Far East: Cooling steps may need tweaking | watertown

Straits Times: Wed, Jan 18

THE recent property cooling measures might have to be fine-tuned, depending on how persistently sales volumes drop, according to Far East Organization chief executive Philip Ng.

He told a briefing yesterday that the 10 per cent additional buyer’s stamp duty for foreigners is ‘a very big number’.

He also said that the measures had led Far East and its partners to drop the prices for the upcoming launch of its Watertown project in Punggol Central.

Foreigners, the main target of the new cooling policies, have shown less interest in the project than at launches before the measures, noted Mr Ng.

He said the measures may eventually need to be tweaked.

‘Indeed, there could be some calibration or tiering perhaps, but that’s something that has to be discussed with good data between developers and policymakers.

‘At this point, it’s pretty early days and you can see that there was already a drop in December,’ he said, referring to the 63 per cent plunge in new private homes sales last month.

He added that the policy should be allowed to run for a while to gauge if the sales decline is persistent before deciding if the policy needs calibrating.

Mr Ng made his comments at a briefing on the upcoming Watertown launch.

The 992-unit estate has a development cost of more than $1.6 billion and is being jointly developed by Far East, Frasers Centrepoint and Japanese firm Sekisui House. It will be integrated with a mall of 370,000 sq ft of net lettable shop space and a Shaw Theatres Imax cinema.

Prices have been cut by 5 per cent to 8 per cent in response to the cooling measures.

The first 250 units will be sold at a starting price of $1,080 per sq ft (psf) after the discount and are expected to go on the market next week.

Even with the price reduction, the development will still be the priciest project in Punggol, trumping Sim Lian Group’s A Treasure Trove, which was priced at $866 psf at its launch last September.

Watertown will consist of suites, ‘small office, home office’ (Soho) apartments, sky patios and residences. About 55 per cent of the units will be less than 700 sq ft.

Mr Ng said: ‘We’re reflecting the trends of major global cities like Hong Kong, Tokyo, London and Paris. They do have a sizable amount of small units in their stock… Most of our sales of small units have been quite well-received.’

He expects foreigners to account for less than 10 per cent of Watertown’s sales.

Mr Lim Ee Seng, chief executive of Frasers Centrepoint, did not give the briefing his forecasts on how the residential market might pan out but alluded to land tenders that closed after the cooling measures were imposed on Dec 7 as a gauge of sentiment.

Bids for these tenders were between 10 per cent and 20 per cent lower than those for nearby sites tendered earlier.

Source: The Straits Times © Singapore Press Holdings Ltd

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