Residential Market News Extract - 24 August 2012

3 residential sites put up for tender

Three residential sites - two for private flats and one for an executive condominium - were launched for sale by public tender yesterday.

The plots - in Tanah Merah, Redhill and Woodlands - are all on 99-year leases and could yield about 1,600 units in total.

The 31,881.6 sq m site in New Upper Changi Road was one of two in the area that residents had petitioned the Government to keep undeveloped.

The other site is at the junction of New Upper Changi Road and Bedok South Avenue 3 and is on the reserve list of the government land sales programme.

It will be put up for sale if a developer makes an acceptable minimum bid.

Property experts expect some of the bigger developers to bid for the New Upper Changi Road site, which is near Tanah Merah MRT station and is able to accommodate about 540 units.

Competitive bidding is expected for the plot, especially from developers who failed to clinch a nearby site sold earlier this month.

Experts expect between five and 12 bidders, with the top offer coming in at between $550 and $700 per sq ft per plot ratio (psf ppr).

A condo site in Prince Charles Crescent in Redhill, also launched by the URA, can yield about 590 units on its 23,785.4 sq m.

It was triggered for sale after a developer agreed to bid at least $390 million.

Experts tip moderate interest of between six and 12 bidders with a top offer ranging from $720 to $950 psf ppr.

Bids are likely to be cautious, given the performance of projects in the central region, for instance. The quantum of the bid will limit it to bigger developers only.

The Housing Board has launched a 16,505 sq m site at the junction of Woodlands Avenue 6 and Woodlands Drive 16, earmarked for an exec condo of about 465 units.

The highest bid - from three to seven developers - could come in at between $300 and $350 psf ppr, experts said.

Source: The Straits Times – 24 August 2012

 

Bungalow market astir with several changing hands

Several big-ticket bungalow deals have been sealed recently including a few in Good Class Bungalow Areas (GCBAs).

A 999-year leasehold bungalow at Yarwood Avenue in the Rifle Range/ Dunearn roads area has changed hands for $19.5 million or $1,198 per square foot (psf) on land area of 16,278 sq ft. On site is a two-storey bungalow spruced up a couple of years ago.

The property, with a built-up area of about 9,500 sq ft, has three large bedrooms and a swimming pool.

Market watchers say this is the third property to be transacted since last year at this Yarwood Avenue cul de sac. A bigger bungalow on land area of 69,546 sq ft was sold in April last year for $59.5 million (or $856 psf) while another changed hands at slightly above $15.6 million or $968 psf in March 2011.

At Oriole Crescent, near Greenwood Avenue, a bungalow has fetched $18.2 million - or $1,726 psf on freehold land area of 10,546 sq ft. On site is a two-storey house said to be over 20 years old. It is leased out at a monthly rental of $18,000 until end-July 2014.

Talk in the market is that an option was granted recently for a bungalow on Camden Park. The price is understood to be $25 million, or $1,659 psf on land area of 15,070 sq ft. The property, said to have been rebuilt about four years ago, features a pool and gym in addition to six bedrooms.

Last month, a seasoned bungalow investor sold his GCB at Binjai Park for $32.9 million or $1,471 psf. On the 22,360 sq ft site is a new two-storey property, completed late last year, boasting seven en-suite bedrooms. The built-up area is about 17,000 sq ft.

A stone's throw away from Farrer Road MRT Station, a small freehold bungalow at Woollerton Drive was transacted a few weeks ago at nearly $12.6 million or $1,570 psf on land area of 7,987 sq ft. It has five bedrooms.

Typically GCBs have a minimum land area of 1,400 square metres (15,069 sq ft). However, when GCB Areas were gazetted in 1980, they included some slightly smaller existing sites. These are still considered GCBs as they would be bound by the other GCB planning rules if they were to be redeveloped. For instance, such plots cannot be further sub-divided and they cannot be built more than two storeys high (plus an attic and a basement).

Outside GCB Areas, other recent bungalow deals include a two-storey property at Trevose Crescent, in the Dunearn/Whitley roads vicinity, which changed hands at $13.7 million or $1,788 psf on land area of 7,662 sq ft. The property, completed six years ago, has four bedrooms and a roof terrace. The basement houses a home theatre and pool room.

GCB buyers these days are mostly Singaporeans seeking a property for their own occupation.

