The auction market here is being fuelled by the en bloc fever.

The auction market here is being fuelled by the en bloc fever.

Colliers International observed that the Singapore auction market has witnessed a burgeoning increase in the number of property owners choosing the auction route to sell properties with en bloc potential - a trend in tandem with the sizzling collective sale market. ‘Competitive bidding for properties with en bloc potential was seen among keen buyers, with final transacted price being 20-30 per cent above the opening price,’ said the property firm.

‘It is really an interesting phenomenon - we see a striking difference in the number of bidders present in the auction hall on the days when there are properties with en bloc potential being put up for sale, compared with those days when there are none,’ said Grace Ng, Colliers’ auctioneer. ‘The number of attendees jumps from the usual 100 to as many as 200 people, jam-packing the auction hall.’

Attendees comprise punters, ’specu-investors’, speculators, investors and home sellers/buyers alike, Ms Ng said.

Some examples of properties with en-bloc potential that were successfully sold at auctions include a unit in Watten Estate Condominium which was sold for $2.4 million, a residential unit in Lagoon View that went for $910,000 and a shop unit in Katong Shopping Centre which sold for $280,000.

The same trend can be expected for the second half of the year, Colliers said. ‘With the en bloc fever still running high, we can expect to see positive response for condominium and apartment units in the suburban areas from HDB upgraders and collective sale owners who are priced out of the prime areas, for the second half of this year,’ Ms Ng said. All this activity is adding to the robustness of the auction market. Colliers’ figures show that the total sale value of properties (owners’ sale and mortgagee sale) sold at auctions climbed 25 per cent to $263 million in the first half of 2007, up from $210.3 million in the second half of 2006.

Similarly, Knight Frank, which yesterday auctioned off a conservation bungalow at 781 Mountbatten Road for $13.95 million, said that the number and value of properties sold at auctions scaled new heights in the first half.

The firm estimates that with 132 properties sold in the first six months of the year, the number of properties sold rose by more than 36 per cent versus the second half of 2006.

It put total sales value for the first half of 2007 at about $286 million - also about 36 per cent higher than sales in the year ago period.

Going forward, the auction market will remain robust in the second half given the strong performance in the economy and property market as well as assurance from the government that it will not clamp down on the current buzzing property market, predicted Mary Sai, Knight Frank’s auctioneer. She expects a greater variety of properties will be offered at auctions in the coming months.

Source: The Business Times, 30 June 2007