Developers still keen on dual-key units despite cooling interest

Developers are still building "dual-key" units in private condominiums even though an initial surge in the allure of such homes has largely petered out, property consultancy Knight Frank said in a report on Monday.

It said, however, that demand from investors and muti-generational families is likely to be robust if developers can price them affordably.

These units, which have two separate entrances for privacy, typically appeal to investors who want to rent out part of their home and to young couples who want to live with their parents.

However, their relatively large sizes have recently made dual-key units harder to sell, as home loan limits imposed last June put a cap on how much home buyers can afford.

Dual-key homes have been included in four new private projects launched this year so far, which Knight Frank said indicated developers' "continued interest" in this type of unit.

There were dual-key units in eight private developments last year(2013), up from seven projects in 2012 and three in 2011, looking at large projects with 400 or more units.

The proportion of large private projects that had dual-key units rose from 19 per cent in 2011 to 32 per cent in 2012 and then to 53 per cent last year.

Within those large projects with dual-key units, developers have also been devoting a greater number of homes to that format. Dual-key homes accounted for 3.4 per cent of total units in those projects in 2011 on average, but that percentage climbed to 7.5 per cent on average last year(2013), Knight Frank said.

At the height of their popularity in 2012, dual-key units in private projects commanded prices that were as much as 16 per cent higher than for other homes of a similar size in the project. Developers also managed to move 84 per cent of those units that year.

However, the price premium fell last year to a maximum of 12 per cent as property market curbs dampened buyer sentiments. The take-up rate also tumbled to 58 per cent last year.