Ghost town for new launches?

Source : Today – 22 Aug 2009

IF YOU are thinking of shopping for a private property this weekend, you may find your choices limited, as developers seem to be avoiding the start of the Hungry Ghost month when it comes to launching new projects.

The Hungry Ghost month – the seventh month on the lunar calendar – is considered by some to be an inauspicious time to buy new property. This year, the Hungry Ghost month began on Thursday and will end on the Sept 19.

Said Dr Chua Yang Liang, head of research (South-east Asia) at Jones Lang Lasalle: “The cultural taboo is quite strong and developers won’t be deviating from it, as the launches are still aimed at the mass market.”

August is also a traditionally low season for property transactions, and Dr Chua said he will not be surprised to see a pullback in property transactions, given the strong sales figures in July.

But independent property consultant Nicholas Mak said the slowdown in property launches may not be solely due to the Hungry Ghost month.

“Developers might not have any more projects in their pipeline that are ready for the market, after having pushed out (so many) launches over the past few months,” said Mr Mak.

Mr Chong Hock Chang, general manager of business development and marketing at Ho Bee Investment, said: “We look at the situation before making our decisions to launch a development. As our projects are still pending approvals, we cannot launch them, even if demand is good.”

Ho Bee has four upcoming launches listed on its website.

Big players like City Developments Limited (CDL) are not launching projects despite the current strong consumer sentiment. A spokesman from Hong Leong Group, the parent company of CDL, said: “The group is not planning any project launches for the lunar seventh month. An upcoming project by CDL will be a 396-unit residential development on the former Hong Leong Garden condominium site.”

NTUC Choice Homes said it will let buyers preview its 39-storey Trevista condo in Toa Payoh next weekend. The 99-year-leasehold project will have a total of 590 units.

Weekend Today also understands that Singapore Land is expected to launch Trizon, a freehold 289-unit development in the Mount Sinai area, at the end of the month or early next month.
Mr Colin Tan, head of research and consultancy at Chesterton Suntec International, said that despite the Hungry Ghost period, some developers might want to ride on the current bullish trend.

“Sentiment is very hot now. Developers will chase the sentiment as it is an opportunity not to be missed,” he said. He said that in the property boom in 2007, launches still continued throughout the Hungry Ghost month.

In August 2007, a record number of units – 1,723 – were sold. However, this record was eclipsed by the 1,825 units recorded in June this year.

“For the developers that are still holding on to projects that they could not launch during the economic crisis, this is a chance for them to try and sell more units,” said Chesterton’s Mr Tan.
“They will not want to risk it by going into a lull, which is why we might see some launches during or towards the end of the month.”