Property Times

URA’s flash estimate of the private residential property price index for 1st Quarter 2012 indicates that overall private residential property prices have declined from the quarter before. This is the first price decline since 2nd Quarter 2009 and follows the trend of stabilising prices over the past 9 consecutive quarters.

The private residential property price index declined marginally from 206.2 points in 4th Quarter 2011 to 206.0 points in 1st Quarter 2012. This represents a decrease of 0.1%, compared to the 0.2% increase in the previous quarter.

Prices of non-landed private residential properties decreased by 0.9% in Core Central Region and 0.7% in Rest of Central Region in the quarter. Prices in Outside Central Region however increased by 1.2%, compared to the 0.6% increase in the previous quarter.

The flash estimates are compiled based on transaction prices given in caveats lodged during the first ten weeks of the quarter supplemented by information on the number of new units sold by developers. The statistics will be updated 4 weeks later when URA releases the full 1st Quarter 2012 real estate statistics, when more data on the caveats lodged and the take-up of new projects are captured. Past data have shown that the difference between the quarterly price changes indicated by the flash estimate and the actual price changes could be significant when the change is small. The public is advised to interpret the flash estimates with caution.

Property developers and agents are venturing into other avenues of business, as the once booming resale market for private and public housing has been affected by the government’s tightening measures.

According to estimates, the number of resale transactions in both markets dropped significantly in the first quarter compared to last year. However, the slowdown has spurred activity in other segments, with sales of mass-market condos rising. Home buyers snapped up 3,138 new private homes last month, including executive condominiums (ECs).

To get a piece of the action, property agencies such as ERA and PropNex are looking for direct deals with developers to market new launches.

Agents are also tapping on opportunities in the commercial and industrial sector, with many looking to sell such properties to boost sales. Some have also engaged in subletting HDB units to those who would rather rent than buy, which comprises mostly of foreigners.

Latest data from ERA and OrangeTee show that the number of HDB resale transactions hit between 4,000 and 4,500 between the January to mid-March period. This was nearly 30 percent lower than the 6,228 deals seen in the first quarter of 2011 and 24 percent below than the 5,921 transactions recorded in Q4 2011.

Tan Kok Keong, Research and Consultancy Head at OrangeTee, said the large number of new units and recent moves to allocate a larger number of flats for second-timers have reduced demand in the resale market. This has led to the cash-over-valuation (COV), which is the cash premium paid above a unit’s valuation, to also drop.

Mohamed Ismail, CEO of PropNex, also said that most buyers opt to purchase new flats because they only need to fork out the initial downpayment, which is 20 percent of the purchase price.

Taken from PropertyGuru:

Slowdown seen in resale property market – Property Auctions News, Property Investment | PropertyGuru.

World Class Land Pte Ltd has unveiled a new freehold mixed development offering residential units and commercial spaces at Tanah Merah.

Called East Village (pictured), it is strategically located at the junction of Bedok Road and Upper Changi Road. The freehold development offers 90 residential and 108 commercial units, and features a 50 ft long shop frontage which is expected to become a trendy leisure and lifestyle hotspot offering a supermarket, F&B and retail shops.

The residential component comprises one- to two-bedroom units, with select two- to three-bedroom penthouses that offer panoramic views of Tanah Merah. Facilities include a 35m lap pool, gymnasium, 300m on-site jogging track, a function room and Zen and wellness gardens.

Commercial units are priced from S$480,000 while homes are available from S$558,000 onwards.

“East Village presents an extremely exciting and appealing proposition to commercial and home buyers, an iconic landmark amid a unique and charming village setting with a vibrant urban flair,” said Koh Wee Seng, Director of World Class Land Pte Ltd.

“With a combination of prime location, good-sized shopping mall with a supermarket and luxurious residential facilities, the development will be a self-contained lifestyle hub providing convenience to residents in and around the Tanah Merah area.”

There will be a VIP Preview for East Village starting on 24 March 2012 at Bedok Walk.

Taken from:

World Class Land unveils new East Village project – Property Auctions News, Property Investment | PropertyGuru.

Despite the prices of condominiums softening in the first quarter, resale prices of landed homes have edged up in the same period, according to the latest estimates released by DTZ.

High-end condo prices fell 0.8 percent while values of freehold condominiums slipped 0.7 percent from the previous quarter. DTZ said this was mainly attributed to the additional buyer’s stamp duty (ABSD) implemented in early December.

It noted that competition from uncompleted projects was also a big factor, with an average of 2,200 units, excluding executive condominiums (ECs), being launched in the first two months of this year. In comparison, around 1,510 condo units were launched each month in 2011.

