Good class bungalows still in demand

The private property, and perhaps more so landed property sector, has been the doldrums for most of the year. But the niche market for Good Class Bungalows (GCBs) has been thriving.

e704119a11f840b8865a9fb67a23b14eA total of 26 Good Class Bungalows were sold this year, with the total sales figure coming up to a whooping $587.75 million. Though it is nothing compared to the 133 sold for $2.38 billion at the height of the industry in 2010, it is comparable to the 29 sold last year for $682 million. But the average sf prices for GCBs have risen this year to $1,454 sf as compared to last year’s $1,388 psf. The Belmont Park, Chatsworth Park, Chestnut Avenue, Dalvey Estate, Raffles Park and White House Park areas received the most attention in 2014.

There are only 2,700 GCBs over 39 designated areas in Singapore, though the number may have increased slightly in the 1980s when GCB areas were gazetted. This resulted in some sites entering the good class bungalow market even though they are smaller than the usual 1,400 sq m size.

But property experts have noticed that the drop in transactions for these high-end properties were largely due to the  MAS-imposed TDSR (total debt servicing ratio) framework and ABSD (additional buyers’ stamp duty). Most buyers of these properties are likely to already have existing properties and the increased stamp duties will total up to a rather substantial sum.

They are expecting this market to fare similarly next year as the property cooling measures remain. But with buyers’ consideration possibly turning into long term value appreciation, the Good Class Bungalow sector will certainly stand its own.

Buyers think property market cool-down is here to stay

Private property prices and sales have been cooling for the past few months, and the market sentiments are that the cool-down will continue into the next year. Almost 4 in 10 people think that property prices will continue to decline over the next 6 months, though young couples who are at the verge of moving into the private property market think that a rise in housing prices may still be possible.

SantoriniInstead of a drastic fall in property prices, what 2014 has seen is a stabilisation of prices. HDB flat prices started off the price-drop which began in the second half of 2013. The private property sector followed suit in the beginning of this year. The most hard-hitting cooling measure was the restrictive loan limit which meant it became harder to borrow money to purchase a property. Although this may have made private property prices fall slightly, prices of HDB flats have not fallen significantly enough and with it becoming harder to get a HDB or bank loan, buyers of resale flats may be priced out of the market.

Thus a valid question may be, is the price decline sufficient? Is the decline sector- specific and is owning a property in Singapore a feasible goal for most citizens? What else can the authorities do to ensure equal opportunities for all. As the country prepares itself for the next General Election, answers may come soon.

Executive Condominium take the market

Closing the year on a high note for developers, were the latest EC launches in the market, in particular the Lake Life EC in Jurong.

Only 412 private condominium units were sold in November, while more than double the number of EC units were sold at 855 at last count. This could be partly due to developers’ decision to hold back on new condo launches and the pent-up demand for EC units.

Bellewoods EC533 units at the Lake Life executive condominium project were sold at an average of $869 psf. Comparatively, the private condominium Lakeville sold 30 units at $1, 374 psf. Over at Bellewaters EC in Sengkang, 170 units were sold, followed by 79 units in Bellewoods at Woodlands. The only new private property launches last month were TRE Residences and Sophia Hills Residences which sold 52 and 9 units respectively.

Could this response be a sign that buyers’ affordability range is narrowing and many prefer the opportunities and subsidies public housing options provide? Or is it merely a knee-jerk reaction to the pent-up sentiment of holding back new EC releases for almost 7 years in the Jurong district? What does this mean for the private property market and are ECs proving more competition for the private market than expected?

Private resale property woes

Have buyers of private non-landed properties decided to take a hiatus? November’s sales figures for private resale condominiums seem to indicate a widening gap between buyers’ and sellers’ price expectations.

With the tough loan limit still in place, the number of buyers for private properties have shrunk, much more so for resale units. Some buyers could be holding back as they wait for newer launches or are simply wary about jumping onto the bandwagon too early as industry analysts have predicted a tipping of the supply and demand scale in the next couple of years.

RIse OxleyResale properties in some districts have however fared better, some selling up to $80,000 above the valued property price. In the prime district 9, buyers have responded positively to properties in the Cairnhill, Killiney, Leonie HIll, Orchard and Oxley areas. And far out in the western district 22 comprising of Boon Lay, Jurong and Tuas, the average above-valuation price buyers have been willing to fork out was up to $30,000. At the fringe of the city, in district 11 of Chancery, Bukit Timah, Dunearn and Newton, prices went to approximately $15,000 above the market value.

So it seems that despite  announcements that properties in the city centre may be loosing its clout, the recent  numbers seem to indicate otherwise. How are the suburban resale sector responding to this shift? Are they shifting their preference to public housing options such as executive condominiums?

