In a recent media report with Ku Swee Yong, the Chief Executive Upper Thomson Road Condo of Century 21, more vacancies of Executive Condos (ECs) have occurred as a result of prices in the HDB resale market falling. Mr. Yong pointed out that there were 14,624 ECs completed by the end of September of this year. Of these, 2,946 units were part of six projects that were finished during 2014’s first 3 quarters. He went on to say that 2,375 units (or 16.2%) from this total figure remained vacant for Urban Oasis.

Vacant Units in Sims Urban Oasis

What this means is that Sims Urban Oasis Tengah Plantation Close EC have been brought into the market in 2014, however there was a significant rise in the amount of vacant unit in 2014’s 3rd Quarter, a total of 2,375.

Mr. Yong stated that part of the issue that is resulting in a slower uptake of Executive Condos, regardless of the MOP (Minimum Occupation Period), is that second time buyers and those looking to upgrade are finding it quite hard to sell the HDB flats that they currently own.

More looking at Urban Oasis in Geylang

If we look back at about 4 years ago, during which Sims Urban Oasis were launched, upgraders would usually plan to purchase the units under the expectation that the resale prices of HDB units would climb while the new homes were being constructed. Many of these upgraders were buying on a deferred payment scheme as well. Many counted on the significant bonus they would gain from the sale of their HDB units, ready in time for the completion of their EC units, to use to pay part of their EC unit loan.

It seems this trend for Aljunied Urban Oasis has now changed in a non-beneficial way for them. We have seen a drop of HDB resale prices over the past 5 quarters. Add to this the recent changes made to valuation guidelines along with Permanent Residents making purchases, trying to sell their current units at market value has become a real challenge.

SIms Urban Oasis Geylang

There are some HDB sellers, mainly upgraders for Sims Urban Oasis, who have been willing to accept the below market prices. However, there are still those who are waiting for offers to get better. Because of this, some buyers have held off on picking up the keys to their new EC unit because they are waiting on these better prices.

All of this has resulted in potentially 2,300 families in the EC sector simultaneously owning two housing units that are taxpayer subsidized: a) their currently owned HDB flat that they may also be occupying and b) their finished EC unit that they still have not moved into.

Keeping in mind that the law states that a family can only be in possession of one subsidized home for Sims Urban Oasis by Guocland, we are now seeing upgraders who feel forced to sell off their HDB units as fast as they can. We may see a worsening in this pressure to sell with the expectation of 2,854 EC completions for 2015, 6,371 for 2016 and 2,505 for 2017.