Despite the additional stamp duty imposed by the government, sales of non-landed homes in the primary market soared in the first quarter. Meanwhile, freehold landed homes in suburban areas recorded a price increase of 1.6 percent in Q1 while those located in prime districts 9, 10 and 11 inched up one percent during the period.

“The strong showing in the primary market was, however, not widespread, and was driven mainly by a few popular projects such as The Hillier, Watertown, Parc Rosewood and Guillemard Edge, which contributed to more than half of the sold units in January and February,” said DTZ.

“These projects enjoy attractive locations near MRT stations and offer small affordable units which reflect the trend in the market of investors eager to park some of their money in property to earn better returns.”

Primary sales (excluding ECs) hit an average of 2,143 units per month in Q1, up from a monthly average of 1,364 units in 2011.

“We expect a higher proportion of local buyers to dominate the market as foreigners take time to adjust to the new 10 percent buyer’s stamp duty they now have to pay,” said Chua Chor Hoon, Head of Asia-Pacific Research at DTZ.

However, she said that the popularity of uncompleted suburban projects is expected be healthy.

“If demand continues to remain strong at above 1,500 units a month, we do not preclude the possibility of further government cooling measures.”

While the Urban Redevelopment Authority (URA) reviews the overall design, unit layout, site and configuration of a project to ensure a liveable environment, a developer has the freedom to put as many rooms as it wants into a flat, said The Straits Times.

For instance, Macly Group and Roxy-Pacific Holdings plan to build a 635 sq ft three-bedroom unit in the Natura (pictured), a joint residential development in Hillview. But potential buyers say they are worried about space constraints.

Calling the unit “too small,” Heri Setiabudi, said that “if you’re thinking of renting it out, I don’t think people, especially the foreigners, will rent such a small unit… Even if you are single but intend to start a family, (it’s too small).”

Alex, a 35-year old manager, believes the units could attract investors who “are thinking of… subletting (them) as three separate rooms” but personally, he would not invest on such a unit due to “lack of flexibility”.
Ong, a 22-year-old newlywed, said the flat is too small to “raise a normal-sized family, which has about two kids on average.”

But real estate consultants are neutral on the issue, choosing to adopt a wait-and-see attitude.

Tan Kok Keong, OrangeTee’s Head of Research and Consultancy, expects buyers of Natura to be HDB dwellers that are eager to upgrade to private homes but “may be a bit stretched at the moment,” adding that it could be “challenging for people to hope to get very good rental.”

“It could be a marketing technique for one to try selling three bedrooms at a cost-competitive, affordable rate,” said Donald Han, Special Adviser at HSR Property Group.

Colin Tan of Suntec Chesterton International noted that Singaporeans may not be comfortable with a small living space, unlike the small flat dwellers in Hong Kong.

The Housing and Development Board (HDB) has released two new executive condominium (EC) sites located at Tampines Central 7 and Woodlands Avenue 5 under the confirmed list for H1 2012.

Together, the 99-year leasehold sites could yield 1,300 EC units. The Woodlands and Tampines plots are 25,800 sq m and 20,750.5 sq m in size respectively.

The tender for the land parcel in Woodlands will close on 3 May while the Tampines site tender will close on 10 May.

Meanwhile, two other residential sites released by the Urban Redevelopment Authority (URA) are located at Tampines Avenue 10, with Parcel A released for sale via the confirmed list and Parcel B under the reserve list.

The two plots, intended for condominium housing or flats, are expected to yield 1,115 units.

Both are 99-year leasehold sites which may allow for development of serviced apartments and have a total area of 20,071.1 sq m and 17,102.9 sq m respectively.

In total, the four sites could house 2,415 units, forming part of the total 14,100 residential units expected to be released under the Government Land Sales (GLS) Programme for H1 2012.

Private home sales in February remained strong and set a new record with transactions hitting 3,138 units including executive condominiums (ECs).

Urban Redevelopment Authority (URA) revealed that excluding ECs, the figures mark a 118 percent increase year-on-year to 2,413 units, as opposed to the 1,105 units recorded in the same period last year.

Top selling projects during the month were Parc Rosewood at Woodlands, which sold 380 units at a median price of S$994 psf, and Guillemard Edge at Geylang, which sold 275 units at a median price of S$1,215 psf.

As for ECs, Twin Waterfalls saw 257 units sold at a median price of S$727 psf while The Tampines Trilliant sold 187 units.

Most sales took place in the OCR (Outside Central Region) with a record of 1,830 transactions. ECs accounted for 23 percent of the total private home sales volume, as 725 units were snapped up in February backed by the higher income ceiling for acquiring ECs.

