RESIDENTIAL MARKET
107 new home buyers backed out in March
107 new home buyers backed out in March
BUYERS of 107 new private homes had a change of heart last month and returned their units to developers.
The numbers, contained in a report from Goldman Sachs, show that even in a hot market, some people get cold feet. The same report also stated that 100 homes were returned the month before.
That means these buyers have paid an option fee but have chosen not to exercise the option and go ahead to complete the purchase.
If the buyer chooses to back out, he forfeits a quarter of the option fee, or 1.25 per cent of the purchase price.
The 107 units returned in March could have been bought in either January or February.
Analysts were not surprised by the high number of options lapsing, as the number of options lapsing tends to be correlated to the number of sales made.
Buyers bought 4,289 units in the first two months of the year.
In March, most of the returned units came from the mass market, but this could be because more projects were launched within the sector.
The Straits Times looked at a sample of 15 upcoming projects and found, for instance, 11 units were returned at the 689-unit Parc Rosewood in Woodlands.
Watertown, a 992-unit mixed-use development in Punggol, had 17 units returned.
Bartley Residences and The Hillier, both had nine units returned.
Since no new cooling measures have been introduced in the market since last December, which means many buyers could be pulling out because of personal reasons.
Some may have bought in haste while other buyers might have been attracted to better choices elsewhere.
Source: The Straits Times – 23 April 2012
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