The number of bungalow deals in GCB Areas doubled from nine in Q1 this year to 18 in Q2, with the value of transactions rising from $224 million to $359 million.

Source: Business Times – 24 August 2012

 

Sales in luxury property market rebound

Even as investors stream back into the luxury property market, causing sales activity to almost double in the second quarter, further price correction may be in the offing given the growing number of unsold homes.

Data showed that there were as many as 4,000 luxury condominiums completed over the past year in Orchard Road, accounting for about 7 per cent of total non-landed stock in the luxury market.

Of this, 16 per cent (over 600 units) remain unsold, bringing total unsold stock in the prime segment to 12,855 units. This comprised 731 completed units and 12,124 uncompleted ones, half of which are ready to be launched.

Prices for non-landed new sales dipped 5 per cent quarter-on-quarter to $2,374 per square foot in Q1 2012, and slid further to $2,230 psf in Q2.

Reflecting the downtrend in prices, 19 units at Paterson Suites were purchased at an average price of $2,619 psf this year - 10 per cent below last year's $2,915 psf and 15 per cent off the peak price in 2007. A total of 12 units at Orchard View changed hands at an average price of $2,604 psf, down 21 per cent from 2010's peak price, while four transactions at St Regis Residences posted the largest drop of 28 per cent from the peak to $2,228 psf in H1 2012.

The spike in sales activity was observed across all market segments, with new sales up 246 per cent quarter-on-quarter at 235 units in Q2, sub-sales rising 34 per cent to 94 units, and resales increasing 86 per cent over the previous quarter to 585 units.

This pushed the number of units sold to 914, compared with a three-year low of 453 non-landed units sold in Q1, following the eurozone debt crisis and imposition of the additional buyer's stamp duty (ABSD) in December last year.

Specifically, demand for ultra-luxury homes (priced above $3,000 psf) almost trebled from 11 units in Q3 2011 to 31 units in Q2 2012.

These transactions include two units at Scotts Square sold for $4,566 psf in May and another for $4,803 psf in June; a 1,808 sq ft unit on the 52nd storey of The Orchard Residences for $4,399 psf; and two units at Boulevard Vue which sold for $4,326 psf and $3,934 psf.

A newly launched project, Twentyone Angullia Park, also drew keen market interest, with five sales completed over the last three months at prices of between $3,950 and $4,338 psf.

Source: Business Times – 23 August 2012

 

Thomson View condo back on en bloc market

Thomson View condominium is up for sale by public tender again.

The 99-year leasehold residential site located along Upper Thomson Road has a guide price of $580 million.

Including a $107 million premium to enhance the property's use and a $90 million premium to top up the lease, which has 62 years left, this translates to $685 per square foot per plot ratio.

Inclusive of the additional 10 per cent gross floor area for the balcony area - for which the site may incur a development charge payable to the authorities amounting to about $46 million - the unit land price is $659 psf ppr.

The project, which comprises 200 flats, 54 townhouses and a shop unit, has a land area of 540,314 square feet.

Under Master Plan 2008, it is zoned for residential use, with a gross plot ratio of 2.1.

The tender has been extended by a week and will close on Sept 4 at 3pm.

Source: Business Times – 22 August 2012

Residential Market News Extract - 23 August 2012

Parking crunch at new condos

The growth of public transport and a chronic lack of space are prompting developers to cut back on the number of carpark spaces in private condominiums.

Many new condos now typically provide one space per dwelling unit - meeting the minimum requirement stipulated by the Land Transport Authority - while those for visitors are being chopped altogether.

"Owners have the flexibility to provide more parking spaces, over and above this requirement to cater to their development's needs," said its spokesman.

But certain projects in the city and Marina Bay and those close to MRT stations can have fewer carpark spaces than the prescribed minimum, and providing visitor spaces is not mandatory.

Experts say the high cost of land has led to developers looking to maximise their gross floor area on homes rather than on parking.

Consultants believe home buyers may not realise the parking crunch until they move in.

ERA Realty Network senior marketing manager Andrew Phee said owner-occupiers are often the ones concerned about parking while investment buyers are less worried, "as they feel most tenants do not drive, have one car at most or rely on public transport instead".

Condos like Kembangan Suites and Attitude @ Kim Yam have mechanised carparks - drivers drop off their cars to be parked under a computerised system - but Mr Phee said many buyers see this as inconvenient and often opt for projects with normal parking.

