New rule may weigh on Singapore luxury condo prices

Luxury condominiums prices here have continued to rise this year but a new rule may soon tie developers' hands, local media reported on Tuesday.

Till now, many have picked their time to launch developments when sentiments are good and decent prices can be charged. But under the rule changes expected to kick in early next year, they may lose this luxury, local daily The Business Times said.

If they bust the project completion period on sites bought from private sector sources, they stand to lose not just the 10 percent bankers' guarantee for land cost, but could also end up making huge payments for time extension.

All this could force them to launch earlier than they might like and affect prices, market watchers said.

The median price of new luxury condo transactions stood at 3, 265 Singapore dollars (2,475.4 U.S. dollars) per square foot in the third quarter this year, an increase of 18.7 percent year to date, according to CB Richard Ellis' analysis.

However, the figure is still about 13 percent shy of the peak achieved in fourth quarter of 2007.

A question mark now hangs over whether the previous peak median price of 3,750 Singapore dollars (2,843.1 U.S. dollars) psf can be scaled next year.
(Source:xinhua)