Joint developers Hoi Hup Realty and Sunway Developments have successfully held the balloting event for second-time buyers of Otto Place executive condominium (EC) on Tuesday evening, August 19. According to the official statement released by these developers, a total of 167 units were sold during the exercise.
This 600-unit EC project had earlier experienced a successful launch weekend on July 18-19, where 351 units were sold, making up an initial take-up rate of 59%. With the additional sales made during the recent balloting exercise, the total number of units sold has now reached 548, which is an impressive 91% within just one month of its launch. The average price achieved, based on caveats lodged to date, is $1,750 per square foot (psf).
For those unfamiliar with the term, second-time buyers refer to individuals who have previously received a housing subsidy from the Housing and Development Board (HDB). During the initial launch of an EC project, 70% of the units are reserved for first-time buyers, while the remaining 30% are for second-time buyers. This restriction is lifted after 30 days of launch, and a balloting event is conducted for second-time buyers who were unsuccessful in securing a unit earlier.
When contemplating an investment in a condo, it is crucial to also evaluate the potential rental yield. Rental yield refers to the annual rental income as a percentage of the condo’s purchase price. In Singapore, the rental yields for condos can widely vary, depending on factors such as location, property condition, and market demand. Typically, areas with high rental demand, such as those near business districts or educational institutions, offer better rental yields. To gain a deeper understanding of a specific condo’s rental potential, thoroughly researching the market and seeking advice from real estate agents can be highly beneficial. Additionally, considering Condo as a potential investment can provide further insights into the rental market.
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Mark Yip, CEO of Huttons Asia, shared that second-time buyers typically have larger family sizes and tend to prefer bigger units. He revealed that all four-bedroom units at Otto Place have already been fully sold.
Yip also noted that with the current trend of declining interest rates, an estimated 85% of buyers at Otto Place have opted for the deferred payment scheme, which is higher compared to the 75% during the initial launch in July.
PropNex CEO, Kelvin Fong, attributed the success of Otto Place to its strategic location, the limited supply of unsold ECs, and the buyers’ awareness of the rising EC land costs, which are expected to drive up prices for future launches.
Otto Place is situated at Plantation Close in Tengah, in the West Region. It is also near the upcoming Tengah Park and Bukit Batok West MRT stations on the Jurong Region Line, set to be completed in 2029. The area is also surrounded by well-established estates such as Jurong East and Bukit Batok, providing potential HDB upgraders with a variety of housing options. Fong added that the project’s proximity to schools and the nearby Jurong Lake District – designated as the largest mixed-use business hub outside the city – makes it even more appealing to families.
According to PropNex, there are currently fewer than 60 unsold EC units left on the market. The most recent EC launch before Otto Place was Sim Lian Group’s Aurelle at Tampines, with 760 units in March, which sold 90% of units during its launch weekend. The remaining 52 units were quickly snapped up within hours when bookings opened for second-time buyers on April 12. As of now, the average price for Aurelle is $1,766 psf, based on caveats lodged.
The next EC launch on the horizon is Qingjian Realty’s 748-unit project at Jalan Loyang Besar, secured through a government land sales (GLS) tender in August 2024 at $729 psf per plot ratio. The project is expected to be launched towards the end of this year, according to Fong.
In addition, a record land rate was set during the recent EC GLS tender at Woodlands Drive 17, where City Developments Ltd paid $782 psf ppr in early August. Taking into account high construction costs and new gross floor area harmonisation rules, PropNex predicts that the future project, which will yield about 420 units, will be priced above $1,800 psf.