Singapore property auction sales for January-June amount to $87mln

80% of all properties put to auction were owner’s sales to capitalize on the auction process.

1H2010 auction sales in Singapore total approximately S$87 million have been impacted by the increase in properties put to auction by owners. Jones Lang LaSalle’s Auction House reported that more than 80% of all properties listed were owner’s sales.

Ms Mok Sze Sze, Head of Auctions, Jones Lang LaSalle commented “We’ve seen an increase in the number of properties listed by owners at auctions this quarter. This is due to a change in mindset that auctions are not only for mortgagee sale, and are being widely recognised as an effective mode of sale, according to a Jones Lang LaSalle report.

“Many owners are taking advantage of the auction process including the buyers’ upfront 10% deposit and lack of a cooling off period. We’re also noticing more non-residential deals for HDB shophouses, and commercial space with existing rental yield,” Ms Mok added.

At Jones Lang LaSalle’s April auction, a HDB shop with living quarters located at Ang Mo Kio, listed as owner sale achieved a sale price of 23% above the opening bid. It is understood that prior to the completion of the sale, tenants were already lined up to fill the premises.

Jones Lang LaSalle reported that auction attendee numbers also increased in comparison to Q1, the June auction had attendance rates of over 120. Auction attendees in Q2 were a combination of potential sellers investigating the auction sale process, and potential buyers monitoring the current market conditions for purchase.

“Post auction activity remained strong for non-residential property listed for sale at our auctions in Q2. We expect that Q3 will see maintained levels of owner sale listings and with people returning from school holidays are likely to see an increase in sales activity,” Ms Mok commented.