Singaporeans queue for days before condo launch; private property prices soaring
The Associated PressPublished: April 6, 2007

SINGAPORE: Retired businessman Tan Phong is not only willing to fork out more than 1,000 Singapore dollars (US$660; euro500) per square foot for a condominium apartment, he will even queue overnight on the street just to get his dream unit.

Singapore's private property market is booming, and the rising prices have not dissuaded Singaporeans and foreigners alike from snapping up prime real estate. Some condominiums have sold out within the first few hours of opening.

Tan was first in line to purchase a unit in a yet-to-be-built condominium to be called Seafront @ Meyer, in the Marina Bay area, near where the city's first casino-resort will open in 2009.

He hoped for a unit on the 18th floor or higher in the 24-story building.

"The location is good and I want something that faces the sea," said Tan, 66. "I love the sea breeze and that's exactly why I want a unit here."

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Sales for the 300-unit Seafront started Friday, but Tan and at least 80 others have camped out on the street since Monday morning, equipped with folding chairs, sleeping bags, umbrellas, playing cards and bottles of water. Many of them were hired by housing agents to retain a spot at the front of the line.

"I only stayed on the first night," said Tan, who recruited four friends to take turns standing in line for him. "It's very uncomfortable."

The condominium's developer, CapitaLand Limited — Southeast Asia's largest property developer — said the units will cost between S$1,400 (US$925; euro689) to S$1,800 (US$1,190; euro887) per square foot.

Singapore's Business Times reported last week the development's sea-facing penthouses may cost up to S$2,200 (US$1,455; euro1,083) per square foot, with one to be priced at S$9 million (US$5.95 million; euro4.5 million).

With Singapore's economy growing at a 7.9 percent pace, demand for such luxury apartments is driven by a variety of reasons, from people seeking comfort and status to a savvy investment.

Singapore real estate has also the interest of foreign buyers, according to real estate firm CB Richard Ellis Research.

Even though prices have risen here, they are still far lower than in cities like New York, Tokyo and London. Ultra high-end property prices in London can be as high as US$5,900 per square foot, according to research published last year by CB Richard Ellis Group Inc.

Several new projects away from Singapore's city center are being priced 50 percent more than what they would have fetched a year ago, led by strong interest in high-end homes, according to Li Hiaw Ho, an executive director with the firm.

Condo prices in the nonprime areas of central Singapore rose 2.9 percent in the first quarter following a 2.2 percent rise in the fourth quarter of 2006, according to the government's flash estimate released Monday.

On the broader market, private property prices in Singapore rose 4.6 percent from the fourth quarter after rising 3.8 percent quarter-on-quarter in the last three months of 2006.

Singapore's property market stagnated in the wake of the Asian financial crisis, lagging other Asian cities like Hong Kong, but signs of a recovery began emerging in 2005, helped by the government relaxing rules such as borrowing limits.

The market got a major lift from luxury developments like One Shenton, where hundreds of units were sold for about S$2,000 (US$1,322; euro985) per square foot at a soft launch in January this year.

An Orchard Turn development broke a record for residential properties in March, when penthouse units sold for more than S$4,000 (US$2,645; euro1,970) per square foot.

"Barring any unforeseen circumstances, it is likely that residential prices will rise by a total of 10 to 15 percent for the whole year, led by high-end projects," Li said in a statement.

About 85 percent of Singaporeans live in public housing built by the government's Housing and Development Board. Private developers compete to provide housing for the remaining 15 percent of Singapore nationals, along with the sizable foreign population.