The market for good class bungalows (GCBs), the most prestigious segment of landed property in Singapore, is lukewarm although smaller bungalows in these GCB areas are catching on.
The tepid market contrasts with another upmarket landed segment, Sentosa Cove. Sales at the exclusive waterfront precinct have jumped to seven this year, compared with just four for the same period last year.
On the GCB front, a caveat was lodged on June 12 for the most expensive one sold this year.
But overall, the number of bungalows in GCB areas with a minimum plot size of 1,400 sq m - the technical definition of a GCB - sold in the first half of this year was 10, down from the 11 sold in the same period last year, according to caveats filed.
The latest GCB sold was a $46 million bungalow in Queen Astrid Park on a 29,709 sq ft site, reportedly purchased by the family who controls oil trading group Hin Leong.
The Urban Redevelopment Authority (URA) designates 39 areas as "good class bungalow areas", including parts of prime districts such as Bukit Timah and Tanglin but also those farther afield in Bukit Panjang and Binjai Park.
While GCB sales are down a little, smaller bungalows in GCB areas are proving more popular this year.
Price of the latest GCB sold, in Queen Astrid Park, on a 29,709 sq ft site.
Total value of the 20 sales that have taken place in GCB areas so far this year. These include properties with a plot size of less than 1,400 sq m.
According to CBRE's analysis of caveats filed with URA, 20 sales have taken place in GCB areas so far this year, worth a total of $432.2 million. These include properties with a plot size of less than 1,400 sq m.
This is markedly more than the 14 transactions in the same period last year, which totalled $298.36 million.
Mr Douglas Wong, CBRE Realty Associates' head of luxury homes, said the market this year has been driven by "multiple small-sized deals".
He noted prices in the first half of this year have come down by about 5 per cent from the same period last year, at $1,242 per sq ft (psf) compared with $1,318 psf.
However, the profile of buyers remains consistent, he added. Buyers this year include corporates and entrepreneurs in their 40s, with interest from new citizens, particularly those originally from China.
Mr Wong said he does not expect this year's sales to top last year's total of 37 transactions.
"We expect 30 to 35 GCB transactions this year as sellers are more motivated to preserve capital and wait for market sentiment to improve. Prices are likely to be flat."
Mr Alan Cheong, senior director of research and consultancy at Savills, said that the GCB transactions this year were of a lower dollar psf basis, reflecting poorer location, and/ or site characteristics.
"The slowdown in GCB transactions could be attributed to the lack of available good stocks of GCBs for sale," he said.
"What is holding the market back is that the 'creme de la creme' sites are still hard to come by with owners either refusing to sell at all costs or (selling) at exorbitant prices. Therefore, what gets transacted will be for GCBs that are in the normal rather than the superior grade in terms of location and land dimensions."
Overall, the number of landed homes sold has increased, driven by falling prices and limited supply of landed homes, said Ms Christine Li, director of research at Cushman and Wakefield.
URA flash estimates released on Monday indicated that prices of landed residential properties fell further by 0.4 per cent for the second quarter, compared with a 1.8 per cent decrease in the previous quarter.
"According to caveats lodged, 538 landed homes were sold in the second quarter - this is the highest quarterly volume since the fourth quarter of 2012, and is a definite sign that interest in landed homes is returning," Ms Li said.