Analysis Here’s What Happens When You Buy A New Launch At The Peak Of The Property Cycle

  • September 10, 2020
  • 10 min read
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Sean

Sean has a writing experience of 3 years and is currently with Stacked Homes focused on general property research, helping to pen articles focused on condos. In his free time, he enjoys photography and coffee tasting.

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KK Huang
KK Huang

Hi Sean, I am new to buying/investing SG properties. Agents always tell us districts 9, 10, 11 freehold properties would do well in up or down market. Yet I see your examples above, Leedon Residence and The Trizon, both in CCR and freehold, sold for losses. As you mentioned, picking the right property makes the most difference. Was there anything wrong with those two properties that their prices took a dive despite being freehold and in CCR? Thank you.

caseyaff
caseyaff

This is a flawed analysis. Just because there are no loss making transactions doesn’t mean those owners who are holding on to their units aren’t making a loss if they sell now. They just won’t sell, so it doesn’t show up as a loss making transaction. They’re just stuck.

Ming
Ming

Thanks Sean for the great article. Do you have any opinions on condos in the East coast parkway stretch like Amber, Meyer, Siglap areas? Many new launches like Seaside residences, Meyer Mansion, Amber park have broken price records, do you think this area is at high risk of price correction? Would love to see you or other stackedhome writers analyze the condos along ECP.

beny
beny

hi sean, im looking to purchase a 1 bedder at eight riversuites or nearby location/down the road. Prices for Kovan area is currently higher even tho it is slightly further. I am considering for either own stay or rental. What do u think of riversuits? does the view and facing matters as i am looking for more capital upside for sure.

Stacked Homes
Stacked Homes

Hey Beny! Thank you for your question. We think the development is not good for own stay as the layout is not ideal – so we would consider other developments. But of course, this is subjective. From what we can see, the bedrooms, living room, kitchen and overall space is just small compared to other units.

Joseph
Joseph

Hi Sean, what would you think eight riversuites from an investment perspective? I plan to get a 3 bedder there for own stay, agreed with you the size and layout are not great but guess my family can bear with it. Given its location, relatively new and lower prices compared to new launches, does it make it a good investment candidate? Thank you!

Evan
Evan

Hi, what if you add Kovan Regency into the discussion? What do you feel about this development, able to share more?

Stacked Homes
Stacked Homes

Hey Evan! Kovan Regency’s first sale was in Q3 of 2012, so it’s 1 year away from the peak. Regardless, it still managed to see 59 profitable transactions so far out of 68 transactions. The highest was a profit of $299K, or 2.2% annualised, but the greatest loss was was a staggering $1.265M.

Teddy
Teddy

Hi Sean, love your analysis! Anyway, can you do a comparison between Q Bay Residences & The Santorini (2 bed / 3 bed) in today’s market situation considering the surrounding existing projects and new launches (since these projects were launched at the peak of the property cycle)? Would love to know your views on the value of these 2 projects. Thanks!

HCH
HCH

Hi Sean,
Good analysis and thanks for all your fabulous work on these useful articles. Your article is an eye opener and I agree with you to a large extent; that the property matters more than the time in the market. However, I think the risk of people buying at the peak is that when they want to exit, chances of making a loss is much higher and owners are stuck with their purchase not willing to take a loss.

Stacked Homes
Stacked Homes

Thanks for sharing your kind words! Yes it’s true, in every cycle there’re properties that still make it, and those that even when the market is down can make a loss!

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