Source: The Straits Times – 23 August 2012

 

Red hot demand for new 99-year leasehold private homes

About three in four private residential projects launched in the past year are 99-year leasehold developments, according to some property analysts.

Demand for these units has been strong, and market watchers said home buyers should be aware of what they are buying into, as the capital value of leasehold properties depreciates progressively as the development ages.

Experts said the price premium for a freehold property could be as high as 40 per cent.

Demand for many new 99-year leasehold private homes has been red hot, partly driven by the large number of such projects in the market.

They account for about 77 per cent of new private homes placed for sale between June 2011 and June 2012.

Analysts said there’s also a mindset change among some home buyers now and they are highly mobile when it comes to housing.

For instance, some buyers may take a short-term view on their home purchase, opting to move to another property after five to 10 years, so it doesn’t matter if the project is freehold or not.

For investors, market watchers said new leasehold units offer a better rental yield at 3.5 to 4.2 per cent, compared to about 2.5 to 3.5 per cent for freehold homes.

But those looking at wealth preservation or handing down their homes to their children will be better off with a freehold property.

99-year leasehold is always considered with a little bit of discount. The theoretical treatment of a 99-year leasehold land should be a depreciation of about 1 per cent per year.

For freehold properties, when the property is more than 20 years old and is ageing, and it is time for re-development perhaps through collective sale, the value of the land in a way is a bit more preserved because the developer would not need to pay the government a land premium to top-up the lease.

Analysts said a freehold property also commands a price premium over a comparable leasehold project.

This price premium could vary between 10 and 40 per cent.

Source : Channel NewsAsia – 22 Aug 2012

 

Wing Tai sees correction in S’pore’s property market

Property developer Wing Tai foresees a growing possibility of a correction in Singapore’s property market.

This as the firm announced its fourth quarter (Q4) earnings on Tuesday.

Wing Tai’s Q4 net profit slipped 16 per cent to S$140.5 million. This is despite its revenue jumping 88 per cent to S$202.2 million.

The company said its lower Q4 profit was due to a change in accounting standards, which do not recognise profits from uncompleted units.

Full-year profit declined 35 per cent year-on-year to S$242.2 million, while turnover dropped 17 per cent to S$624.9 million.

A total dividend of seven cents per share was also declared.

At the results briefing, Wing Tai said it is targetting to launch its latest freehold residential development with 337 residential units with one commercial unit next year.

Formerly zoned for industrial use, the developer has successfully applied to change the use of its former headquarters to residential.

Located at Tampines Road near Kovan MRT station, Wing Tai said this latest project which sits on land acquired in the 1960s would help capture any potential uptick in the property market.

But the property developer believes the market is set for a correction ahead.

Chairman of Wing Tai Holdings, Cheng Wai Keung, said: “A number of you have been asking why have we not been tendering for URA projects and we have not been active in the market for quite some time.

“I would still maintain that the correction will be coming and the way I look at it, is that if there is a cycle, if you take away that 2008 temporary drop, you smooth out the curve, it is actually the eighth or ninth year of the rise in this cycle.”

Source : Channel NewsAsia – 21 Aug 2012

Residential Market News Extract - 21 August 2012

Iras: Property tax flat for most landed homes

The taxman's review of the annual values of 56,000 landed homes so far this year has left about two-thirds unchanged, so the owners will not have to pay higher property tax.

The other homes have had their annual values adjusted upwards by an average of about 10 per cent, generally below last year's rises, the Inland Revenue Authority of Singapore (Iras) told The Straits Times.

A small number were increased over 20 per cent, as they had not been revised for a year or more.

There are 72,000 landed homes in Singapore and 193,000 private high-rise apartment units.

Iras is still reviewing the annual values of the private apartments and the rest of the landed homes. The review is expected to be completed by the end of the year.

Home owners typically keep an eye on a property's annual value, as it determines how much tax they pay. The annual value is the estimated annual rent the property may fetch.

This value can be revised up or down, based on market rentals of similar properties in the vicinity, said Iras. Valuation notices will be sent to owners when the annual values are revised, Iras added.

Reviews are generally held every year, but do not always result in changes to the annual values.

Property analysts say rents in some segments have eased, with the global crisis hitting expat budgets.

