The 6,577 sq ft Yong An Park unit, which sold for $12.5 million, is currently the most profitable resale transaction recorded, with an $8.7 million gain. Source: Google Maps
The sale of a 6,577 sq ft unit at Yong An Park in District 9 emerged as the most profitable resale transaction by quantum during the third quarter of 2021.
This comes after the 25th-floor unit changed hands for $12.5 million or $1,901 per sq ft (psf) in September, resulting in an $8.7 million gain for the seller, reported The Business Times (BT) citing Edmund Tie Research data.
The freehold unit was acquired by the seller back in 2000 for just $3.8 million or $578 psf. With the seller holding on to the unit for almost 21 ½ years, the transaction worked out to an annualised profit of 5.7%.
Edmund Tie Research had ranked caveats for private homes with prior purchase history which were transacted in Q3 2021 and ranked them as profit- and loss-making deals, both by quantum and percentage.
A 1,119 sq ft unit at Park View Mansion was the most profitable transaction by percentage.
The ninth floor unit at the District 22 project was acquired in 2005 for $220,000 or $197 psf and was sold for $965,000 or $862 psf in July this year, working out to a massive gain of 340%.
Lam Chern Woon, Senior Director of Research and Consulting at Edmund Tie, said the $862 psf price achieved for the unit was a historical high.
Given the holding period of about 15 ½ years, the annual profit translates to about 10%.
All top five profitable transactions by percentage were held for at least 15 years, which resulted in annualised gains of 6% to 10% for the seller. Four out of five such transactions were for freehold properties, while profits ranged from around 245% to about 340% for all five transactions.
Meanwhile, four out of five most profitable transactions by quantum involved freehold properties and all were situated within the Core Central Region (CCR).
“In Q3 2021, profitable sales by quantum came predominantly from District 10 whilst loss-making sales came predominantly from District 9,” said Lam as quoted by BT.
“The average holding period of the loss-making transactions of 10 years was lower than that of the profitable transactions of 18 years.”
The largest loss-making transaction by percentage, on the other hand, was an 829 sq ft unit at a 99-year leasehold project in District 16. The unit was acquired in 2018 for $1.1 million or $1,327 psf and was sold for $525,000 or $633 psf in Q3 2021 – translating to a 20% annualised loss.
A 7,050 sq ft unit at a 99-year leasehold project in District 4 was the biggest loss-making deal by quantum. The unit within the Rest of Central Region (RCR) was purchased in 2007 for $17.95 million or $2,546 psf and sold after more than 14 years for $11 million or $1,560 psf in September. The transaction resulted in a loss of $6.95 million.
Cheryl Chiew, Digital Content Specialist at PropertyGuru, edited this story. To contact her about this story, email: [email protected].