Property developers are courting home buyers with additional direct discounts or rebates, days after the government introduced new measures to cool the private residential market.
Some are also raising commissions to get agents to bring buyers to their launches, in anticipation of buying sentiment being hit by higher Additional Buyer's Stamp Duty (ABSD) rates and tighter loan limits introduced on Thursday (July 5).
Oxley Holdings has offered an additional 5 per cent to 7 per cent stamp duty discount "for this weekend only" at its Affinity At Serangoon project, as seen in its newspaper advertisement on Saturday.
The price of a one-bedroom unit fell to $676,000 from the June 30 price of $712,000, while a two-bedroom unit now costs $878,000, down from $945,000, and a three-bedder around $1.19 million from $1.27 million.
OrangeTee & Tie head of consultancy and research Christine Sun said: "As of now, we're not seeing huge discounts being offered, more in the range of about 3 to 5 per cent possibly to offset the impact of ABSD." She said that agent commissions could be raised too.
National Development Minister Lawrence Wong said that the cooling measures were introduced because of concerns that the sharp recovery in private home prices "is running ahead of economic fundamentals".
Citing rising interest rates and a large supply of units in the pipeline, he said the aim is to avoid a severe correction later that could have more destabilising consequences.
There were about 24,000 unsold units from projects with planning approval as of last month. In addition, more than 30,000 existing private housing units remain vacant.
At Logan Property and Nanshan Group's Stirling Residences showroom yesterday, Mr Noah Lee, 34, and his wife, Cris Tay, 31, said they were offered a 126 square-metre four bedroom unit for $2.08 million, down from $2.29 million a week ago.
Mr Chng Chee Beow, executive director of Logan Property (Singapore) said: "Because we only released 380 units in our first phase, we had to re-adjust the pricing for these units. However, we still maintained pricing with a consistent average of $1,800 psf for the entire 1,259-unit project."
To date, more than 55 per cent of phase 1 - or 210 units - have been sold, with close to 200 units sold on Thursday alone. The one-bedroom and two bed-room apartments in the Queenstown development were most popular, he said.
The Straits Times understands that discounts may be offered at projects including Bijou, Sixteen35, Martin Modern, Kandis Residences, Wallich Residences, Sims Urban Oasis, and 33 Residences.
JLL national research director Ong Teck Hui said developers with upcoming launches may be in a dilemma. Some may postpone their launches for fear of poor sales take-up while others may want to gauge market response to existing launches before deciding if they want to lower their launch prices.
Ms Sun said for projects that will be launched a few months later, developers still have time to change their marketing and pricing strategies.
Sim Lian Development, which acquired Tampines Court for a record $970 million in August last year, said it is "digesting the new measures and will monitor the market." CapitaLand, UOL Group and GuocoLand declined to comment.
A Knight Frank agent, who is marketing Affinity and declined to be named, said the measures have moved some developers to take unusual steps to boost demand.
"Normally on the first day of launch, they will put the developer's contact information in the newspaper advertisement. Now they are including individual marketing agents' names as well, because they want more buyers in," she said.
Adapted from The Straits Times, 7 July 2018.