A common marketing tactic in the real estate industry is to use the term “hot-selling” on the websites of various new launches. We often believe that a good start means a good end—so, following the traditional “wisdom of the crowd,” any property that sells out quickly is expected to perform well in the resale market. However, this isn’t always the case.
Sometimes, even if a condo has a slow sales start (for various reasons), it can still catch up later. Generally, people like to see a condo selling well before committing to a purchase. If a new launch sells only ten percent of its units upon launch, the typical assumption is that something must be wrong, right? Well, that’s not always true.
In this list, the following condos all had slow sales at launch but have since performed much better than most people expected.
How we picked the condos on this list
The following condos sold less than 30% of their total units within the first six months (which is considered slow by industry standards). However, based on resale transactions up to May 2022, these projects have seen 90% or more of their transactions turn a profit.
1. Sims Urban Oasis
Location: 2 Sims Drive (District 14)
Developer: GuocoLand
TOP: 2017
Tenure: 99-year
Number of units: 1,024
Launch sales: 26% sold in the first six months
Percentage of profitable resale transactions: 99% (181 gains, 1 loss)
Average profit: $128,461
To be fair, Sims Urban Oasis was launched in phases, so it was never going to sell out all at once. But even when it launched 200 units per phase, it only managed to sell just over 100 of them—not a stellar result. The biggest issue at the time was the slow and sluggish market (it was heading toward the 2017 trough).
There were two other factors that may have contributed to the slow sales at the time:
First, this is a mega-development with over 1,000 residential units; a high unit count also comes with a dense area. There isn’t much greenery or open space around, and it was thought that family buyers wouldn’t appreciate this.
Second, there were concerns that it’s less than a 10-minute walk from the Geylang red-light district. In practice, this is a non-issue as Sims Urban Oasis is sufficiently far away—but buyers are always a little wary of the Geylang area. Vice-aspects aside, some buyers also found the area to be a little run-down and congested.
However, sales for Sims Urban Oasis have since picked up, thanks to the transformation of Paya Lebar. The condo is a six-minute walk to Aljunied MRT, and from there it’s just one stop to Paya Lebar Quarter (PLQ). This is an area with a cluster of malls and Grade A offices, which renewed owner-occupier interest in Sims Urban Oasis.
As some residents can also attest, Sims Urban Oasis is very close to several foodie enclaves, many of which are open late into the night (our red-light districts are probably better known for their food).
That said, Sims Urban Oasis still lives up to its name: it’s an oasis for urbanites who don’t mind living in a concrete jungle. It’s convenient, newer, and better priced than many of its Paya Lebar counterparts; but this comes at the cost of less green space.
2. The Panorama
Location: 8 Ang Mo Kio Avenue 2 (District 20)
Developer: Pinehill Investments Pte. Ltd.
TOP: 2017
Tenure: 99-year
Number of units: 698
Launch sales: 27% sold in the first six months
Percentage of profitable resale transactions: 100% (138 gains, no losses)
Average profit: $239,235
The Panorama sold so slowly that Wheelock Properties lost $110 million on the project in 2013. The main reason was the weakness of the property market at the time. The Monetary Authority of Singapore (MAS) had announced new cooling measures in January 2013, along with the introduction of the Total Debt Servicing Ratio (TDSR) framework.
The Panorama was particularly affected because it was perceived as being pricey (high-end condos tend to be the first to be affected by cooling measures). Wheelock Properties had a reputation as a high-end luxury developer, and this was compounded by their high bid for the land plot: $550 million for the Ang Mo Kio Government Land Sales (GLS) site.
Sales for The Panorama only picked up when prices were slashed from a median of $1,343 psf to an astonishing $1,200 psf.
This may account for the large number of profitable transactions today.
Even back then, a new high-end condo for under $1,300 psf was a great deal – so the initial buyers got a bargain.
Location-wise, the big highlight of The Panorama is its proximity to the prestigious CHIJ St. Nicholas Girls’ School, which is just a five-minute walk away. It is also a six-minute walk to the Mayflower MRT station on the Thomson-East Coast Line.
Related Articles:
3. The Trilinq
Location: 28 Jalan Lempeng (District 5)
Developer: Clementi Development Pte. Ltd.
TOP: 2017
Tenure: 99-year
Number of units: 755
Launch sales: 14% sold in the first six months
Percentage of profitable resale transactions: 90% (103 gains, 11 losses)
Average profit: $190,715
The slow initial sales of The Trilinq can be summed up in one phrase: void area. We’ve explained before how this can be a waste of money, but in short: the condo units feature high ceiling heights, and this vertical space is counted as part of the strata area you purchase.
Some units at The Trilinq had a substantial amount of void space – some with impressive six-metre high ceilings in the living room. However, this may have paid off for buyers in the long run, as resale gains have been solid. We have to admit, the high ceilings are genuinely impressive and rarely seen outside of penthouse units.