“Property developers had held back the launches in December 2011, especially after the ABSD. However, encouraged by the strong take-up rate of properties in January 2012, developers’ timely release of new launches in February had gained momentum and many had pushed ahead with their launches in the OCR while activity remained muted within the Core Central Region (CCR),” noted Mohammed Ismail, Chief Executive Officer of PropNex Realty.

The numbers are still robust “even after a seemingly draconian round of ABSD measure and after five rounds of property cooling measures that began in 2009,” said Alan Cheong, Director, Research & Consultancy at Savills (Singapore) Pte Ltd.

“It could be that Singaporeans have an innate desire to own properties. This desire, built up over a generation of public housing policy is evidenced by the fact that 87 percent of Singaporeans own their homes.”

Cheong added that the run up in the stock market could also be instrumental in boosting buyers’ sentiment.

“However, the main demand driver has been low mortgage rates which is generally below 1.5 percent,” he noted.

INTEREST in executive condominiums (ECs) remains high, based on the latest tender results for a 99-year EC site at Upper Serangoon View/Upper Serangoon Road , say consultants.
The site, which has a land area of some 133,388.4 square feet (sq ft) and plot ratio of 3.5, secured a top bid of $303 per square foot per plot ratio (psf ppr) . The site is expected to yield about 435 units.
Credo Real Estate executive director Ong Teck Hui, who noted that at $303 psf ppr, the bid exceeds the top bids of the last three EC tenders for comparable sites.
Assuming the top bidder is awarded the site, it will be Ho Lee Group’s second EC site acquired within a span of five months. The last was at Pasir Ris Drive 3/Pasir Ris Link, at $291 psf ppr, in October 2011, said DWG’s Mr Lee.
Interest in EC sites has been keener since the income ceiling for ECs was raised in August last year, reflecting developers’ confidence of sustained demand from a bigger pool of eligible buyers, said Credo’s Mr Ong. The income ceiling for ECs was raised from $10,000 to $12,000 last year.

This surpasses the previous high of $36 million for a bungalow on Paradise Island that was transacted in 2010.In the latest deal at Cove Drive, the price works out to $2,448 psf based on the land area of 15,929 sq ft.

Residential properties on Sentosa Cove have 99-year leasehold tenure.
On mainland Singapore, too, talk in the market is that another headline-grabbing price may be set in a Good Class Bungalow Area (GCBA) involving a vacant plot at Jervois Hill. The agreed price is said to be $31 million or about $2,050 psf based on the freehold site’s land area of around 15,120 sq ft. A Singaporean investor is thought to have entered a deal to sell the land to a party who is said to have paid a higher-than-normal option deposit. The deal also involves a completion period of one year – longer than the usual three months. Word on the street is that the buyer will be applying to become a Singapore citizen.

Sentosa Cove is the only place in Singapore where non-PR foreigners may buy a landed home, though still subject to LDAU approval. A foreigner (including a PR) may own only one landed home in Singapore (including Sentosa Cove) and this must be used for own occupation. The land area for the property must not exceed 15,000 sq ft.

When GCBAs were gazetted in 1980, they included some 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.
Another recent GCBA deal is at Wilby Road, where an old two-storey bungalow sold for $15.2 million or $1,093 psf.

On Sentosa Cove, Newsman Realty managing director KH Tan said foreign interest is returning, with potential buyers from places like China, Indonesia and India. ‘They come from a range of backgrounds, including, industrialists (eg in the coal-mining industry) and even developers from China. Some have children studying in Singapore while others find Singapore an interesting global city. They believe there’s room for substantial price appreciation in Singapore bungalow prices.’

JTC has made available an industrial site at Tai Seng Street, which is expected to be hotly contested given its location.
The 1.18-hectare site has a lease of 58 years and a maximum permissible gross plot ratio of 3.5.
Tan Boon Leong, director of industrial at Colliers International, expects a hot contest for the site given its ‘excellent location’. He added that there are not many sites at Tai Seng left.
But given that this site is located next to the Tai Seng MRT station, developers will not be allowed to strata sub-divide the development in the first 10 years after the project is completed.
Mr Tan reckoned the plot could command about $250 to $260 per square foot per plot ratio (psf ppr),

He explained that about 28 per cent of the floor area may be used for retail and food & beverage purposes.

Meanwhile, Mr Tan said all eyes will be on the industrial site at Serangoon North Avenue 4 as this is the first site since the new conditions on strata subdivision for industrial sites sold under the GLS programme kicked in.