But because the annual value is a lagging indicator, it is more likely to capture last year's rates, and may not fully reflect the current market.

Source: The Straits Times – 21 August 2012

 

HDB rents soar as tenants flee private flats

Tenants moving into Housing Board flats to escape pricey private accommodation have driven up rent levels.

Overall median HDB rents rose 10 per cent in the 12 months to June, to $2,200 a month, the highest since it started collecting data in the first quarter of 2006.

Landlords in popular, mature estates like Toa Payoh and Marine Parade are asking for much more.

Median monthly rents for five-room HDB flats in Toa Payoh, Geylang and Marine Parade are $2,900 with some choice units close to the MRT station eclipsing $3,000, agents say.

A Ministry of Trade and Industry statement about June's inflation rate noted that accommodation cost increases, while moderating, have been stronger than expected.

The gain is largely due to the strong Singapore economy that has seen continued employment of foreigners across various sectors.

Demand from permanent residents (PRs) is also propping up rents, as the slew of residential cooling measures has made renting, rather than buying, the preferred choice for some.

Housing budgets are also being reduced across the board due to firms tightening their belts, prompting many employees to opt for the more affordable HDB option.

Tighter immigration policies are also likely to cap further rental gains.

Source: The Straits Times – 20 August 2012

 

New buzz soon for quiet Hillview

The sleepy Hillview enclave between Bukit Batok and Bukit Panjang is about to get a shake-up with a range of new projects to be completed over the next few years.

Property consultants say the new additions will boost the desirability of the upper-middle class area among home seekers, given that many condominiums there are now at least a decade old.

At least 1,500 new homes are expected to be completed in the next few years, including units to be built on a plot in Hillview Avenue that can yield 534 units.

Kingsford Development bought the 99-year-leasehold site in March.

Other projects include Far East Organization's The Hillier, which has sold 506 units out of a total of 528 at an average price of $1,267 per sq ft (psf) since its launch in January.

The mixed-use development includes the hillV2 mall, which will be ready in 2014, while the flats will be completed by 2016.

About 120 units have also been sold at The Lanai, also by Far East. The 214-unit condo, launched in 2010, has been selling at an average price of $1,354 psf this year. It will be ready in 2014.

The 193-unit Natura@Hill-view, a joint development between Macly Group and Roxy-Pacific Holdings, sold 157 units by July at a median price of $1,318 psf. It was launched in the first quarter of this year.

While new launches were priced at between $1,300 psf and $1,500 psf, median resale prices were lodged at between $750 psf and $1,000 psf.

Still, prices have generally been on the uptrend in the past three years, lifted partly by buyer interest for suburban homes.

Home owners who have held their units for at least 21/2 years have seen profitable transactions.

The rental range is quite mass market but the condos are of fairly good quality, noting that the area is still "remote" and hard to reach without a car.

But its transport options will improve once the Hillview MRT station opens in 2015.

Source: The Straits Times – 18 August 2012

 

Developers dangling rental guarantees as a draw

Some developers are turning to rental guarantees as a carrot to attract buyers for properties in Singapore and emerging markets in the region.

As competition hots up, these schemes are used to sweeten deals, with some helping investors to secure tenants and ensure they get a minimum predetermined yield.

But some experts warn that buyers need to examine the details carefully before signing up - and realise that a rental guarantee may already be built into the price.

They add that these enticements can amount to an indirect discount and are often dangled for overseas projects to attract investors to emerging and unfamiliar markets.

But the offer is also made during times of market weakness by developers convinced of a property's long-term potential.

They believe this will entice buyers to bite, as an alternative to lowering prices, which might depress the value of a project.

If developers start offering rental guarantees for Singapore projects, it would reflect the slow take-up of units as a result of cooling market sentiments, rather than Singapore being an unfamiliar market.

Source: The Straits Times – 18 August 2012

Residential Market News Extract - 16 August 2012

Sale of private homes jumps 42% in July

Demand for private residential homes, excluding executive condominiums (ECs), rebounded in July, with 1,943 units snapped up last month, 42 per cent more than the 1,371 units sold in June.

Even as mass-market sales continued to monopolise the market, the Core Central Region (CCR) - which includes Districts 9, 10 and 11, Downtown Core (including Marina Bay) and Sentosa - saw the steepest rise in buying activity, with 253 units sold in July, an increase of 79 per cent month on month.

