their project to even better prices and a high probability of selling more units on its future launches.
Nonetheless, developers did not expect to correct private home prices but still positive that it would be sold off eventually.