Lake Life EC in Jurong attract first-time buyers

Unlike its counterpart in Punggol, Lake Life EC in Jurong have been attracting mostly first-time applicants. Buyers at The Terrace executive condominium in Punggol were mainly HDB upgraders.

Lake Life ECEven the developer, Evia Real Estate, was surprised by the large numbers of younger Singaporeans. About half of the 534 buyers were first-time HDB unit buyers. Perhaps partly driven by the pent-up demand for ECs, especially in the Jurong district, as Lake Life is the first EC to be built there in 17 years; and also drawn by the promise of an estate rejuvenation with lakefront living and new amenities. Top that off with governmental subsidies for couples living near their parents, it is not surprising most of the buyers were already living in Jurong or the nearby HDB estates such as Bukit Panjang, Bukit Batok and Clementi.

This could signify a shift in buyers’ minds about the industrial and out-of-the-way Jurong of before. It has continuously added amenities and facilities to its midst, including libraries, schools, shopping malls and regional business headquarters.

Most of the buyers were below 40 years old and the average combined family income was $9,042. To qualify for a housing subsidy ranging between $5000 to $30,000 from HDB, the combined household income must not exceed $12,000. Perhaps this points to a new breed of home seekers and property buyers. Will private property developers eventually work to suit their needs and demands and close the gap between public and private property sectors?

EC peasy weekend breezy

If the crowds at the latest executive condominium (EC) launch were anything to go by, the property market may look a little cheerier. Despite many buyers being out of town and the upcoming busy holiday season, response to The Terrace EC in Punggol was heartening. 100 units out of the 747 were sold over the weekend alone. The Terrace launched on Sunday with prices starting at $710 psf for a three-bedder.

The TerraceMany of the buyers were young families and HDB upgraders as the options for mid to larger-sized units were available. The average unit size range from 1,001 sq ft for a three-bedroom unit to 1,711 sq ft for a penthouse unit. Other executive condominiums previously launched saw a slower weekend, but that could be due to the usual year-end lull and the fact that most units have already been selected and sold.

Location remains the main draw, though the EC sector is looking more positive than the private property sector. The other executive condominium developments which recently went on sale include The Lake Life, Bellewoods and Bellewaters. Joining The Terrace in Punggol will be the The Amore EC which is targeted to launch in January 2015. As competition heats up within the same district, buyers may have a wider range of options and prices may also adjust accordingly.

South Beach – the 12-month reveal

It’s a little like the 12 days of Christmas. Except this is 12 months of slow reveal of the South Beach development heralded to be Singapore’s largest mixed-use development, and in the city centre to boot.

Situated opposite the iconic Raffles hotel, the 1.65 million sq ft South Beach project on Beach road will feature 2 towers of 34 to 45 storeys, housing a mixture of offices, retail spaces, luxury homes and a hotel designed by the renowned designer Philippe Starck.

South Beach ResidencesThe 190 residential units here at the South Beach Residences have arrived ahead of the other massive development on the site of the old Capitol Building just a few blocks away. And at 950 sq ft to 6,500 sq ft each, from two-bedders to exclusive penthouses with their own swimming pools, it looks like the area will be welcoming a wealthy crowd soon.

sb-poster-comingsoon-hotel

Photo credit: South Beach Consortium.

The South Beach hotel will open in April next year and is aptly connected to the Suntec City Convention Centre and Esplanade MRT station. It looks set to bring an onslaught of traffic through the area and perhaps spilling over to the Beach road and Bugis stretch. And despite the lacklustre property market, half of the office spaces have already been taken by an MNC, the TMF Group and Robobank; it will possibly reach 90 per cent take-up rate by early 2015.

A whole new Sims

No, not the computer game. But Sims Drive. No longer will it be an address for offices, industrial buildings and warehouses. Come 2020, a new 1, 042 private residential project will bring a whole lot of life in the area.

Sims Drive GuocoLAndPhoto credit: GuocoLand.

The Urban Oasis private residential property development hopes to bring with it not only new residents, but hopefully more businesses and amenities. Some experts have likened the area to Tiong Bahru in its early days, and perhaps that might bring some “hip” factor into play. Currently, there are a couple of popular hangouts in the vicinity, Loysel’s Toy and Cafe Melba.

The project will be developed by GuocoLand and property analysts are expecting prices of units to be approximately $1, 200 to $1, 300 psf. The proximity of this plot of land to the Aljunied MRT station could draw potential home buyers and even investors are the units may cater to expatriates looking to live slightly out of the town centre or city fringe areas but with relative quiet and convenience.

Clermont ResidencesThinking ahead and differently from its previous projects such as Clermont Residence, Leedon Residence and Goodwood Residence, the developers are hoping to cater to different residential groups including singles, small families, upgraders and even those looking for a home office. Buyers can look forward to a variety of cluster homes, studio suites and even home office units.