This was propped up by the launch of V on Shenton - 144 of the 190 units at the development sold in July, at a median price of $2,061 per square foot (psf), making up 57 per cent of sales in the region.

Sales in the Outside Central Region (OCR), where mass-market projects are located, also continued to drive primary-market sales, accounting for 77.7 per cent, or 1,509 of the 1,943 private homes (excluding ECs) sold last month. Two of July's top-selling projects, Parc Centros in Punggol and Parc Olympia at Upper Changi, sold 492 units at a median price of $924 psf and 204 units at $874 psf, respectively.

The modest median launch prices of $874 and $924, which are fairly comparable to the neighbouring projects, reflect local buyers' growing resistance to further price increase. Unsold supply or future supply in the vicinity also contributes to the stabilization of prices in the neighbourhood.

Elsewhere in the Rest of Central Region (RCR), developers sold a total of 181 units out of the 281 released. The only new project launched, The Line @ Tanjong Rhu, found 13 buyers for the 62 units released from the 130-unit development. Other previously launched developments such as Eight Riversuites (33 units sold), M66 (28 units sold), Nottinghill Suites (12 units sold) and Idyllic Suites (11 units sold) continued to move units. As a result, sales volume was up 52.1 per cent in the region.

The strong sales in the mid-tier RCR were contributed by the increasing prices of suburban homes.

In July, about two-third of the private housing units sold in the RCR were in the price range of $1,001 to $1,500 psf. Thus, the overlapping of prices of private homes in the OCR and RCR could make the housing units in the RCR more appealing to home buyers.

Interest for ECs is expected to be positive despite the slowdown observed in July, backed by strong housing aspirations and well-designed projects.

However, the five-year minimum occupation period and the requirement to dispose of HDB flat after occupation of EC may discourage some buyers who are looking at long-term investment possibilities and capital appreciation of their HDB flat, especially for those which are in established estates with good property leasing fundamentals.

Looking ahead, primary market activity is expected to slow down in August, due mainly to the seventh lunar month.

Source: Business Times – 16 August 2012

 

Freehold Kovan residential site up for sale

Kovan Lodge - one of the last few older freehold blocks on Kovan Road - was put up for sale by tender yesterday.

Comprising a total land area of 27,090 square feet, the residential-zoned site currently occupied by Kovan Lodge is said to have the potential to be redeveloped into a much bigger residential development, subject to the authorities' approval.

Notably, if approval is granted to purchase an adjoining plot of state land of about 505 sq ft, the site could be built up to 38,633 sq ft based on the present gross plot ratio of 1.4, which translates to around $802 per sq ft per plot ratio (psf ppr) based on the indicative asking price of $31 million.

Location-wise, the property is situated in District 19 and is near popular shopping centres such as nex mall, Heartland Mall and Hougang Mall, providing easy access to amenities.

In addition, the development is just a stone's throw away from the up-and-coming food street@Simon Road, located at Kovan MRT Station.

Source: Business Times – 16 August 2012

 

Luxury home prices, rents to go further south

Prices of Singapore's luxury prime properties continue to lose steam despite a pick-up in the segment's sales volume in the second quarter, and this trend is likely to continue.

The average resale capital value for prime luxury properties fell 2.9 per cent quarter-on-quarter in Q2 to around $2,380 per square foot (psf), marking a second consecutive quarterly fall after a long period of stability.

At the same time, resale capital values of typical prime properties also dipped during the period by 1.5 per cent from the last quarter to about $1,350 psf.

This, despite a pick-up in sales volume in the prime districts, according to preliminary estimates, which showed a 22 per cent increase in units transacted to 528 units in Q2 compared with 434 units in Q1.

The spike was mainly driven by healthy uptake in both new sale and resale segments, which recorded a respective growth in volumes of 38.5 per cent and 22.9 per cent over the previous quarter.

A higher number of prime market developments launched in Q2 also helped to generate interest and buoy transaction volumes. A total of 101 core central region (CCR) units were launched in April and May (close to the 112 launched during Q1), providing new supply to the segment.

Specifically, new boutique developments, such as UP @ Robertson Quay and 1919 on Mount Sophia, proved popular among buyers, selling more than 60 per cent and 90 per cent of their units respectively at the end of the quarter.

