http://www.straitstimes.com/archive/saturday/premium/money/story/lower-prices-panorama-relaunch-tomorrow-20140510
Lower prices at Panorama relaunch tomorrow
Agents say prices could be 14% lower than at January's initial launch
Published on May 10, 2014 1:11 AM
By Melissa Tan
THE Panorama condominium in Ang Mo Kio goes back on sale tomorrow at a discount, the latest in a recent string of relaunches.
The new prices could be up to 14 per cent lower than at the initial launch in January, according to marketing agents.
Consultants said more projects could be put back on the market at lower prices in the coming months as some developers may have to sell units to pay for the project's construction.
Developers may also be encouraged to do so because recent condo repricings by their rivals have managed to move a decent number of units, they noted.
At The Panorama's relaunch tomorrow, prices for a one-bedder could start at $565,000 in total, according to marketing agents.
This is about 14 per cent below the lowest price paid for the smallest one-bedder in January - $658,670 for a 431 sq ft unit.
A two-bedder could start at $820,000 and a three-bedder $1,175,000. New prices for larger units such as four- and five-bedders and penthouses were not advertised.
The new prices work out to a range of $1,100 to $1,310 per sq ft (psf), lower than the previous average of $1,366 psf, according to caveats lodged with the Urban Redevelopment Authority (URA).
The 99-year leasehold project has sold poorly, partly because home loan curbs set last year have made it tough for buyers to afford more expensive units.
The developer, Wheelock Properties, moved 58 units in January at a median price of $1,343 per sq ft - just 8 per cent of the 698 units available. It had sold only 57 units in total by end-March, going by the latest available URA data, indicating that some units had been returned by their buyers.
Wheelock said in its first-quarter results yesterday that it had sold 56 units at $1,365 psf. It did not specify the average price.
The slow take-up had prompted Wheelock to write off $110 million for the project, which sent it into the red for the three months to Dec 31 last year.
Wheelock had paid $550 million for the land in Ang Mo Kio Avenue 2, which works out to $790 psf per plot ratio (ppr) for the nearly 1.85ha site - far higher than the $560 and $650 psf ppr analysts had expected.
Consultants yesterday said more condo relaunches could be on the horizon, with likely candidates being projects that have moved fewer than half their units.
"Developers generally need to get some cashflow so they don't have to dig into their own pockets to carry on the development," said CBRE research head Desmond Sim. But he noted that the threshold at which developers would need this extra cash depends on their profit margins from the project and the complexity of the construction.
OrangeTee research head Christine Li said "very good results" from recent condo repricings may also entice other developers to relaunch their projects.
The 75-unit freehold Hallmark Residences in Bukit Timah, for instance, managed to sell 26 units in February and a further 13 in March after its developer, MCL Land, cut prices.
CapitaLand's 509-unit Sky Habitat project in Bishan sold 80 units the day it relaunched last month, at prices about 10 to 15 per cent lower than at its initial launch two years ago.
Projects launched last year that have sold fewer than half of their units so far include Hillion Residences in Bukit Panjang, Kingsford's Hillview Peak in Bukit Batok, Vue 8 Residence in Pasir Ris and The Glades in Tanah Merah.
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