Singapore auction market surged in 3Q despite subdued property sector

Total sales value of auctioned units rose by 42.8%.

The Chinese seventh month and Hungry Ghost Festival in the month of August contributed to a rather muted property sector in 3Q. Data from JLL however show that the auction market saw total sales value rise to SGD 21.2 million in 3Q16, an increase of 42.8 per cent from 2Q16’s SGD 14.8 million and an impressive 120 per cent increase from 1Q16’s SGD 9.6 million.

This uptrend in sales value brings the total to SGD 45.6 million as we enter the last quarter of 2016.

Although 14 units were sold in 3Q16, compared to only six units sold in each of the previous two quarters, only a slight increase of 42.8 per cent was noted when compared to 2Q16. This was due to the lack of big ticket items, as only four units hammered were above the SGD 1.5 million mark.

3Q16 also showed a fairly even mix of successfully auctioned property types as well as owner profiles. Preceding quarters typically saw more residential non-landed units and mortgagee sale listings being auctioned off.

As per the norm, residential properties dominated the auction floor, with a sales value of SGD 11.8 million and seven properties successfully sold. Industrial and commercial properties with total sales value of SGD 4.8 million (five properties) and SGD 4.3 million (two properties) respectively were also sold.

In terms of the seller’s profile, an almost even sales value was contributed by mortgagee and owner sale listings, with SGD 7.5 million and SGD 8.8 million being hammered down respectively. A trustee sale at 105 Dunbar Walk also contributed SGD 4.8 million to the quarter’s total sales figures.

However, 3Q16’s sales figure of SGD 21.2 million still presents a steep y-o-y fall of 114.2 per cent from 3Q15’s SGD 45.3 million, of which all 12 properties were residential. The amount was also boosted by several big ticket items such as the MCST sale of 3 Branksome Road at SGD 16.3 million and two shop-houses at 362 Tanjong Katong Road and 1 Figaro Street for SGD 6.4 million and SGD 6.5 million respectively.

Ms Mok Sze Sze, Head of Auction and Sales at JLL, noted: “With the uncertain economic outlook and current buyer’s market, auction will likely become a preferred mode of sale for owners where a definite timeline is set for decision with no cooling off period. In addition, we anticipate that there will an increase in mortgagee sales of between 10 to 20 per cent next year.”