Land bidding wars heat up even as property market cools

There are more bidders but prices are weaker.

Developer interest in residential land parcels continues to stay strong despite the cooling property market, according to a report by BNP Paribas.

The report showed that current winning bids are more conservative compared to prices before cooling measures were implemented. Despite this, the number of bidders has remains healthy at 9.3 developers per site, up from 7 in 2014.

"Overall, we observed that in 2015 Sep YTD, the competition for land remains strong, with more number of bidders per tender site, more 'non-traditional developers' securing sites, plum sites attracting higher bids," BNP Paribas said.

Demand has been propped up by bids not only from local developers, but also from foreign companies and construction-related firms.

"We see more developers entering the land market to restock their depleting land bank. They may also be anxious to do so, given the supply cut in the GLS programme since 2014," BNP Paribas noted.