An estimated 778 units were completed in Q2, up almost five times from Q1. The largest project, The Trizon, added 289 units to the market, followed by Rochelle at Newton with 129 units and RV Suites with 96 units.

However, the jump in supply dampened overall yields as average prime rental values dipped 1.2 per cent from Q1 to around $49 psf per annum ($4.08 psf per month), while average typical prime rental values fell 2.2 per cent to $38 psf per annum ($3.16 psf per month).

Rents have fallen, especially in older prime properties, large units, and properties facing construction. Lower rents are increasingly being accepted in struggling projects, while housing allowances are being reduced and expatriates are relocating to other countries negatively impacting leasing demand.

Source: Business Times – 16 August 2012

 

Caldecott Hill bungalow of late NKF founder up for sale

A bungalow owned by the late philanthropist Khoo Oon Teik is up for sale.

The good class bungalow (GCB) at 27 Olive Road has a land area of 23,423 sq ft and is being sold via an expression of interest by Knight Frank.

The two-storey bungalow, built over 30 years ago, sits on the site, which nestles within the GCB enclave of Caldecott Hill Estate. It is within walking distance of Caldecott MRT station.

The asking price for the property is between $26 million and $28 million, representing a land rate of about $1,110 to $1,200 per sq ft (psf). Buyers have up to Sept 18 to indicate their interest.

Recent transactions within the estate, such as properties situated along Andrew Road and Olive Road, have hovered around the $1,100 psf to $1,200 psf mark.

A bungalow along Olive Road is believed to have changed hands for about $30 million or $1,185 psf last month. The 25,300 sq ft sale site houses a two-storey detached house, which the buyer is expected to tear down and rebuild.

The GCB market has perked up, with transactions doubling in the second quarter to 18 units compared with the first three months of the year.

GCBs typically have a minimum plot size of 15,069.46 sq ft, but some sites may be smaller as a result of being gazetted under GCB areas in 1980.

They are highly prized because no new GCB areas will be gazetted, which means any fresh supply on the market can come only from carving up a much larger parcel of land into two or more plots, each of which must meet the minimum plot requirement.

Source: The Straits Times – 15 August 2012

Residential Market News Extract - 15 August 2012

50-year mortgage won't affect public housing much: MND

The government said yesterday that a novel 50-year mortgage is unlikely to be popular and will not have significant impact on the public housing market.

The 50-year housing loans will cost the borrowers more, besides imposing a longer-term financial

Since the United Overseas Bank (UOB) launched its 50-year mortgage last month - the longest loan in the market - the government has criticised the product, and warned borrowers not to fall for it and overextend themselves.

MND said: "While some borrowers may be attracted by the lower monthly instalments, we do not expect 50-year housing loans to be popular."

It added: "Their impact on the public housing market is unlikely to be significant."

HDB does not offer 50-year loans as they are not necessary and BTO (build to order) flats are priced to be affordable, well within one working lifetime, said MND.

The maximum loan tenure for HDB housing loans is 30 years, with an age ceiling of 65. In practice, the average loan tenure taken up is lower, at 24 years. At this loan tenure, the monthly housing loan instalment constitutes about a quarter of the monthly household income, and can be mostly paid for using CPF contributions with zero or minimum cash outlay, said MND.

CIMB head of research Kenneth Ng said the product is a marketing gimmick by banks to gain some loan volume in an environment where loan growth is diminishing. "Mortgage is one of the lowest loss history products and it is no wonder banks want to hold on to their loan share.

Source: Business Times – 14 August 2012

 

Two launches planned despite Hungry Ghost Festival

Two launches are on the cards over the next few weeks despite the traditionally inauspicious Hungry Ghost Festival starting on Friday.

Developers have tended to shy away from launching in the Chinese seventh month but there are increasing signs that superstition is taking a back seat when sales are in the offing.

Marketing agents say the 752-unit eCO project in Bedok South Avenue 3 is expected to launch early next month.

Units are likely to be priced from $1,150 per sq ft (psf) to $1,300 psf, meaning a typical 1,166 sq ft three-bedder will be about $1.4 million.

The 99-year leasehold project, jointly developed by Far East Organization, Frasers Centrepoint and Sekisui House, will feature various units, including suites, small office, home office (Soho) apartments and townhouses.

