Buying a home is partly an emotional decision. We take pride in our homes, not so much in our portfolio of stocks and bonds. Acting on emotion, however, can be a very costly mistake when it comes to purchasing a home. Paying top dollar for that sea view or being too gung-ho about the prospect of a property may leave homebuyers with regrets in the future.

A total of $64 million went down the sink in 3Q2016, the second-highest quarterly loss in at least five years, as 247 condo sellers incurred losses (Chart 1). The final tally could be higher as the full data for 3Q will only be available by end-October. While the ailing property market has been attributed for the losses, some sellers should share the blame for paying toppish prices for their property.

 

 

Of the $64 million wealth loss, $47 million came from the Core Central Region, also known as the high-end segment. The biggest loss in CCR in 3Q amounted to $3.1 million. It accrued to a 3,897 sq ft unit at St Regis Residences Singapore, which changed hands at $2,284 psf in July. Of the 233 caveats lodged for St Regis units so far, only 13% crossed $3,000 psf, including the $3,089 psf that the seller paid to the developer in 2007.

Last year, a penthouse at St Regis Residences made headlines when the seller, a Japanese billionaire, incurred a $15.8 million loss. He had forked out $28 million for the unit in a sub-sale in 2007, or at a record price of $4,653 psf. Meanwhile, the previous owner raked in a whopping profit of $12.8 million.

 

Another unit at St Regis Residences Singapore 
was sold at a hefty loss

 

One in three sellers in CCR, or 33%, incurred losses in 3Q, up from 31% in the past two quarters and 21% in the same period last year. Their losses averaged $457,000 and they held the property for an average of seven years.