It’s an EC world

Executive condominiums are some of the hottest properties on the buying public’s radar this year. These rare hybrid private-public homes straddle the 2 markets in the best way possible. While they begin their journey as public housing, thus allowing qualifying buyers to make use of government subsidies and loans to secure a usually cheaper-yet-comparable alternative to private condominium units, they graduate after 10 years to the private property market and their values more often that not appreciate considerably.

WandervaleECOne of the first ECs to be launched this year include Wandervale and The Visionaire. The Parc Life will soon be launched. Even though the nearby 1-327-unit Sol Acres EC might have been competing for buyers , 320 out of the 534-unit Wandervale EC in Choa Chu Kang has been sold.  Most of the units popular with HDB ugpraders and young families were the 4-bedders. 82 were sold in total. Prices averaged at $755 psf with a 3-bedroom apartment starting at $655,000 and the larger 4-bedders going for more than $896,000.  The Wandervale’s proximity to the Choa Chu Kang MRT station could have added to its popularity.

Besides The Parc Life, other EC launches in the works include Treasure Crest in Sengkang, Northwave in Woodlands and another in Choa Chu Kang.

HDB flat and private condo rental prices evening out

The difference between renting a HDB flat and a private condominium unit used to be $1,000. Today, the difference stands at only $500. The gap between HDB flat and private property rental prices have narrowed considerably, due not to the rise in HDB flat rents but in the drop in private apartment rents.

Qbay ResidencesIn the past, renting a suburban condo would cost you $3,100 to $3,300 a month. Now, it is possible to rent a suburban unit at $2,700. HDB executive flat and 5-room flat rental prices have remained around the $2,200 to $2,400 range for the past 5 years now.

HDB flatMuch of the rental drop comes from the sudden increase in supply of new private condominium units, with more landlords now jostling for the same or shrinking tenant pool. Many HDB upgraders will also join the HDB rental pool as they seek to rent out their HDB flats.

Property analysts are putting it up to the shrinking apartment sizes. The psf rents have remained the same, but tenants are now getting less floor area than they used to for the same amount of money. They are however picky about location and may be willing to accept a smaller-sized accommodation in a central located as opposed to a larger one further away from their workplace or town.

As the gap narrows, will the HDB flat rental market take an indirect hit as tenants opt for private properties over public housing?

Property market showing signs of awakening

Sturdee-ResidenceAlthough property prices have been falling, the show of interest from the buying public has never really waned, instead they are now simply more aware of their options and have become more selective in their investments.

Signs that the market lull might be broken soon have come from the positive take-up of units in 2 recent launches at The Visionaire Executive Condominium (EC) and The Sturdee Residences. 158 units were sold the 632-unit The Visionaire EC at a median price of $811 psf while prices averaged at $1,550 psf at the 305-unit The Sturdee Residences. Buyers at the private residential project have gone mainly for the smaller one- and two-bedders though 3 of its 8 penthouses have already found new owners. Two of the 1,830 sq ft penthouse units were sold at $3.2 million each.

Gem REsidencesThe Parc Life EC and private residential project Gem Residences will launch this weekend. Private condominium Stars of Kovan is expected to launch next month. The latter is a mixed-use development consisting of 390 residential units, 5 strata terraces and 46 shops. Prices are expected to range between $1,550 to $1,600 psf. E-applications for Parc Life have already exceeded the 660 units available and there is hope that uptake will be on the uptick at both these projects.

Tiong Bahru Living it up

HighlineResidences2Without a doubt, most Singaporeans, expatriates and even visiting tourists will consider Tiong Bahru to be one of the hippest districts in town. Well, that makes almost everyone, really.

Tiong Bahru has achieved a world ranking in Vogue’s Global Street Style Report: 15 Coolest Neighbourhoods in the World, coming up 4th in the list, quite a feat for a little township in this small city-state. Designated a Heritage Conservation Area by the Urban Redevelopment Authority (URA), it is much-loved for its pre-war architecture, quaint boutiques, eateries and cafes, its eclectic mix of housing options and just a general air of debonair.

Besides the shophouses and first-born HDB flats (it was Singapore’s first public housing estate), new private apartments are also coming up in its midst, providing options for more to enjoy the enclave’s gently vibrant atmosphere.

HighlineResidences1One of these new-kids-on-the-block is the Highline Residences, a 500-unit condominium inspired by the High Line in New York City and designed by award-winning architect Mok Wei Wei of W architects, which offers a good mix of one- to 4-bedroom apartments as well as dual-key units and penthouses. Developed by Keppel Land, the property is located just 5-minute’s walk away from Tiong Bahru MRT station and just a few stops away from the Orchard road shopping belt and the Central Business District. The upcoming Havelock MRT station nearby will be completed by 2021 and will add more transport options to the already-well connected area.