The freehold mixed development One Dusun Residences at Jalan Dusun in Balestier is also readying for launch.

It consists of 154 Soho apartments - largely two-bedders or two-plus-study units - and 76 shop units. Marketing materials suggest its preview will be at the end of this month.

Two-bedroom units - from 452 sq ft to 786 sq ft - are estimated to cost more than $600,000 while buyers of commercial units will have to stump up between $700,000 and $1.3 million.

Some experts say that the habit of developers avoiding new launches in the seventh month could be less common now as the younger generation of home buyers might be less superstitious.

However, ERA Realty key executive officer Eugene Lim said most developers still avoid the seventh month for launches.

"Developers might do the ground work by gathering buyer interest and holding the preview during that time but the main launch is often after the seventh month," he added.

He noted that at least three executive condominium projects - in Punggol, Sengkang and Woodlands - with a total of more than 1,700 units are expected to be pushed out in the fourth quarter.

Source: The Straits Times – 14 August 2012

 

New MRT line in east by 2020; will have 10 stops

The new Eastern Region Line (ERL) will have 10 stations and pass through estates such as Marine Parade, Tanjong Rhu, Siglap, Bedok South and Upper East Coast.

Slated to open by 2020, it will be 13km long, fully underground, and use driverless four-car trains. Its stations will link to the city centre and to the upcoming Thomson Line which will also use a four-car train. The older North-South and East-West lines use six-car trains.

The ERL, which will run almost parallel to the existing East-West Line, was first announced in the LTA's 2008 Masterplan.

Together with the Thomson Line, scheduled to open in 2018 to connect northern Singapore to the Marina Bay area, the new lines are meant to alleviate congestion on existing MRT lines, but little information about the ERL has emerged since.

The documents also included mention of an "integrated" interchange station linking the new ERL with an extension of an existing MRT line - though it did not specify which existing line this was.

It also did not give further details about the new interchange station.

Source: The Straits Times – 14 August 2012

Residential Market News Extract - 13 August 2012

Tampines holds its own with attractive amenities

Tampines has stayed on the radar of home buyers despite stiff competition from a bumper supply of launches in other suburban estates.

The area - designated a secondary commercial zone after the central business district - has continued to attract buying interest largely due to its wide array of amenities and easy accessibility.

The presence of international schools such as the United World College of South East Asia and its proximity to the Changi Business Park and Seletar Aerospace Park have also caught the eye of investors looking for healthy rental yields.

Experts say home prices in Tampines have outpaced the national average due to pent-up demand from Housing Board upgraders and the relatively lower supply in the pipeline.

Developments in the area have enjoyed price gains of between 23 per cent and 53 per cent over the past two years.

Tampines rental yields are between 4 per cent and 4.5 per cent, at the higher end of the typical 2 per cent to 4.5 per cent range found across the country.

Analysts noted that Tampines is well-served by three major shopping malls and transport links, including the East-West MRT line and the Downtown line, due to be completed by 2017.

Tampines Finance Park, which houses the backroom functions of some banks and insurance companies, is another economic driver.

About 75 per cent of Tampines residents live in HDB four-room and five-room flats - a potential pool of buyers for new launches.

There have not been many new projects in the area so demand is likely building up.

Source: The Straits Times – 11 August 2012

 

New homes put pressure on high-end rentals

Landlords of newly completed upmarket homes are being warned that they may have to be prepared to accept lower rents.

More than 4,000 private homes are set to be completed in the second half of the year - with many of them in the city centre and city fringe regions - possibly putting further pressure on rents of posh apartments that have already been softening.

Many of these high-end projects were rolled out in a slew of launches between 2007 and 2009 after the collective sale fever of the mid-2000s.

That was a vastly different landscape from the bumper supply of suburban launches from government land sale sites in the past two years.

Rents of non-landed city centre homes dipped 0.1 per cent in the second quarter - the only private non-landed rental segment to slide - according to data from the Urban Redevelopment Authority (URA).

The average monthly rent, tracked by analysts, dipped to $5.03 per sq ft per month in the second quarter, sliding 3 per cent compared with the three months before. On a year-on-year basis, prime rents fell by 8 per cent.

Experts say that the upcoming completions of upscale units will weigh further on the market.