Then again, there were signs that it was the developer’s plan to pace sales over the three-year construction period, rather than trying to sell out all units in a month.
Another factor to consider was the Additional Buyer’s Stamp Duty (ABSD) deadline. The Trilinq was one of the condos at risk of missing the five-year deadline (with an estimated ABSD payout of $50.9 million plus interest). Toward the end of sales in 2017, the average price dropped to around $1,200 to $1,300 psf (compared to an average of $1,505 psf at launch). So, this partly explains the high resale gains in some transactions today.
4. The Santorini
Location: 23 Tampines Street 86 (District 18)
Developer: MCC Land
TOP: 2017
Tenure: 99-year
Number of units: 597
Launch sales: 22% sold in the first six months
Percentage of profitable resale transactions: 92% (89 gains, 8 losses)
Average profit: $86,211
The Santorini, like The Panorama, was affected by the introduction of the TDSR limits close to its launch. There was genuine demand for the property; but during The Santorini’s launch weekend, the majority of units sold were the smaller one and two-bedders.
This was likely due to the lower quantum, which was vital for new buyers trying to meet the TDSR restrictions (the smallest one-bedders were just around $500,000 at launch). The larger units, however, proved challenging to move for the next two years.
At the time, it was also felt that the market was becoming saturated, with an oversupply of various mass-market projects, and there was also a fair amount of new supply in the area.
The Santorini also had to contend with a perennial issue: this condo does not have an MRT station within walking distance, and it caters primarily to those who drive.
Nonetheless, resale gains have been strong, thanks to the ongoing development of the Tampines area. The Santorini is less than a 10-minute drive to Tampines Hub, a major retail cluster that also has a lot of Grade A office space. With current prices around $1,240 psf and up, The Santorini is a viable alternative to the pricier and older condos closer to the Hub.
5. Principal Garden
Location: 93 Prince Charles Crescent (District 3)
Developer: UOL Group, Kheng Leong
TOP: 2018
Tenure: 99-year
Number of units: 663
Launch sales: 31% sold in the first six months
Percentage of profitable resale transactions: 99% (85 gains, 1 loss)
Average profit: $214,348
Principal Garden seems to have been aimed mainly at investors: about 70 percent of the units are smaller one and two-bedders, and the project also launched dual-key units. The trouble was, the shoebox unit craze had peaked in 2011/12. By the time Principal Garden launched in 2015, we were being bombarded by news reports on how shoebox units were oversaturating the market; and investors were getting worried about resale prospects. There was also a lot of competition nearby from Ascentia Sky, Echelon, and Alex Residences.
News reports called the sales at Principal Garden strong; but bear in mind these numbers were for phased launches (e.g., the developer only released 200 units during the launch weekend). This is a tactic often used when developers are less confident, as it helps create the impression that the condo is selling out. As you can see from the numbers above, the take-up rate was low for the first six months.
Nonetheless, Principal Garden has done very well over the years. This can be attributed to many factors, such as the gentrification of Tiong Bahru (Redhill MRT is about a 10-minute walk from the project and just one stop from Tiong Bahru MRT).
Perhaps another reason is the 80/20 land allocation method used by the developer, where 80 percent of the plot is for landscaping. Such a generous land allocation is rare these days, especially in the urbanized Rest of Central Region. Sometimes, what you see in the renders is not enough, and seeing it in real life can make all the difference.
6. The Skywoods
Location: 11 Dairy Farm Heights (District 23)
Developer: Bukit Timah Green Development Pte. Ltd.
TOP: 2016
Tenure: 99-year
Number of units: 420
Launch sales: 14% sold in the first six months
Percentage of profitable resale transactions: 93% (66 gains, 4 losses)
Average profit: $133,709
At the time of The Skywoods’ launch, the main complaint from buyers was the leasehold tenure. The nearest counterparts to The Skywoods were condos like Dairy Farm Estate and Hazel Park, which were freehold and priced much lower.
The launch date further complicated matters. The introduction of TDSR limits close to The Skywoods’ launch meant that some buyers found themselves unable to qualify for a purchase. This made it difficult for the sales team to move units until prices were lowered in 2015.
However, it has been smooth sailing for The Skywoods since then. The transformation of the area has helped to push up prices, such as the development of the nearby Hillview MRT station and the Rail Corridor.
There are other condos that performed poorly at launch but did well after
There are many reasons for property price movements, perhaps due to immediate trends or the market adjusting to new policies. We can’t point out the specific reasons for every situation in one article.
But it’s clear from the condo examples we’ve shared that launch day sales figures are not always a good indicator of future performance (though sometimes it does require some price discounting).
For more in-depth reviews, follow us at AnjiaSG. We’ll keep you updated on the latest developments in the Singapore property market.
For further enquiries, please get in touch:
WeChat: sgleokwek
Telegram: sgleokwek
WhatsApp: Message us