As far as city-fringe bohemian living goes, Tiong Bahru’s residents will be living it up for awhile.

 

 

Private home prices dip for 10 consecutive quarters

The delicate balance between population growth, economy growth and housing provision is not an easy one to strike. And Singapore as a young nation, will have to learn quickly as land is limited but the number of completed units to enter the market in the next couple of years is set to reach 23,000.

Cairnhill Nine CapitaLand

Photo credit: Cairnhill Nine by CapitaLand

Private property prices have been dipping for 10 consecutive quarters now, and the market will be under even greater pressure in the months ahead as supply continues to increase while demand remains stagnant. Rental prices are expected to fall even faster than sale prices and the global economic situation does not seem to be helping. Prices have fallen 9.1 per cent since Q3 of 2013 and non-landed suburban properties in the OCR (outside of central region) fell the hardest.

Part of the reason for the falling figures could be the cutback on land sales by the government and the consequent lack of new launches. Only 953 units were launched in Q1, but property players are expecting the momentum to pick up as the year moves on.

It the first quarter’s numbers were anything to go by, with sales rising 7.2 per cent to 2,847 units, volume may have increased across both the new and resale private home markets.

 

Prices of suburban properties dipping

Prices of new properties in the prime central districts have been rising, even as the market dulls. Suburban homes are feeling the strain put on the market by the influx of completed new homes this year.

The PanoramaBuyers seeking out properties in the suburbs tend to be more price-sensitive, and are often hampered by the total debt servicing ratio (TDSR) framework and the additional buyers’ stamp duty (ABSD), leading to higher competition from an expanding pool of stock for a shrinking pool of ready buyers. Prices at The Panorama in Ang Mo Kio have fell 9.7 per cent since its launch to $1,213 psf and similarly in Clementi, units at The Trilinq are now priced around $1,408 psf, almost 9 per cent lower than its launch price.

In comparison, buyers of properties in the prime central districts are more affluent and are able to afford the prices properties here demand. For example at Robin Residences, selling prices are now hovering at $2,371 psf, 2.4 per cent higher than its launch-price. Buyers of centrally located properties also have stronger holding power and less likely to sell unless the price is right.

RObin ResidencesThe price gap between suburban and central district homes have been widening. Last year, CCR (core central region) new-home price premiums were 81 per cent over those in the OCR (outside central region). As more OCR homes hit the secondary market this year, how will smaller investors handle the competition?

 

No luxury comfort for luxury property market

At $1,300 psf for a Cairnhill Plaza 4-bedder, it might be the lowest for a prime property in the middle of town in the last 10 years. As competition in the luxury property market heats up, owners and investors are finding themselves in a bit of a bind as prices dip and the buyers are few and far in between.

The Sail MarinaLeasing them out to fund mortgages have also proven to be increasingly difficult as the foreign workforce and pool of expatriates have shrunk due to job losses in the finance, oil and gas sectors. Combined number of secondary market losses registered in the core central region which consists of the prime districts of 9 to 11, the downtown core planning area and Sentosa Cove come up to 63 in the first quarter of this year alone.

As most of the expatriates looking for housing are now middle- or executive-level individuals with smaller housing budgets, smaller suburban properties in areas with regional business and commercial hubs are doing better than larger, high-end apartments in the prime or Central Business Districts (CBD). In fact, property analysts are now finding that more buyers are local Singaporeans who are purchasing a second or subsequent holiday home. As they are purchasing for occupation purposes, rental yields are less of a concern for them and are able to hold on to their purchases till a later date should they wish to sell.

Rental market bodes well for HDB flats

The rental market has been on the downhill slip as a fresh crop of completed new private homes hits the market this year. Competition for an increasing limiting tenant pool will prove to be tough for private property landlords, but HDB flat rental prices are holding out well despite the softening rental market.

Paterson SuitesCore central region private apartments seem to be suffering the most with the global finance, oil and gas sectors in turmoil. Expatriates working here and their families have been moving out of the country, scaling the tenant pool for luxury and high-end prime properties down even further. For example, a 3-bedder in a 1,600 sq ft unit in Paterson Suites which would have tenanted at $7,000 in January is now offering $5,800 in rent.

Serangoon HDB flatPrivate property rental prices fell 1 per cent in March, while HDB flat rents fell just 0.1 per cent. Changes in immigration policies have reduced the foreign workforce in Singapore and those remaining may have to work around a smaller housing allowance, hence many private properties may be out of their rental budget. HDB flats are a fair and affordable option. For locals or HDB upgraders who have to rent a home while waiting for their new BTO flat or condominium to be built, private units often prove to be too expensive as well. Will the positive rental yields for the HDB flat market boost the sales figures for this sector?