But as long as Singapore remains a cost-competitive choice for corporates, newly completed projects should keep finding tenants, though landlords might have to manage rental expectations.

Vacancy rates for city centre homes have been trending up - to 8.2 per cent in the second quarter, from 7.8 per cent in the first.

This is in contrast to islandwide vacancy rates falling from 6 per cent to 5.9 per cent in the same period.

Leasing volume of high-end homes to ease in the third quarter as rental budgets continue to shrink. This may see many mid-level expats moving to the suburban areas.

However, the supply of high- end apartments is gradually tapering off as more suburban homes are completed in the next few years instead, experts note.

Almost 200 of the 4,285 homes expected to be completed this year are still looking for buyers. This adds to the 1,233 units in completed projects still unsold as at the second quarter, URA's data showed.

Source: The Straits Times – 11 August 2012

 

HDB resale policy has weeded out speculators

As recently as five years ago, private-property owners were snapping up resale Housing Board flats at market rates, making up 10 per cent of yearly resale transactions.

But tightened policies have cut the number of such transactions to just 3 per cent in the first six months of this year, going by fresh data from the Housing Board.

This means those going after resale units are now genuine downgraders who have either cashed out amid a property boom, or want to move to live closer their children, analysts said.

The turnaround was sparked by a change on Aug30, 2010. Before that, private property owners could buy a non-subsidised resale flat at any time, even while hanging on to their private property.

The policy that kicked in on that date required private property owners to sell off their property within six months of buying a resale Housing Board flat. This was to reinforce the principle that Housing Board flats are meant for long-term owner occupation, not for rental income or to make a quick buck.

The change effectively cut back on speculation in public housing among those well-off enough to own a private property and buy a Housing Board flat as investment.

ERA Realty key executive officer Eugene Lim said: "A substantial number of people bought flats in the past for investment and never lived in them."

The attraction for them was that Housing Board flats offer up to twice the yearly rental yield, at 6 to 8 per cent.

As of current, only genuine downgraders are entering the resale market, as they are saddled with a minimum-occupancy period of five years before they can sell the flat. It will be a constraint on their investments thereafter.

Source: The Straits Times – 10 August 2012

 

Property market sentiment improves in Q2

Property market sentiment improved slightly in the second quarter, but the mood was still dampened by the uncertainty over the euro zone debt crisis.

The Redas-NUS real estate composite sentiment index for April to June inched up to 4.7, from 4.6 in the first quarter.

It had declined for four straight quarters last year to plumb a nadir of 3.3 in the fourth quarter of last year.

A score below five indicates deteriorating market conditions while a score above five reflects improving market conditions.

The hotel sector continues to garner forward momentum with a net balance of 33 per cent of industry players surveyed saying they were optimistic about its current state, Redas and the National University of Singapore (NUS) said in a joint statement yesterday.

In contrast, the office sector is struggling owing to uncertainty over the global economic outlook, with a net balance of 31 per cent of respondents saying they were pessimistic about how it was currently faring.

A net balance figure is the difference between the proportion of respondents who were optimistic and the proportion who were pessimistic.

Fewer private residential units are expected to come onto the market in the coming months. Of the developers surveyed, 46 per cent expected more units to be launched soon, a sharp decline from 77 per cent in the first quarter of the year.

More of them than before also think prices will hold at current levels over the next half year.

"The uncertainty arising from the European sovereign debt crisis instils some degree of risk aversion in developers and buyers," said NUS real estate associate professor Sing Tien Foo.

"Some developers are adopting the 'wait and see' approach by moderating down new launches to the market."

The composite index, developed by the Real Estate Developers' Association of Singapore (Redas) and NUS' Department of Real Estate, combines two indices - the current sentiment index and the future sentiment index.

The current sentiment index, in which real estate industry players rate market conditions now compared with six months ago, stood at 4.9 for the second quarter, up from 4.8 in the first.

The future sentiment index, which indicates industry players' market outlook over the next six months, also moved up marginally from 4.4 in the first quarter to 4.5 in the second quarter.

Source: The Straits Times – 10 August 2012

Executive Condo (EC): Waterbay @ Punggol Central

WATERBAY

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Project description: 

6 blocks of 17 storeys comprising of a total of 383 units 

Estimated TOP Date: 31 March 2016  

Estimated Legal Completion Date: 31 March 2019